Study shows link between social networks and financial success

Above: The top ten brands engaged in social network media, according to a new study's findings

A new study by enterprise wiki provider Wetpaint and the Altimeter Group revealed a direct relation between a brand's success, and its usage of social networking media.

The study shows that the brands most engaged in social media are also experiencing higher financial success rates than those of their non-engaged peers.

The findings were derived from an analysis of the usage of Facebook, Twitter, forums and blogs, by the top 100 companies from the 2008 Business Week/Interbrand Best Global Brands survey.

After examining the companies and their social media activity levels, the brands were ranked on an "engagement scale", which is how they were evaluated, and later placed into one of four "engagement profiles." Each profile is representative of the number of social channels a brand is involved in, and its level of involvement.

An analysis of the study showed that the brands that were the most engaged, saw revenue growths of up to 10% over the past year, compared to the least engaged brands, which suffered negative 6% losses.

At the top of the list were the "Mavens", or those brands which were heavily involved in seven or more social media channels. The second category is "Butterflies", for brands which are engaged in seven or more social media channels but are guilty of investing in some channels more than others.

"Selectives" is the third rating, given to brands that engage customers deeply, but only in the six or fewer social mediums that they chose. The lowest rating in the survey given to brands is "Wallflowers", and it is reserved for brands with sub-par engagement in six or fewer social mediums.

Unsurprisingly, all of the "Mavens" have occupied the top 10 spots for brands engaged in social media. These maven brands were able to realize financial success despite the economic downturn, which is indicative of the credibility of the study's findings. ReadWriteWeb.com rightly said, that "Although it's difficult to prove for certain that the companies' involvement in social media has led to their increased revenues, the implication behind the new data is that it has."

The list of the top ten brands involved in social media:

1. Starbucks (127)
2. Dell (123)
3. eBay (115)
4. Google (105)
5. Microsoft (103)
6. Thomson Reuters (101)
7. Nike (100)
8. Amazon (88)
9. SAP (86)
10. Tie - Yahoo!/Intel (85)

In case you were wondering like I was, Blackberry received a #12 ranking (due to the #10 tie between Yahoo and Intel), while Apple received a rather dismal #33 despite the success and popularity of their iphone. A simple reason for the disparate rankings of the two competitors can be found in the study's Engagement Profiles.

While Blackberry scored 85 points and achieved Maven status with their use of 9 channels, Apple utilized 6 social media channels, and were placed in the Selective category, scoring a meagre (by their standards) 43 points.