By Natalie Smith
McKinsey has released a report (PDF) that suggests that better social media marketing could add up to $1.3 trillion to the economy in increased productivity revenue. They argue that there is a direct link between the acquisition of social media enterprises by tech companies like Microsoft and Oracle and their increased operating revenues.
Collaboration is the main focal point of the report, with the majority of gains claimed to result from improved communication between organizations, due to social media. The vast majority of inter-company communication is reported to still take place via e-mail, despite the enormous efficiency savings offered by other more synchronous methods.
McKinsey notes that the impact of social media is considerably expanded thanks to the vast number of people accessing the web through social media-centric portals – especially mobile computing devices. The latest laptops, tablets and their hybrid relatives, ‘tabtops’ allow users to aggregate content through social-oriented ‘feeds’ rather than via lone web browser search bars. Sharing content makes the information contained within more compelling – and mobile browsing makes it easy to share.
The report notes that despite 72 percent of companies actually using social media as a marketing tool for consumers, very few are effectively using the “speed and scale of the Internet” to enhance “communications, knowledge sharing, and collaboration within and across enterprises”. Doing so could increase productivity of “interaction workers” – among them “high-skill knowledge workers, including managers and professionals” – by around 20 to 25 percent. One key takeaway from McKinsey’s report is that all industries stand to gain from social media marketing, to some extent: on average, 66 percent of savings could be made from improved collaboration.
McKinsey categorized savings according to prospective benefits and by industry. Shockingly, “Professional Services” could see 98 percent of a potential productivity boost coming from improved communication. The report highlights the fact that productivity-per-worker varies considerably in such ‘communications-focused’ services. “It’s low in mining,” said Michael Chui, one of the report’s analysts, “but can vary by nine times more in banking.”