Brand Executives Say Online Communications a Must in Generating     Consumer Loyalty, but Many Question Value of Social Networking

SAN DIEGO—Tweeting and Facebooking may be the rage among the YouTube generation,      but many corporate leaders are reluctant to change their marketing     approaches for the sake of social networking, according to a new     national survey. Most corporate brand executives believe they are better     served by effectively utilizing online communications and traditional     public relations activities in order to build brand awareness among     consumers — their key objective.

Seventy percent of brand experts say they cannot successfully manage     their brands without an effective online strategy and more than     two-thirds (68 percent) characterize online communications as the most     valuable vehicle for generating awareness and brand loyalty among     consumers. Most feel their own Web sites are the key vehicle for     reaching consumers and building loyalty.

Opinions are split on the marketing effect of social media, however,      according to a survey of brand executives commissioned by MiresBall,      a West Coast-based brand design firm, and conducted by Washington,      D.C.-based KRC Research.

While approximately half (52 percent) of those surveyed see social media     as a way to build brand awareness among consumers who were previously     unreachable, and more than a third (35 percent) believe that social     media is making it easier to create customer loyalty, nearly as many (30     percent) disagree that building customer loyalty has become easier     because of social networking.

At the same time, four in 10 (41 percent) of those surveyed feel the     impact of social media is not serious enough to lead to a change in     brand strategy, while roughly the same number believe that social media     presents new challenges for protecting a brand’s integrity, challenges     that necessitate a change in strategy.

“It may indeed be hip to tweet and make Facebook friends for companies     with newer brands looking to build awareness quickly, but many owners of     established brands are not convinced that social networking on its own     is the magic bullet for building customer loyalty,” said Scott Mires,      Principal and Creative Director, MiresBall. “Simply building     awareness is not enough today. What consumers are told — and how they     respond — are most important.”

“Social media could be the next frontier for brand communications since     nearly 80 percent of brand leaders expect to use it in their brand     building activities in the next two years, but for now, marketers are     struggling to figure it out,” said John Ball, Principal and Creative     Director, MiresBall. “In the meantime, brands that continue to share     authentic and relevant stories with their audiences — regardless of the     vehicle — will continue to connect more successfully with their     audiences.”

Other survey highlights:

  • The top three challenges facing brands today are pricing pressures,      lack of brand awareness and rise of strong competitors;
  • Traditional public relations activities provide the best value for       time (48 percent strongly agree) and money (35 percent strongly agree)      invested for brand building, while fewer respondents said advertising       produces the best value for time (31 percent) and budget (24 percent)      dedicated to brand building;
  • Respondents said that online communications provide the best return on       the money spent managing their brand (68 percent), followed by public       relations/promotional events (56 percent) and social media (40       percent).
  • Nearly half of marketers surveyed agreed that the economic downturn       made it more difficult to create brand loyalty (48 percent), while       just over a third (35 percent) used the downturn to their advantage.

“The research shows that brand managers are still trying to navigate     through enormous challenges in the marketplace while simultaneously     building a new foundation for brand growth, mixing both old and new     strategies in hopes of strengthening their brand,” said Peter Shafer,      Chief Executive Officer, KRC Research.

For the full report and a 60-second video, go to:

The 2010 State of the Brand Report included interviews with 189     company owners, senior executives and brand managers, among others.      Survey participants represented small, medium and large companies with     revenues ranging from $10 million or less a year (37 percent) to more     than $1 billion annually (22 percent). Sixty-one percent represented     corporate or institutional brands while 39 percent represented product     brands. Those surveyed were drawn from firms in two dozen industries     including manufacturing, technology, healthcare, energy, entertainment,      travel & hospitality.

About MiresBall

MiresBall is a West Coast brand design firm that develops the strategy,      narrative, and visuals to help companies from innovative start-ups to     established global leaders communicate with clarity and authenticity.      For more information visit

About KRC Research

KRC Research is a leader in communications research. Our ability to use     research to improve communications outcomes — from public relations to     public affairs to advertising — sets us apart from traditional research     firms, as does our approach, which is creative, practical and fast. Our     specialties include research among hard-to-reach audiences, research to     drive media attention, branding and reputation research, and public     policy research. KRC’s clients include Fortune 500 corporations, trade     associations, and non-profits.

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