Executive Summary
Researchers are observing a number of meaningful trends in marketing these days: Social media spending has been steadily rising for years (and has spiked during the pandemic); more and more, companies are outsourcing their social media activities to third-party agencies and cutting their in-house social media staff; social media having a more positive impact than ever on companies’ overall performance.
Despite these trends, however, marketers remain largely dissatisfied with their ability to manage their social media agency partnerships. This article offers concrete steps to marketers for improving their relationship with social media partners — and getting a better return on their investment.
During the first two months of the Covid-19 pandemic, enterprise spending on social media increased 74%, from 13% of marketing budgets in February 2020 to 23% in May 2020. This spike, reported in a special Covid-19 edition of The CMO Survey, represents a historic high for social media spending since 2009, and marketers expect it to stay at this level for the next year.
Social media spending seems to be paying dividends right now. Companies reported a lift in social media’s contributions to company performance (rising from 3.4 to 4.2 on a 7-point scale, where 1 = Not at All and 7 = Very Highly). While this may seem small by some standards, it’s actually quite a big deal; it’s the first time we have seen an increase in social media’s contributions since we first asked the question in 2016. But during the pandemic social media has proven to be a powerful tool for marketers who have needed to quickly adapt and reach their quarantined customers.
So how can companies seize this moment to optimize their social media strategies and see a positive return on their investment?
One answer to this question focuses on how companies organize and manage their partnerships with social media agencies. More and more, companies are outsourcing their social media activities (since 2014 the percentage of social media activities performed by external agencies has climbed from 17% to 24% in 2020) and cutting in-house social media costs (since 2014, the number of social media staffers per company has dropped from 4.1 to 3.1 people). But despite this rise in outsourcing, marketers don’t give themselves high marks for managing these partnerships (they rate their own ability to “manage external digital marketing partners and agencies” just a 3.8 on a 7-point scale, where 1 = Poor and 7 = Excellent).
To optimize these partnerships, companies should take the following steps:
1. Put a premium on trust. 30 years of research tells us that trust is a critical quality of successful agency partnerships. Trust paves the way for effective decisions, calculated risks, and creative work. But building trust takes intention. Research confirms that characteristics such as integrity and confidentiality are as important as expertise. So companies should look for indicators of these characteristics in their partners — and social media agencies should think about how to signal these intangible qualities along with their technical competencies.
Trust is a two-way street. Agency partners that sense they are trusted bond more deeply with their clients, which creates improved communication, motivation, and collaboration, and a virtuous cycle that produces better marketing. As Aaron Lavin, Senior Manager at Deloitte Digital noted, “One true measure of having a trusted agency-client relationship is the level of strategic connection between the teams. When this is working, it’s like multiplying creative thinking on your most strategic marketing challenges. What client doesn’t want that?”
2. Establish clear and ongoing communication channels — and do it early. Without regular communication, trust can deteriorate rapidly. So decide what channels work best for your partnership (Slack, email, Zoom meetings, or conference calls, for example) and align how frequently you’ll be in contact. Setting these boundaries early will help ensure that you and your partner sustain a timely and consistent workflow. And don’t forget to create a process for extraordinary communications: How will you fast-track strategy modification, content development, and approvals to address an ever-changing market?
Good communication starts with good onboarding. So in addition to building a curriculum that educates your partner on your customers, brand, voice, offerings, and business model, use the onboarding process as an opportunity to establish the culture of your partnership. Strong partnerships are good social fits. Is your culture hierarchical or flat? Formal or informal? Being aligned on culture is key to maintaining a healthy line of communication through the life of your partnership.
3. Meld internal and external perspectives. You know the business; the agency knows its craft. Agencies also have a depth of experience across industries that can help you identify novel opportunities. The trick is to weave these internal and external perspectives. To that end, invite your agency account manager to sit in on relevant meetings where your company’s overall marketing and brand strategy is discussed.
How will you know when melding has worked? One indicator is the level of integration achieved between your marketing strategy and your social media activities. The August 2019 CMO Survey asked respondents to rate how effectively social media supported their firms’ overall marketing strategies. Marketing leaders reported an average score of 4.2 (on a 1-7 scale where 1 = Not At All Integrated and 7 = Very Integrated) — far too low to render an adequate return on their social media investment. We recommend evaluating this level of integration as a process metric for evaluating agencies.
Another metric is to ensure that customers cannot tell if you or your agency created the content; if your consumers judge and react to your brand differently depending on who developed the social media content, you probably have a problem.
4. Establish clear objectives and align on metrics. Many companies do not have clear objectives for their social media activities. This can make it difficult to judge the value of agency inputs. The most effective social media activities have clear objectives and measurable performance. Decide on these metrics with your agency partner before embarking on a social media initiative.
During the pandemic, for example, companies’ most common objectives have been “brand awareness and brand building” (84.2%), “retaining current customers” (54.3%), and “acquiring new customers” (51.1%). Each of these objectives requires distinctive, getable target metrics so that both parties know what a good performance looks like. It’s also important to periodically revisit progress on goals and decide on appropriate adjustments, so build this kind of evaluation into your communication strategy.
5. Keep one hand on the steering wheel. By handing over full responsibility for filtering feedback to the agency, many companies miss relevant customer input. Instead, establish a regular cadence to access customer sentiment and important summary information from the agency. Doing both is especially important in this period of unprecedented market disruption.
This also means that companies should not “set it and forget it” — that is, design and schedule social media posts, but fail to monitor them for relevance. The Covid-19 pandemic — and the events 2020 at large — have demanded fast action from marketers and their partners. Be engaged with current affairs and prepared to adapt to them. Partnerships that are willing to re-evaluate their social media strategy in light of the rapidly changing landscape will not only minimize risk but also maximize their opportunity to connect with consumers. (To that end, a recent Journal of Marketing article highlights how real-time shifts in social media activities generate more virality online.)
6. Seek partners that adapt in times of uncertainty. Social media management is constantly being challenged by digital disruption. The pandemic has made this need even clearer as marketers report they improvised quite a bit during these past few months (5.6 on a 7-point scale, where 7 = A Great Deal). Companies need nimble partners that can quickly shift their resources and strategy as needed. In fact, when asked to rate the most important skills they would look for in hiring future marketers, the “ability to pivot as new priorities emerge” topped the list. This outlook is likely to apply to agencies as well; digital marketplaces are fraught with ambiguity that needs to be navigated. The ideal agency partner will have both the wisdom to navigate change and the courage to take calculated risks with your brand’s messaging (not to mention your company’s budget).
7. Stay attuned to social and political issues through your agency partner. Social media agencies are likely to be more deeply attuned to the political and cultural discourse than you are — that’s their business, after all. Listen and learn from them. What is the right way for your company to express its support for racial justice in the U.S.? What type of political voice is possible for your company in an election season? How should you weigh the risks associated with speaking up about social or political issues?
For marketing leaders, seeking this kind of input from agency partners is likely to be a little uncomfortable; marketing leaders generally don’t support getting involved in politically-charged issues (4 to 1 oppose). But it’s important that you trust your agency partner to guide you on when and how to effectively express your company’s voice.
8. Help the rest of your business learn from your social media agency partnership. Social media partnerships are just one of several collaborations your company will rely on. So as you work with your social media partner, think about what you are learning about managing a healthy partnership in general. What processes and structures work well? What doesn’t work well? Once you develop an analysis of your successful partnership, codify and share it within your company to accelerate the performance of other partnerships across the business.
Many enterprise leaders are flying blind in the current market environment. Social media agencies can offer substantial value in understanding the voice of the customer and communicating the company’s message to create value; don’t let that value go to waste.
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How to Get More from Your Social Media Partner - Harvard Business Review
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