The 2015 Inc. 500 and Social Media

Executives Concerned About ROI, Name Facebook Most Effective, Blogs Continue Decline: 

The 2015 Inc. 500 and Social Media
 

Conducted by:

Nora Ganim Barnes, Ph.D. (nbarnes@umassd.edu)
Ava M.  Lescault, MBA (alescault@umassd.edu)

Introduction

The Center for Marketing Research at the University of Massachusetts Dartmouth recently conducted its annual in-depth study on the use of social media by the fastest-growing corporations in the US.  This new study revisits the Center’s work on the Inc. 500 social media usage for the ninth consecutive year, making it a valuable and rare longitudinal study of corporate use of new communication tools.

The Inc. 500 comes from the list of the fastest-growing private US companies compiled annually by Inc. Magazine.  These companies are privately owned, based in the US and independent (not a subsidiary or division of another company). For details about the 2015 Inc. 500 and the complete directory of the included companies, please visit Inc. Magazine’s website at Inc.com.

As in the earlier studies, the 2015 study, under the direction of researchers Nora Ganim Barnes and Ava Lescault, is the result of both secondary data review and targeted telephone surveys of those companies named by Inc. Magazine to the Inc. 500 list for 2015.  All interviews took place in the fall of 2015.  The businesses on the list include a wide range of industries from IT Services and Health to Environmental Services.

The research presented here was conducted using two approaches.  First, every company named to the 2015 Inc. 500 list was examined in order to determine which social media tools they were using.  Each homepage was reviewed in addition to the entire website (since some did not link to their accounts from the homepage).  Search engines were also utilized to find an online presence if none was obvious after reviewing the website.  All of the 2015 Inc. 500 were included in this part of the process.  Eight social media platforms were examined including LinkedIn, Facebook, Twitter, Blogging, YouTube, Pinterest, Google+ and Instagram.

Our second level of research involved interviewing a random sample of executives from the Inc. 500 list to ask questions with a specific focus on issues such as concerns regarding social media use, online crisis management and social media policies.  One hundred twenty-one interviews were conducted representing 24% of the Inc. 500.

The responding executives are a diverse group, representing 22 of the 26 industries on the 2015 Inc. 500 list.  Eighteen percent of the companies surveyed made the top 100 on the list (9 are ranked in the top 25).  Respondents reported annual company revenues ranging from under $3M to over $100M with 50% of them falling between $3M-$10.9M.  Sixty percent of the sample has 1-50 employees and 77% were founded between the years 2008-2011.

This latest iteration proves once again that social media is an important component of how businesses present themselves to potential clients/customers.  It also indicates that corporate usage of social media and the policies around it are still developing and concerns about managing time for social media and its ROI continue.

 

Study Highlights:

  • 93% of the Inc. 500 have a LinkedIn account, Facebook presence increased 2% to 82% and Twitter holds at 79%
  • Blogging declined (46% to 37%) among the 2015 Inc. 500 for the second year in a row. (A decline in blogging was also recorded among the 2015 Fortune 500.)
  • 12% of the 2015 Inc. 500 have a stand alone social media policy (up 5%), 33% have a written social media plan (up 16%) and 27% have an online crisis management strategy (down 7%).
  • Instagram continues its popularity among this group with a 7% increase, now at 32% adoption.
  • The top two concerns regarding the use of social media are time allocation for social media and the ROI, while the top benefit is increased exposure and building brand awareness.

Detailed Findings

1a. Inc. 500Usage of Social Media

As companies continually develop an understanding of which social media platforms best fit their needs, we see the incorporation of new platforms and tools, as well as increasing or declining use of others.  Ninety-six percent of the Inc. 500 use at least one of the tools studied (3% more than 2014).

Of those using social media, LinkedIn maintained the number one spot for the 4th consecutive year with an adoption rate of 93% (down 1% from 2014). Twitter remained the same this year at 79%, Pinterest dropped 1% to 29%.  The following saw increases in adoption:  Facebook (2%), YouTube (5%) and Instagram (7%). 

Google+ accounts increased from 43% to 64% but continue to be the most likely social media accounts to be inactive.

 

In 2007, the Center’s first study of this group and their use of social media was released and revealed that the Inc. 500 were outpacing the revenue-based Fortune 500 in their use of social media.  For example, at that time, research showed that 8% of the Fortune 500 companies were blogging compared to 19% of the Inc. 500.  This trend held steady for the past 8 years with the Inc. 500 continuously out-blogging the Fortune 500.  The most recent data collected on both groups suggests that the pattern holds with 37% of the Inc. 500 currently blogging and 21% of the Fortune 500.  However, both groups decreased their use of this mature but valuable tool in 2014 versus 2013 and again this year. It is interesting to note that when executives were asked about the main goal for posting on social media, only blog posts were cited as having the goal of thought leadership.

1b.  Top 5 Inc. 500 Companies Based on Facebook Likes

The 410 companies (82%) with corporate Facebook pages come from all industries represented in the Inc. 500.  A partial list is presented showing those companies with the greatest engagement through Facebook “likes”.  Fitbit, manufactures activity trackers/wearable technology devices that measure personal metrics. They are among the most active of the Inc. 500 on social media and show up in the top spots across platforms based on likes, fans and followers. 

Company

2015 Facebook Likes

Fitbit

1,104,515

Adore Me

1,007,215

Pluralsight

875,406

Craftsy

744,720

Allied Wallet USA

706,659

1c.  Top 5 Inc. 500 Companies Based on Twitter Followers

On Twitter, one measure of engagement is followers.  Of the 395 Inc. 500 companies (79%) with active corporate Twitter accounts, Simply Measured, is the most popular, followed by Fitbit, Pluralsight, Ronnie Coleman Signature Series and Visually.

Company

2015 Twitter Followers

Simply Measured

314,632

Fitbit

224,559

Pluralsight

209,148

Ronnie Coleman Signature Series

197,954

Visually

137,671

1d.  Top 5 Inc. 500 Companies Based on Pinterest Followers

Pinterest attracts 145 (29%) of the Inc. 500 companies.  The most popular on this platform is Craftsy, followed by Makeup Geek, Jane, Adore Me and Fitbit.

Company

2015 Pinterest Followers

Craftsy

128,740

Makeup Geek

71,700

Jane

63,664

Adore Me

45,800

Fitbit

30,900

2.  Effective Social Media /Strategies for Sales Growth

For the third year, executives were asked which social media tools/platforms they felt are the most effective for their business.  Forty-eight percent of those interviewed reported Facebook is the most effective social media platform with consistent numbers over the past 3 years.

Twitter is now viewed by 14% of executives as the most effective (declining 36% after an 11% decline in 2014) platform.  Similar to last year, 13% cited LinkedIn as an effective tool for their business.

Executives were asked about potential options to increase sales over the next year.  In 2014, online advertising garnered 40% support while social media platforms was favored by 14%.  This year online advertising dropped to 24% and the use of social media platforms increased to 38%.  This may indicate a movement away from traditional online ads to more engagement and social commerce activity through social networking sites.

 

3.  Tracking Sales through Social Media

Forty-eight percent of the executives interviewed indicated that they are tracking sales that come through their social media platforms, up 16% from 2014. 

We also asked respondents to estimate the percent of total annual sales coming through Facebook, Twitter and Pinterest.  Twenty-three percent believe sales from social commerce are limited to less than 1%.  This is a decrease from 44% last year.  Some companies, however, estimated this channel to be more significant for them.  There are reported increases (4%) in those estimating 6% or more coming through these sites.

4.  Assessment of Social Media Effectiveness

This year executives were asked to agree or disagree with statements about the effectiveness of their social media efforts.  Almost all of them pointed to building brand awareness being most effectively impacted.  It is interesting to note that generating leads and sales was considered to be effectively achieved through social media by 74% of executives.

Statements

% Agreement

Social media is effective in building brand awareness.

98%

Social media is effective in creating relationships with consumers/customers.

88%

Our company’s efforts in social media have been effective for us.

79%

Being active on social media is essential for our business success.

76%

Social media is effective in generating leads/sales.

74%

5.  Social Media Policies 

We also continue to watch the existence of a written social media policy, strategic planning for social media and the monitoring of a company’s products and/or brands online. 

Fifty-nine percent of the 2015 Inc. 500 have either a stand alone social media plan or one incorporated into their marketing/business plan.  Thirty-seven percent have no social media plan in place and 4% are in the process of developing plans.

On a related topic, the executives were asked if their company has a strategy in place in the event of an online crisis (negative attack online).  In 2014, 34% reported having a crisis plan.  This year that number dropped to 27%.

There appears to be some thought that social media issues can be effectively managed as a part of an overall marketing or business plan. There has been little movement when it comes to having a written social media policy that guides online communications within the organization.  These documents typically speak to acceptable online behavior for all employees using social media.  Twenty-three percent of executives reported having an employee policy specifically for social media, perhaps feeling that the companies code of conduct covers this.  Despite well-publicized incidents of employee missteps on social media platforms, written policies are not the norm.  

All executives were asked if their company monitors its brands, products or company name in the social media space.  Forty-eight percent of companies do monitor, down 14 points from last year. Regardless of how they choose to converse with their constituents online, the Inc. 500 will need to be aware of conversation about their company, their products and their brands.  A lack of monitoring could have consequences for companies given the potential for viral communications that social media presents. 

6.  Concerns Using Social Media

This iteration of the survey introduced a question on concerns executives might have regarding the use of social media by their company.  When asked to indicate all the concerns they might have, the biggest concern among the group of typically smaller, fast growing companies is time allocation for social media (41%).  This is followed by concern about their return on their social media investment (36%).  Concerns about legal and ethical issues were far less prominent in the interviews.

Concerns Regarding Social Media Use

% Expressing Concern

Time Allocation

41%

ROI for Social Media

36%

Privacy Issues

33%

Resources for Social Media

31%

Analytics

28%

Legal

28%

Ethical

22%

Conclusion

These fast-growing US businesses are avid users of social media employing a range of tools to connect, engage, advertise and sell.  They are incorporating social media into their strategic planning and are trying new platforms that require less time commitment.

The 2015 Inc. 500 executives are convinced that social media is effective for building brand awareness.  At the same time they are concerned about the amount of time necessary to engage potential customers through these tools and what their return on investment for their social media efforts might be.

They are moving away from long form tools like traditional blogs even though they concede it is the best tool for creating thought leadership in one’s industry.  LinkedIn and Facebook are used most while newer entrants like Instagram are gaining in popularity.

The Inc. 500 companies are still trying to harness social networks and unlock their full potential.  For now, they accept the reality of these new communications tools and make strategic decisions about which ones to use.  Ultimately, the Inc. 500 are consistently turning to social media platforms to generate revenue, find new customers, create an identity and disseminate information.  Social media for business is no longer an option, but instead a strategic reality that needs to find its place in the planning and budgeting decisions moving forward.

 

About the Authors

Nora Ganim Barnes, Ph.D. 

Nora Ganim Barnes is a Chancellor Professor of Marketing and Director of the Center for Marketing Research at the University of Massachusetts Dartmouth. Nora has worked as a consultant for many national and international firms.  Working closely with businesses in the Northeast US, Nora and her students have provided marketing research assistance to hundreds of small businesses. 

She has published articles in academic and professional journals and proceedings, has contributed chapters to books, and has been awarded numerous research grants. Her work has been covered online and in print by Business Week, the NY Times, Washington Post, CNN, Reuters, Wall Street Journal, Fox News, Computer World, Time Magazine and the Harvard Business Review among others. She has been named Co-chair of Research by the Society for New Communications Research. 

Dr. Barnes is a frequent speaker at corporate meetings and keynote at conferences. She can be reached at nbarnes@umassd.edu

 

Ava M. Lescault, MBA

Ava M. Lescault is Senior Research Associate and Associate Director of the Center for Marketing Research at the University of Massachusetts Dartmouth. Ava graduated from UMass Dartmouth with a BS in Marketing and a Master's Degree in Business Administration with a concentration in Marketing Research. She recently completed a Certificate in Marketing Research from the University of Georgia.  Ava has worked on approximately twenty-five extensive research projects and is a published author. Her clients include the cranberry industry, the shellfish industry, a national juice manufacturer, the Massachusetts Department of Agricultural Resources and a Fortune 500 company. She was the first person to hold the position of Senior Research Associate in the Center. Ava can be reached at alescault@umassd.edu. 

Acknowledgement

The authors would like to thank those that made this report possible.  The Inc. 500 companies who responded to this survey were candid and generous with their comments.  They represent all the qualities that make the study of new communication channels for businesses so exciting.  Special thanks are owed to the students from the University of Massachusetts Dartmouth Center for Marketing Research for their endless enthusiasm and dedication to this project.

2015 Inc 500 and Social Media

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