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SINGAPORE: Online social networking sites such as Facebook and Twitter are helping millions of people around the world stay in touch.
But more companies are using such technology to stay close to their customers, cut costs and boost revenues.
Experts at Spire Research said costs savings could amount to 50 per cent, once a firm's presence is firmly established online through marketing programmes that leverage on online social media.
Leon Perera, group managing director, Spire Research and Consultancy, said: "Companies can save at least 50 per cent off relevant costs once programmes are mature."
One firm which has embraced this is global data storage firm Net App. It recently put out a marketing video made by its staff on popular video-sharing site Youtube.
Simon Green, vice president & general manager, Net App, Asia Pacific, said: "We are starting to try and track our social media. We got 20 or 30,000 hits on those Youtube videos and that's like 30,000 people that we wouldn't have spoken to in any other media before.
"How much business is it driving for my sales force? I don't know, but it's building brand recognition and branding in the Asia-Pacific is powerful."
Recent data showed that companies that invested in developing large social networks grew revenues by 18 per cent on average in the last 12 months, while firms that did not, saw a decline of six per cent for the same period.
Mr Perera said: "There is the potential for things to move very quickly in the social media space. Over the last two years, we have seen companies that have dabbled in social media and have seen good returns on investment, and those companies are investing more year-on-year based on the survey data we have."
On average, experts said most companies spend below one per cent on social media as a proportion of total marketing costs, but this is expected to increase to the low single digits as more companies reap the benefits of using social media as a marketing tool.
It remains to be seen if this trend will grow sharply as some companies are still cautious about the online social media community, which can be fickle and unpredictable. - CNA/vm
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