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Create, Maintain and Reap the Rewards of a Social Media Strategy

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Create, Maintain and Reap the Rewards of a Social Media Strategy DEGREE PROJECT IN MEDIA TECHNOLOGY, SECOND CYCLE, 30 CREDITS STOCKHOLM, SWEDEN 2017 Create, maintain and reap the rewards of a social media strategy. Skapa, underhåll och skörda belöningarna av en social mediestrategi. NIKLAS GUSTAVSSON KTH ROYAL INSTITUTE OF TECHNOLOGY SCHOOL OF COMPUTER SCIENCE AND COMMUNICATION Create, maintain and reap the rewards of a social media strategy. Skapa, underhåll och skörda belöningarna av en social mediestrategi. Student: Niklas Gustavsson, [email protected] Submitted for the completion of the KTH programme; Civil engineer in Media Technology, Master of Science in Media Technology. Supervisor: Christopher Rosenqvist, Stockholm School of Economics, Department of Marketing and Strategy. Examiner: Haibo Li, Royal Institute of Technology, CSC School of Computer Science and Communication, Department of Media Technology and Interaction Design. Work commissioned by: Marvelous Sweden Date of submission: 2017-06-14 Abstract This report analyzes the effects that social media marketing has on companies who choose to invest in a social media strategy. Previous research has looked at separate parts of a social media strategy, but no holistic view of the entire life cycle of a social media strategy has been created. Further, this report looks at what companies who choose to invest in a strategy gain from it in terms of different sources of business value. Advertising over digital media has increasingly taken market shares from more traditional advertising such as print, radio and TV. A large portion of this digital advertising is done through social media in the form of directing content at a specific target audience using the various social media platforms marketing algorithms. This increase in digital advertising is coupled by more companies choosing to create a social media presence. However, often have these social media presences failed to net any results due to a lack of understanding of the social media environment and how the consumers use the platforms. A case study was conducted on Marvelous, a Nordic digital agency specializing in social media. The case study also analyzed one of Marvelous’ clients who has invested in a social media strategy through them. The reason for this case study was to see how social media marketing is done in practice by a leading company within the industry. To complement the case study and get a less nuanced view of the development of a strategy and the results of it, qualitative interviews were held with other industry professionals who have worked with social media for several years. The results show that the life cycle of a social media strategy is made up of six stages: the pre- assessment stage, the strategy creation stage, the basics & hypotheses stage, the maturation & capitalization stage, the short-term evaluation stage and lastly the long-term evaluation stage. These different stages help companies in creating a strategy to guide social media efforts sustainably over a long period, leading to economical sustainability of the companies through granting advantages such as increased brand strength, increased sales and reaching a new consumer basis amongst other advantages. These advantages are gained while simultaneously strengthening the bond between consumer and company through the two-way communication that social media has enabled. Sammanfattning Denna rapport analyserar effekten som marknadsföring via sociala medier har på företag som bestämt sig för att investera i en social mediestrategi. Tidigare forskning har utforskat olika delar i en social mediestrategi, men ingen holistisk vy av hela livscykeln har skapats. Vidare så tittar denna rapport på vad företag som har investerat i en strategi får ut av det i form av olika källor av affärsvärde. Marknadsföring över digitala medier har ökat och fortsatt tagit marknadsandelar från mer traditionella källor såsom print, radio och TV. En stor del av denna digitala marknadsföring görs via sociala medier genom att rikta ett budskap mot en specifik målgrupp med hjälp av de olika sociala plattformarnas marknadsföringsalgoritmer. Denna ökning av reklam via digitala medier syns även i form av att fler företag väljer att skapa en närvaro på sociala medier. Däremot så misslyckas ofta denna sociala närvaro att gynna företag på grund utav en brist på kunskap om det sociala medielandskapet och hur kunder använder dessa plattformar. En fallstudie gjordes på Marvelous, en nordisk digitalbyrå som specialiserar sig inom sociala medier. I denna fallstudie undersöktes även en av Marvelous kunder som har investerat i en social mediestrategi via dem. Anledningen till denna fallstudie var att se hur denna marknadsföring görs i praktiken av ett ledande företag inom industrin. För att komplettera fallstudien och få en mindre nyanserad bild av utveckling av en strategi och dess resultat så utfördes även intervjuer med andra experter inom industrin som har arbetat med sociala medier i ett flertal år. Resultaten visar att en livscykel för en social mediestrategi är uppgjord av sex skeden: förhandsbedömning, strategiskapande, etablering och hypotesprovning, mognads- och kapitalisering, kortsiktiga utvärderingar och slutligen långsiktiga utvärderingar. Dessa skeden hjälper företag att skapa en strategi för att vägvisa deras insatser på sociala medier hållbart över en lång period vilket kan leda till ekonomisk hållbarhet för företagen. Detta genom fördelar såsom ökad varumärkesstyrka, högre försäljningsgrad, att nå ut till en ny kundbas och andra fördelar därtill. Dessa fördelar fås medan företagen samtidigt stärker bandet mellan kund och företag genom den tvåvägskommunikation som sociala medier har möjliggjort. Acknowledgements I would like to thank Christopher Rosenqvist at Stockholm School of Economics, SSE, for helping me with this thesis as my supervisor. Christopher’s help and expertise on the subject has been crucial for this thesis. This paper would not be what it is today without him. Second, I would like to devote a special thank you to Lisa Rytter who has been my supervisor at Marvelous and has helped me tremendously. I would also like to thank the Stockholm and Copenhagen offices of Marvelous for the help and guidance which they have provided me during these weeks. Another thank you goes out to the six interviewees who helped me by sharing their expertise on the subject and expecting nothing in return. The shear amount of knowledge that the six of you possess is beyond fascinating. Lastly, I would like to thank my friends and family for supporting me during these weeks. Table of Contents 1 Introduction ............................................................................................................................. 1 1.1 Background ...................................................................................................................... 1 1.1.1 About Marvelous ....................................................................................................... 2 1.2 Research questions ........................................................................................................... 2 1.3 Purpose and objectives ..................................................................................................... 2 1.4 Delimitations .................................................................................................................... 2 1.5 Report disposition ............................................................................................................ 3 2 Theory ..................................................................................................................................... 4 2.1 Social Media ..................................................................................................................... 4 2.1.1 Social media definition .............................................................................................. 4 2.2 Social media usage ........................................................................................................... 5 2.2.1 The general public’s social media usage ................................................................... 5 2.2.2 Social media usage for businesses ............................................................................ 6 2.3 Social media strategy ....................................................................................................... 7 2.3.1 Considerations necessary when creating a social media strategy ............................. 8 2.4 Social media marketing .................................................................................................... 9 2.4.1 Consumer-brand relations ....................................................................................... 10 2.4.2 User-generated content ............................................................................................ 11 2.4.3 Word of mouth marketing enabled by social media................................................ 13 2.4.4 Social media marketing evaluation ......................................................................... 14 3 Methodology ......................................................................................................................... 16 3.1 Literature study .............................................................................................................. 16 3.1.1 Purpose of method ................................................................................................... 16 3.2 Case study of Marvelous ...............................................................................................
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