Small World Labs

Study Finds More Than 80 Percent of Companies See Social Media as
Critical to Customer Engagement

Aberdeen Group Report Correlates Adoption of Web 2.0 Technologies and Related Organizational Processes with Increased Business Success

Austin, TX, July 22, 2008 – Small World Labs, a leading provider of enterprise social media solutions and online community building expertise, today announced a recent Aberdeen Group report finds top performing companies - those with the greatest return on marketing investment, highest customer retention and most successful new product development - have made social media a core component of their business strategy. The report, "Customer 2.0: The Business Implications of Social Media," is based on a survey of more than 360 companies and reveals that top performing organizations use Web 2.0 technologies to not only increase customer satisfaction, but to inform product development and marketing decisions through consumer insight.

Aberdeen Group analysts reviewed survey respondents' use of Web 2.0 technologies and supporting organizational processes, then categorized businesses as "Best-in-Class," "Industry Average" or "Laggards." For purposes of the report, Web 2.0 technologies were defined as those "promoting the exchange of user-generated content and information in a manner that simultaneously begets collaboration and individuality;" examples include social networking, blogs, and wikis.

Among the survey's key findings:
• More than 80 percent of companies see social media applications as a valuable channel for customer engagement.
• Nearly 75 percent of Best-in-Class companies improved the accuracy of marketing decisions through social media.
• Seventy percent of respondents plan to increase their budget for Web 2.0 technologies this year.

"Best-in-Class companies recognize that providing a forum for consumers to interact with one-another and with the business itself increases customer satisfaction and provides invaluable insight for new product development and marketing initiatives," said Alex Jefferies, Senior Research Associate in Aberdeen’s Customer Management Group. "In essence, these top performing companies are using customer conversation to create a closed-loop process where the very wants and needs customers express become the foundation of marketing messages and product development."

"This report does an excellent job of describing the way social networking and other Web 2.0 technologies are driving business success by facilitating a greater level of customer engagement,” said Michael Wilson, CEO of Small World Labs. "Enterprise social networking provides an opportunity for businesses to create a community where customers and employees engage in honest dialogue that fuels company direction and product evolution. In a sense, it's the ultimate ongoing focus group."

The Aberdeen Group research also showed that 90 percent of top companies plan to increase the adoption of social media applications. And far from being the latest technology fad, 77 percent of responding companies believe Web 2.0 will be a lasting communications channel for years to come.

This report is now available only for purchase via the Aberdeen Group website.