News | Ignorance is no defence: businesses ill-informed about social media and digital privacy laws, finds new CIM research

Friday 6th July 2012

Businesses admit to having a very limited understanding of legislation affecting their social media activity, The Chartered Institute of Marketing’s latest study of social media use in business has found.

More than 1,500 companies contributed to the second wave of the Institute’s Social Media Benchmark research, which also showed that half of all companies consider that social media could pose a significant risk to their reputation.

Data Protection and Cookies

Just a third (36 per cent) of all companies who collect and store data from their social media activity are confident that their processes are compliant with current regulation. Furthermore, 30 per cent of all businesses questioned admitted that they currently have no regular data protection training for relevant staff working in social media.  And, despite the recent end of the one-year grace period for businesses to comply with the EU Privacy and Communications Directive, almost 40 per cent of companies currently conduct no cookie compliance audits.

Those questioned also admitted to a surprising lack of understanding of specific regulations pertinent to social media use, with almost half (44 per cent) confessing to having no understanding of how the BCAP Code 2010 affects social media activity and nearly a third (32 per cent) acknowledging a similar lack of understanding of the EC Privacy and Electronic Communications Directive 2011.

Lack of skills and low budgets

The research revealed that, while almost half (43 per cent) of companies identify a significant skills deficit in social media, there is little certainty about how best to address this – suggesting that these important compliance issues may continue to be overlooked.  Most businesses (55 per cent) suggested that they plan to invest in training their own staff in the coming year, but a majority of companies also identified a lack of budget (49 per cent), time (57 per cent) and staff resource (57 per cent) as barriers to enhancing social media skills in the next year.

With budgets stretched, few of those who contributed to the research are planning to either change their recruitment criteria to ensure a stronger focus on digital in the future (29 per cent), or to bring in expertise and resource from specialist social media agencies (20 per cent).

The importance of Management buy-in

Businesses were also questioned on how engaged their senior management are in the company’s social media use.  Respondents suggested that senior management buy-in has a substantial impact on the contribution made by social media to business growth: those with very high management engagement were 50 per cent more optimistic about the potential of social media than those reporting poor management buy-in.  Conversely, those who reported limited management engagement also reported problems with resourcing social media, and suggested that it is not central to their marketing strategies.

Thomas Brown, Head of Insights at The Chartered Institute of Marketing, commented:

“As we see companies continuing to increase investments in digital and social media, it’s encouraging to see so many businesses are planning to train their staff in this area in the next year, and this is certainly a step in the right direction.  But senior management need to ensure that the necessary time and budget is made available to put these plans into action: it’s important to recognise that social media can pose real risks to a company’s reputation, – if your customers are engaging with it, in the very least you need to be a quiet observer, if not a part of the conversation."

"This is the second wave of this research project, and our findings back up what we discovered in the first round: businesses are still struggling to get to grips with social media but the opportunity is there for the taking.  From measurement to monitoring, it’s still very early days for social media in business; what’s vital is that companies continue to invest, train and experiment.  This way, companies can manage the risks and take advantage of the enormous benefits of social media.”

Read the report and supporting materials

The research, which is part of an ongoing project delivering findings every six months, also examined marketers’ personal use of social media, companies’ current and projected investment in and resourcing of social media, the use of monitoring and analytic tools and businesses’ predictions for the future of their social media use.  More information and a wide range of supporting content can be found at www.smbenchmark.com