CEO’s rely on data and input to make good decisions. The problem is that most of their data and input is filtered through other people whom at times want to please the CEO so as to be in good standing. Tus filtered information can lead CEO’s to make wrong conclusions which in turn impact business performance over time.
What Do CEO’s Think of Social Media?
Marketwatch reports: The results of the 2008 PRWeek/Burson-Marsteller CEO Survey found that 29 percent of CEOs believe that social media tools can be an effective way to communicate with stakeholders while an equal proportion (29 percent) believes social media outreach is ineffective. The survey also found that CEOs believe social media could be much more useful for building corporate reputation than for driving sales. The survey was conducted jointly by leading PR publication, PRWeek, and Burson-Marsteller, a leading global public relations firm.
The CEO Survey reveals that while 42 percent of CEOs personally participate in social media outlets, just 18 percent of CEOs have used social media to engage their company’s stakeholders. These CEOs do not use social media outlets, such as Facebook, MySpace and YouTube, to communicate with key stakeholders primarily because these chief executives believe social media is not a “relevant” channel to reach stakeholders (45 percent). “CEOs should understand that many of their stakeholders are active users of social media and that it can be an extremely effective means for communicating a message,” said Mark J. Penn, Burson-Marsteller’s President & CEO. “I would argue that companies that are not engaging in social media are taking a bigger risk than the companies that are.”
While not all CEOs are convinced that social media can be a business communications tool, many agree that the Word of Mouth (WOM) conversations that are often sustained by social media can have a significant influence on their business. CEOs believe that WOM has the fastest growing impact on a business’ overall reputation, with 60 percent reporting its influence has increased in the past three years. In fact, CEOs say WOM is the second most influential medium overall (42 percent), after The Wall Street Journal (51 percent).
Assessing PR Effectiveness in 2009
Thirty-four percent of CEOs surveyed are satisfied with the ROI of their company’s public relations activities, but 49 percent are just “fairly satisfied” and 17 percent are not satisfied at all. During 2009, 63 percent expect to be more concerned about the ROI of their PR, and 36 percent will be equally as concerned as they have been in the past. The survey also found that only 26 percent of companies “usually” or “always” invest in market research for their public relations activities as compared with 36 percent who invest in research for sales and 34 percent who invest in research for advertising. CEOs also measure the effectiveness of PR less than they do for other marketing activities (56 percent for PR vs. 63 percent for advertising and 66 percent for sales).
Reports such as these reflect a sentiment of “mixed feelings” by CEO’s relative to PR, Marketing and Social Media. The sentiments may change as the economy continues to put pressure on capital, resources and revenue growth. The current market dynamics may in fact shift significantly as the rippling effect of the economic downturn forces CEO’s to look for more effective alternative to reach their markets at lower cost.
Business Week Reports: Burson-Marsteller thinks CEOs should be more social. In the press release on the findings, Mark J. Penn President & CEO says “CEOs should understand that many of their stakeholders are active users of social media and that it can be an extremely effective means for communicating a message. I would argue that companies that are not engaging in social media are taking a bigger risk than the companies that are.”
What say you?