Social Media Marketing Doesn’t Matter

A social media presence, on its own, isn’t enough to give you the upper hand.

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In 2003, in the midst of the dot-com bust, Nicholas Carr wrote a now infamous piece in Harvard Business Review entitled IT Doesn’t Matter. Although the controversial title certainly grabbed readers’ attention, the underlying point of the article was more nuanced.

Carr argued that IT infrastructure was becoming too ubiquitous to be the source of competitive advantage for companies. The rising digital tide raised all ships, and companies could not gain competitive advantage simply by investing more in the company’s IT infrastructure. Certainly companies could continue to use their IT infrastructure in innovative ways, developing novel business processes that would create competitive advantage. These advantages would be the result of how these companies used IT to transform their business, however, not a direct result of the IT itself.

A decade later, it’s clear that Carr was right. Today, a company’s IT infrastructure is so far from being the source of competitive advantage that many companies are moving their IT infrastructure to the “cloud,” allowing third parties like Amazon and Google to provide the essential IT infrastructure. Many universities use Google to mange their email, calendar, and file-storage services, rather than invest in and maintain their own IT infrastructure to handle them.

Even IT startups like Dropbox and AirBnB, each valued at around $10 billion, do not own and manage the IT infrastructure upon which they are built. When companies do choose to manage their own IT infrastructure, they usually do so to control proprietary data, not because they think they can manage the infrastructure better than others. Digital processes and innovation still matter, but the IT itself does not.

I argue that we have reached the same point with social media marketing. In terms of competitive advantage, social media marketing simply doesn’t matter. Having a presence on Facebook and Twitter is no longer sufficient to provide any source of competitive advantage for companies — not when all of their competitors have a presence on Facebook on Twitter, too.

Monitoring social media chatter and sentiment won’t provide any competitive advantage on its own, because all your competitors are monitoring the same content as you and can derive the same insights. Customers today expect to be able to engage companies over Twitter and other social media channels. Companies can certainly deliver better or worse customer service over these channels, just like they can over the phone or in person, but these challenges become questions of backend operations, not marketing. Social media marketing has become table stakes for competitive business in today’s world, not a source of competitive advantage.

The fact that social media marketing doesn’t matter is supported by the data from our 2014 survey of social business. Our data showed that using social media in other aspects of business — innovation, transparency into organizational communication, management and recruiting, and integrated into business operations — were all meaningful differentiators for company’s social business maturity and social business outcomes. Whether or not companies engaged in social media for marketing, however, had little meaningful impact on these outcomes.

It is certainly possible that companies can continue to use social media channels to do innovative things that transform their business processes and the customer relationship using social media. Just as Carr noted in 2003, however, it is the innovative business process transformations that becomes the source of competitive advantage, not the platforms or channels themselves.

The data from our most recent survey supports this point. A key predictor of social business maturity and outcomes was whether or not senior leadership saw social business as an opportunity to fundamentally transform the way the company does business. Effective social business is about using these tools to change the way the company does business, not simply using social media as another channel for business as usual.

Companies can also differentiate themselves by how they use the data generated by social media platforms — another point supported by our survey data. While monitoring social data may not provide competitive advantage in and of itself, the insights generated from effectively analyzing this data can inform one’s competitive decision making. For example, Mondelez International measures the additional amplification of traditional ad buys provided by social media platforms, factoring this data into their decision making. T-mobile developed a new marketing strategy that broke from traditional contracts after analyzing data on social media platforms that indicated this point was where the customers of its major competitors were most dissatisfied.

Again, it was not the fact that these companies monitored social media data that created the competitive advantage; it was that they analyzed this data effectively and used the insights it provided to affect their marketing strategy.

In short, simply using social media for marketing no longer delivers companies any meaningful competitive advantage on its own. The competitive landscape of social business today centers on how to use these social media tools to transform the way you do business and leverage the data provided by these platforms to do social business better.

The stakes for competing with social business have gone up — will your company call, fold… or raise?

For more insights on the current state of social business, be sure to check out our 2014 report on social business, coming in July.


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Comments (6)
Thalia Anne Daniels
This post got me really thinking. I've been working in this web design company for quite some time already and social media marketing drives tremendous traffic to our site.
Junayet Sajib
A huge amount of people are using social media right now.  So we can easily track the people activity from social media. Then we can 

research the  data for find the right customer and market also. Next few years later main marketing strategy depends on Social media 

Anton Boundstart
I do not think that all methods are relevant, tools and strategies for working with social networks change too quickly. How to catch everything!
Corey Weiner
McDonalds learned this with that awful social media disappointment they experienced. Proctor Gamble did soon thereafter when they dismissed a segment of their direct marketing personnel in favor of cheap social media assets (or perceived easy anyhow).  (Both of their stocks are doing well present day - no thanks to social media).)

I am not implying the above companies are necessarily at fault. 

I am saying social media involves relatively few barriers to entry. This is basic supply and demand economic principles.

Few entry barriers means LOTS of noise and social media amateur hour marketing-wise. So when everyone is emulating the next campaign, the result is metaphoric pier fishing. i.e. leaving too much success to happenstance. 

The prudent marketing vice president is more interested in reliable, efficient communication platforms to keep the revenue curve moving to the right.

And this is partially why big blue chip corporations still focus on event sponsorships, TV ads and the like. Meaning McDonalds has summer coupons mailed out, Papa John's is still on TV and sponsoring football games, GEICO, Progessive and AllState dominate prime time TV and the like.

Because they want to sign up new policies, sell pizzas, Big Macs and cars - today - not complete for popularity on the web alongside 40 other advertisers posting all sorts of stuff because it's trendy.

Corey Weiner, B2B Copywriter Editor
Chris Reich
Social Media Marketing is a myth created by marketing people to sell a service of little value. Because companies are not seeing a return, they are gradually backing away from venues like [sic] Facebook. 

A company considering a social media initiative would do better to improve their service at home. People use social media to reach companies that don't answer the phone. Nobody really want to be "friends" with a company.
Social Media was and is not to be ‘on-its-own’.  Optimizing IT and Marketing capabilities with a sound social media strategy has proven that IT matters.  But it won’t matter much if tools are not integrated in a way that resonates with empowered, complex customers of today and if too much emphasis is given to individual snippets of data and not to a cohesive understanding of the consumer over and latent needs. 

Entities, who want to differentiate their brands from the competition and augment social media investment impact, need to go deeper into consumer nuances and earn the right to be social with them.  Just as in market and media share, individuals only have brain/dollars space to select a few;  the competition now is for social media share one or two coveted spots in consumers social brand realm.