The Business of Social Networking

The last time I wrote about online social networking in October of 2009, I described it as the biggest marketing buzz of the past several years. Here we are two years later, and the hype hasn’t let up -- arguably, it has increased. There has been some speculation and recent media stories about the phenomenon peaking--but has it? Our results show that usage levels continue to increase dramatically and that consumers have started to make the transition to letting corporations enter their social world. This has dramatic implications for marketers across Canada.

According to Ipsos’ most recent Canadian Inter@ctive Trends Report special feature on Social Networking, one-half of all Canadians (50%) and the majority of online Canadians (60%) now have a social networking profile. Broken up by age group, that number represents a hefty 86% for 18 to 34 years, tapering down with older groups - 62% for those aged 35 to 54; 43% for those 55 years and older.

While the number of Canadians with a social networking profile has only increased by 4 percentage points in the last two years, what is more significant is the dramatic increase in the frequency in which they are using social networks. Nearly one-half of online Canadians (45%) are now visiting a social networking site at least once a week, and 30% visit daily, which compares to 35% who were visiting weekly, and 19% who were visiting daily this time last year. Momentum continues to grow as well, as 32% of those who have an online profile admit they are using it more than last year vs. 15% who say they are using it less (53% say their usage is the same). Another recent special feature report on Smartphones shows that 48% of smartphone users use their phone for social networking-up from 29% the year before! The point here is obvious-Canadians spend A LOT of time social networking-capturing between one-third and one-half of ALL online hours spent.

In Canada, Facebook remains the dominant player in social networking. The vast majority (86%) of Canadian social networkers has a social networking profile with Facebook, a proportion that has remained relatively unchanged since 2009 (85%). But Facebook’s dominance may be challenged from the significant growth of both Twitter and LinkedIn over the past year. During that same period, the number of Canadians with a profile on Twitter has grown exponentially from almost none (<1%) in 2009 to 10% last year, and 19% today. The proportion with a profile on the professional social networking site LinkedIn has more than doubled during the same period from 6% in 2009 to 14% today.

A new era has dawned in the social networking space--the first five years was about building awareness and usage around socializing, and consumers responded positively. I believe that the next five years will be about commercialization of social networking. Our recent findings show that nearly half (48%) of Canadians with social networking profiles ‘like’ or ‘follow’ at least one brand or company through their social networking site. And consumers follow an average of six brands in the social networking space. This is a brand-new phenomenon--because up until recently, the opportunity for corporate engagement in this space had been limited primarily to links and banner ads. Companies who understand, and enter this space will gain a whole new way of interacting with and engaging their customers and prospects. Our Canadian Inter@ctive Trends Report has been tracking online behaviours of Canadians for over 15 years, and we will continue to monitor and report on this trend in the months and years to come.