2. The business of social | Social media tracker 2012 Contents Executive summary What is Wave? The continuing story of Wave Social movements Will data privacy slow social? The Business Of Social Connecting with social experiences The impact: Summary What does this mean for your business? About this report

3. The business of social | Social media tracker 2012 Real Actionable Insight A SOCIAL MOVEMENT THE POWER OF SOCIAL CONNECTING WITH SOCIAL EXPERIENCES

4. The business of social | Social media tracker 2012 Executive Summary The story so far in social networking has been one of incredible growth. But Wave 6 shows that in the future the biggest impact of social media will come from the increasing amount of time people are spending on them. Social networks are now legitimate rivals to all forms of media and will continue to have a huge effect on behaviour and media consumption. Consumers are continuing to move away from increasingly soloed brand websites, viewing them as specialist or one dimensional experiences compared to those offered by social media. Brands will need to reach out to consumers in the social spaces if they are to connect online. Even those data privacy concerns are rising, attachment to social networks is stronger than ever. With over 40% of people saying they are worried about missing out if they don’t visit their social network. As a result users are fully prepared to share their data in return for the benefits that social platforms bring. Social experiences deliver very clear value to brands. Understanding the social experiences the consumer wants AND which of these experiences deliver the brand’s marketing objectives is the key to unlocking this value. This is an important part of making social media a legitimate platform for brand development. Despite the reluctance of many companies to discuss problems, particularly in social media, our research has shown that actually responding to a customer’s issues is one of the most powerful social experiences a brand can deliver. In the future social CRM should be a fundamental part of any brand’s communication strategy. The consumer has many devices through which they can interact with a brand digitally but not all of these devices are a suitable environment for every experience. Tablets and smartphones, for example, have very different strengths. Marrying the right experience to the right device is key to creating a compelling social strategy.

5. The business of social | Social media tracker 2012 What is Wave? Wave is a social media study. Wave has retained the same methodology from Wave 1 to Wave 6, enabling comparison across Waves. All research is conducted by the EMEA Research team in collaboration with the UM network of agencies. We have surveyed 41,738 16-54 Active Internet Users in 62 countries. In Serbia we have covered active internet population from 16-54 y.o., with 500 people within the representative sample, covering 2,013,000 ( 28% of total population ) Our partner in this research in Serbia is the research company Mediana, who was responsible for the field work and quality of sample Why the Active Internet User? Active Internet Users are those that use the internet every day or every other day. Social media is driven by Active Internet Users. They drive adoption of platforms and tools and they will determine which tools and platforms become dominant.

6. The business of social | Social media tracker 2012 INFLUENTIAL 29 countries 17,000 respondents October 1999: Launch March 2002: Launch January 2003: Launch June 2003: Launch September 2003: Launch January 2004: Launch December 2004: Launch March 2005: Launch August 2005: Launch February 2006: Launch September 2006: Launch January 2007: Launch January 2001: Launch May 2003: Launch August 2003: Launch February 2004: Launch January 2005: Launch April 2005: First video uploaded to YouTube July 2008: Launch March 2007: Launch April 2008: Facebook overtakes MySpace in popularity August 2008: Over 100M users October 2008: Launch August 2009: Xiaonei becomes RenRen April 2010: iPad released July 2010: 100M check-ins October 2010: “The Social Network” film released March 2011: 100M members June 2011: Over 200M tweets a day December 2011: Over 845M active users September 2008: First Android phone launch Now more than 3.6Bn images on Flickr June 2009: Launch March 2009: Launch February 2010: Facebook mobile – 100M users August 2010: Groupon is the fastest growing company of all time December 2010: 100M users just 2.5 months after launch April 2011: Valued at >$36Bn June 2011: Launch September 2011: QQ IM – over 700M active users 15 countries 7,500 respondents TEXTUAL 38 countries 23,200 respondents MOTIVATIONAL 54 countries 37,600 respondents SOCIAL 62 countries 42,000 respondents BUSINESS 21 countries 10,000 respondents VISUAL The Story of Wave October 2006: Launch

7. The business of social | Social media tracker 2012 The expanding Wave universe Wave 1 Australia China France Germany Italy India Japan Korea Mexico Philippines Russia Spain UK US Wave 2 Australia Brazil China France Germany Greece India Italy Japan Korea Malaysia Mexico Pakistan Philippines Russia Singapore Spain Taiwan Thailand UK US Wave 3 Australia Austria Brazil Canada China Czech Republic Denmark France Germany Greece Hong Kong Hungary India Italy Japan Korea Mexico Netherlands Pakistan Philippines Poland Romania Russia Spain Switzerland Taiwan Turkey UK US Wave 4 Australia Austria Belgium Brazil Canada China Colombia Czech Republic Denmark Ecuador Finland France Germany Hong Kong Hungary India Italy Japan Korea Latvia Lithuania Malaysia Mexico Netherlands Norway Peru Philippines Poland Portugal Romania Russia Singapore South Africa Spain Sweden Turkey UK US Wave 5 Algeria Argentina Australia Austria Bahrain Belgium Brazil Canada Chile China Colombia Czech Republic Denmark Ecuador Egypt Estonia France Germany Hong Kong Hungary India Italy Ireland (ROI) Japan Korea KSA Kuwait Latvia Lebanon Lithuania Malaysia Mexico Netherlands Norway Oman Philippines Poland Portugal Qatar Romania Russia Serbia Singapore Slovakia South Africa Spain Sweden Taiwan Thailand Tunisia Turkey UAE UK Ukraine US Wave 6 Algeria Argentina Australia Austria Bahrain Belgium Brazil Canada Chile China Colombia Croatia Czech Republic Denmark Ecuador Egypt Estonia France Finland Germany Greece Hong Kong Hungary India Italy Ireland (ROI) Japan KSA Kuwait Latvia Lebanon Lithuania Macedonia Malaysia Mexico Netherlands Norway Oman Philippines Poland Portugal Puerto Rico Qatar Romania Russia Serbia Singapore Slovakia South Africa South Korea Spain Sweden Switzerland Taiwan Thailand Tunisia Turkey UAE UK Ukraine US Vietnam 62 countries 41,738 respondents

8. The business of social | Social media tracker 2012 Welcome to Wave 6 – The Business of Social Social media remains at the top of the agenda for many brands. However, it is clear that as a medium for marketers it’s still very much in its infancy. Popular measures of success, such as “Likes”, posts or Tweets, are no more than proxies for other more meaningful brand objectives. In fact, by definition, setting these goals suggests you may have already confined yourself to creating a one-dimensional social experience. Perhaps this is one reason why so many social media strategies look the same, using familiar platforms in familiar ways to achieve similar goals. With Wave 6 we intend to address this challenge. Wave 5 – The Socialisation Of Brands told us that people want vastly differing social relationships with brands. Wave 6 – The Business Of Social tells us what these social relationships can deliver for brands. Do they make people want to spend more time with the brand, do they make them feel valued as customers, or do they encourage people to recommend the brand to others? Our research has revealed a deeply complex environment where different social experiences meet different marketing objectives. An experience that drives brand advocacy in one category simply creates awareness in another. An experience that encourages brand participation for one person does very little for someone else. Knowing the value of an experience means we can build a social media strategy designed to meet a marketing objective, rather than starting with how to exploit an existing social platform. We believe this knowledge is vital if we are to make social media a legitimate platform for the development of brands.

9. SOCIAL MOVEMENTS

10. The business of social | Social media tracker 2012 Growth in social networking has slowed Global 51.4% Wave 4 Wave 3 45.1% Wave 5 61.4% Wave 6 65.2% 3456 Wave:

11. The business of social | Social media tracker 2012 Growth in social networking has slowed USA 33.1% 48.3% 58.1% 64.5% China 47.4% 51.4% 68.4% 68.9% Russia 64.8% 66.1% 79.8% 77.1% UK 53.4% 55.5% 58.6% 62.9% India 51.4% 62.8% 72.5% 67.1% Italy 24.0% 34.4% 53.9% 61.2% Germany 27.2% 36.6% 37.8% 53.1% Brazil 63.6% 53.9% 74.5% 74.3% Spain 29.9% 46.2% 55.5% 59.6% France 26.3% 43.4% 53.2% 53.5% 3456 Wave: QUESTION: “Thinking about the internet, which of the following have you done in the last 6 months? - Manage a profile on an existing social network (eg: facebook.com)” Some countries. like Brazil, India, Russia, see decline in how many people manage social media profiles

12. The business of social | Social media tracker 2012 Serbian active internet users manage their profile slightly less vs. WAVE5 Macedonia and Croatia are more involved in social media than Serbia Global 45.1% 51.4% 61.4% 65.2% Wave 3 Wave 4 Wave 5 Wave 6 3456 Wave: QUESTION: “Thinking about the internet, which of the following have you done in the last 6 months? - Manage a profile on an existing social network (eg: facebook.com)” Serbia MK CRO 77.4% 71% 87.4% 84.2% Wave 5 Wave 6

13. The business of social | Social media tracker 2012 But as profile creation begins to plateau, active management still grows 49% 88% 75% 77% 81% Wave 1Wave 2Wave 3Wave 4Wave 5Wave 6 QUESTION: “Thinking about the internet, which of the following have you ever done?” Global average

14. The business of social | Social media tracker 2012 Watching video clips on line is the most popular activity in Serbia 19% 91% 46% 71% 76% Wave 5Wave 6 QUESTION: “Thinking about the internet, which of the following have you ever done?” Serbia

15. The business of social | Social media tracker 2012 People are spending more time than ever on social networks With the youngest audiences we can see that social networking is as prevalent as traditional media consumption QUESTION: “Approximately how much time did you spend consuming the following media in the last 7 days?” - Hours per week Television Radio Magazines Newspapers Internet Email Social networks Microblogging sites Mobile phone Blogs Video sites 10 9 6 7 4 6 5 6 13 7 7 7 9 5 6 8 10 6 7 Everyone 16-24 year olds 6 7 Global average 7

16. The business of social | Social media tracker 2012 In Serbia active internet users spend more hours on internet than TV and on mobile phones equally the same as TV QUESTION: “Approximately how much time did you spend consuming the following media in the last 7 days?” - Hours per week Serbia Television Radio Magazines Newspapers Internet Email Social networks Microblogging sites Mobile phone Blogs Video sites 6 5 2 3 8 6 1 5 4 4 1

17. The business of social | Social media tracker 2012 For the first time we are seeing a decrease in some social platforms QUESTION: “Thinking about the internet, which of the following have you ever done?” Start my own blog/weblogs Read blogs/weblobgs Visit a message board/forum Started a topic on a message board/forum Use instant messenger Visit a photo sharing website

18. The business of social | Social media tracker 2012 Blogging: Declining or stabilising in many markets QUESTION: “Thinking about using the internet, which of the following have you used in the last 6 months?” - Read blogs / weblogs Global 55.3% 60.6% 64.5% 63.2% Wave 6 Wave 5 Wave 4 Wave 3 Serbia MK CRO 76.6% 49.7% 64% 56.5% Wave 5 Wave 6

19. The business of social | Social media tracker 2012 Microblogging is still rising but is yet to be fully understood globally Serbia is slightly abandoning microblogging QUESTION: “Thinking about using the internet, which of the following have you used in the past 6 months? – Used a microblogging service (e.g. Twitter, Jaiku)” Global 14.9% 33.2% 42.9% Wave 4 Wave 5 Wave 6 Serbia MK CRO 23.2% 19.1% 34% 15% Wave 5 Wave 6

20. The business of social | Social media tracker 2012 Are we abandoning the brand website? QUESTION: “Thinking about using the internet, have you visited an official company/brand website in the past 6 months?” 13% decrease in 4 years on a global level Significant decrease in Serbia vs Wave5

21. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” Forums Photo/Video sites Microblogs Blogs To get the most from social platforms we need to know what they do best Global average

22. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” In Serbia usage of microblogs and photo/video sharing sites is significantly lower. Key applications are blogs and forums Forums Photo/Video sites Microblogs Blogs

23. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” Official brand websites Forums Photo/Video sites Microblogs Blogs The brand website has specific strengths Global average

24. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” Official brand websites Forums Photo/Video sites Microblogs Blogs In Serbia brand websites have more strengths vs. some other applications

25. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” Official brand websites Forums Photo/Video sites Microblogs Blogs Social networks The social network dominates all Global average

26. The business of social | Social media tracker 2012 QUESTION: “Which of these online applications does a good job when you want to...” Official brand websites Forums Photo/Video sites Microblogs Blogs Social networks In Serbia the domination of social networks vs. other formats is drastic

27. The business of social | Social media tracker 2012 The power of the social network differs across the world Promote yourself Japan Share knowledge Be creative Make contacts for work Earn respect Explore the world around me Learn something new Make money China South Korea Australia Change opinions India Thailand Malaysia Seek other people’s opinions Belgium Denmark UK Canada USA Turkey Hungary Austria Germany Russia Czech Republic Sweden Netherlands Portugal Mexico Argentina Spain Italy Brazil Tunisia Algeria Singapore Egypt Hong Kong Philippines South Africa Poland Lebanon Norway UAE “Hang Out” or waste time Feel like you belong Meet new people Have fun/be entertained Share new experiences Express yourself Keep up to date Lithuania KSA Ukraine Macedonia Serbia Latvia Romania Ecuador Estonia Slovakia Stay in touch with friends Manage my life better Croatia Switzerland Vietnam Taiwan Finland Ireland Greece Chile Colombia Puerto Rico Qatar Oman Kuwait Bahrain France QUESTION: “Which of these online applications [Social networks e.g. facebook.com] does a good job when you want to…?” - By country SELF-IMPROVEMENT ENABLEMENT FUN CONNECTION

28. The business of social | Social media tracker 2012 Learn something new China Change opinions UK USA Russia Tunisia Algeria EgyptLebanon UAE “Hang Out” or waste time Feel like you belong KSA Kuwait Bahrain QUESTION: “Which of these online applications [Social networks e.g. facebook.com] does a good job when you want to…?” - By country And it explains much of the cultural context SELF-IMPROVEMENT ENABLEMENT FUN CONNECTION Serbia Croatia Macedonia

29. WILL PRIVACY SLOW SOCIAL?

30. The business of social | Social media tracker 2012 People are concerned about the amount of personal data online -6.8% I am concerned about the amount of personal data online 65% Global FYRM 79% Croatia 60% Serbia 60%

31. The business of social | Social media tracker 2012 People are concerned but also too attached -6.8% Social networks are integral to my social life 42.2% Serbia 50% Global FYRM 61.1% Croatia 46.2%

32. The business of social | Social media tracker 2012 And people are still sharing personal data Message friends Update my profile Upload photos Find old friends Update my status Find new friends Used live chat Used a “like” button Play games Display my interests Join a group Removed Someone from my friend list Join an Interest group or cause Upload videos Write a blog Affiliate with or become fan of a brand Shared Your location Make Contacts for work/ Professional reasons Purchased something Organise events DatingJoin a Celebrity group 19% 21% 27% 29% 30% 31% 38% 43% 44% 47% 49% 52% 59% 62% 64% Global average QUESTION: “What have you done with your social networking profile?, amongst those who have used a social network in the past 6 months”

33. The business of social | Social media tracker 2012 In Serbia, sharing personal data is not among top activities, our first choice of activities is about staying in touch with our friends QUESTION: “What have you done with your social networking profile?, amongst those who have used a social network in the past 6 months” Message friends Update my profile Upload photos Find old friends Update my status Find new friends Used live chat Used a “like” button Play games Display my interests Join a group Removed Someone from my friend list Join an Interest group or cause Upload videos Write a blog Affiliate with or become fan of a brand Shared Your location Make Contacts for work/ Professio nal reasons Purchased something Organise events DatingJoin a Celebrity group

34. The business of social | Social media tracker 2012 But we are sharing with more people than ever before QUESTION: “Approximately how many people do you stay in contact with in your personal life through the following means?” Social networks Instant messenger Forum/Message board My personal blog Phone Email Face to face Text message (SMS) Post/Letter

35. The business of social | Social media tracker 2012 Sharing personal data is an accepted risk Privacy more important QUESTION: “Please indicate how much you agree (definitely or tend to) with the statements [I worry about missing out on something if I don’t visit my social network] vs. [I am concerned about the amount of personal data that goes online]” amongst those who have created a profile on a new social network. Size of bubble represents size of audience

36. THE POWER OF SOCIAL

37. The business of social | Social media tracker 2012 The value of social experiences A word that is frequently used in social marketing is ‘Engagement’, often when citing the power of social media and the opportunity it brings for marketers. There is nothing wrong with this; it’s a worthy ambition for a brand to try to engage with their consumers. The problem is that engagement is essentially a meaningless term. It could mean anything or everything and is really just used as a proxy for more meaningful brand objectives. With Wave 5 – The Socialisation Of Brands we asked some fundamental questions: do consumers want a social relationship with brands and if they do what kind of relationship do they want? This information has allowed UM to guide clients in the social space by understanding the needs of the consumer first and foremost. With Wave 6 – The Business Of Social we have taken things a step further. Not just understanding the social experience that consumers want but also, crucially, defining the marketing value that these experiences can deliver to brands. This means we can not only identify the right experiences but also those that best meet our marketing objectives. The results of this research have truly been surprising and allowed us to further understand the incredibly diverse world of social media. Also, in the space of social CRM, the results have some profound things to say about how brands connect with consumers to create the most compelling experiences of all.

38. The business of social | Social media tracker 2012 We think about social experiences first I want no interaction Access to news about new developments Discount vouchers Access to fun and entertaining content An opportunity to learn something new A personal response to my issues/complaints Access to unique sponsored events or competitions An opportunity to develop my skills The ability to communicate and share experiences with others Tools to help me express my creativity and make something worth sharing To be part of a brand community The ability to influence product development HIGH INVOLVEMENT LOW INVOLVEMENT

39. The business of social | Social media tracker 2012 Social needs vary by category…. QUESTION: “Thinking about companies that make HEALTH AND BEAUTY products, which of the following statements describes the kind of interaction you want with these companies?” Health & Beauty

40. The business of social | Social media tracker 2012 How we define the value of social experiences Giving you a detailed understanding EDUCATION Making the company more desirable DESIRE Making you feel closer to the company SEEK MORE Encouraging you to try TRIAL Encouraging you to buy TRANSACTION Making you feel valued as a customer COMMITMENT Makes you want to spend more time with the brand INVOLVEMENT Encouraging you to recommend to others RECOMMENDATIONAWARENESS Letting you know about the company

41. The business of social | Social media tracker 2012 And these experiences deliver very different outcomes QUESTION: “Thinking about the interactions that you have indicated you would like to have with companies that make health and beauty products, which interaction is best…?” Health & Beauty

42. The business of social | Social media tracker 2012 The same experiences deliver different outcomes by category QUESTION: “Thinking about the interactions that you have indicated you would like to have with health and beauty companies and with companies that provide services in travel and holidays, which interaction is best…?” The ability to contact travel companies and influence product development The ability to contact health and beauty companies and influence product development

43. The business of social | Social media tracker 2012 This means we can start with an objective QUESTION“Thinking about the interactions that you have indicated you would like to have with travel companies, companies that make health and beauty products, companies that are involved in the fashion industry and companies & artists that make & distribute music, which interaction is best…?” Access to news about music, artists & music events Music “Make me feel closer to the company” Access to the latest offers & discounts on holiday & travel Travel & Holidays An opportunity to learn more about health and beauty Health & Beauty Free money off or discount vouchers Fashion

44. The business of social | Social media tracker 2012 The most powerful social experience? QUESTION: “Thinking about the interactions that you have indicated you would like to have with companies in these categories, [A personal response to issues and complaints] is best at…?” Travel Movies Health & Beauty Fashion Luxury Telecoms Computer hardware

45. The business of social | Social media tracker 2012 The Power of Social Experiences A key element for making the social network platforms accountable tools for marketers is being able to evaluate the value they bring to brands. This effort begins with understanding the intrinsic values of the social media platforms and the power of the experiences they can deliver. Wave 6 – The Business Of Social has begun to answer this question and now allows UM and Fastbridge to plan social strategies from the starting point of brand or business objective. We think this is an important step towards using social media in a more focussed and value driven way. This approach also has implications for social CRM. Social media platforms, such as Twitter, are incredibly powerful tools for customer feedback. Using them in pro-active way to deal with problems very quickly is a proven and powerful driver of loyalty. However, responding quickly isn’t always easy and many marketing teams require input from many other areas of the organisation before dealing with a problem. This suggests that a social media strategy should not just be the sole domain of the marketing department, but rather part of a company wide effort including legal, PR, customer support and others. This requires commitment and investment but our research has shown that those brands that accomplish this will benefit greatly.

46. CONNECTING WITH SOCIAL EXPERIENCES

47. The business of social | Social media tracker 2012 Global data : PC, laptop and mobile devices still the main way to connect QUESTION: “Which devices do you own and which have you used to access the internet in the past 6 months?” - Size of the bubble represents % who own device.

48. The business of social | Social media tracker 2012 People in Serbia now have many ways to connect with the internet QUESTION: “Which devices do you own and which have you used to access the internet in the last 6 months?” Average number of devices owned and used to access the internet Laptop / netbook PC Smartph one (eg: iPhone) Mobile phone Portable MP3 / video player Desktop PC Tablet device (eg: iPad) E-book reader (eg: Kindle) Games console Portable games console Broadba nd Wi - Fi Other

49. The business of social | Social media tracker 2012 In Serbia PC and mobile devices are the main way to connect QUESTION: “Which devices do you own and which have you used to access the internet in the past 6 months?” - Size of the bubble represents % who own device.

50. The business of social | Social media tracker 2012 In Serbia PC remains the most versatile internet enabled device, although we can start to see the areas where smartphones are being increasingly used QUESTION: “Which activities have you carried out using each device in the past 6 months?” E-book reader (eg: Amazon kindle) Laptop / notebook PC Desktop PC Smartphone (eg: iPhone) Tablet (eg: iPad) Mobile phone Games console Portable MP3 / video player Portable games console

51. The business of social | Social media tracker 2012 Globally we can see that smartphone penetration is growing rapidly % own a smartphone >60% 50-60% 40-50% 30-40% <30% QUESTION: “Which of the following devices do you own?” Smartphone (e.g. iPhone, Blackberry etc.)

52. The business of social | Social media tracker 2012 And tablet penetration slowly catching up 12% 11% 13% 11% 4% 21% 17% 12% 10% 8% 20% 28% 19% 12% 22% 19% 17% 32% 16% 8% 14% 11% 14% 11% 6% 8% 2% 6% 10% 18% 12% 37% 9% 6% 5% 6% 11% 12% 14% 11% % own a tablet device >20% 15-20% 10-15% 5-10% <5% QUESTION: “Which of the following devices do you own?” Tablet device (e.g. iPad, Samsung Galaxy etc..)

53. The business of social | Social media tracker 2012 Connecting devices to experiences QUESTION: “You have indicated you own these devices, which of these devices do you think does a good job when you to…” INFORMATION ACTION FUN ORGANISATION Laptop/Netbook P.C. e-book Reader Smartphone Internet Connected TV Portable Games Console Desktop P.C. Tablet device Learn Something New Portable mp3/video player Games Console Get Something Done Find My Way Manage My Life Research Something Thoroughly Make a Purchase Ward Off Boredom Relax Socialise With Others Organise Something Read Content Explore the World Around Me Have Fun/ Be Entertained Play a Game Access Information Quickly Be Creative Watch Content “Hang Out” or Waste Time Mobile Phone

54. THE IMPACT: SUMMARY

55. The business of social | Social media tracker 2012 The impact: summary Our research shows that social experiences can be very powerful, creating strong connections with the consumer. However, it also shows that knowing this is not enough. We also need to understand the value that these bring. These experiences need not be complicated. The consumer is often the most powerful advocate and ally of a brand: Wave 6 - The Business Of Social demonstrates that even simply responding to a customer’s problems creates more loyalty and advocacy than any reward programme could. So do not spend time and investment on a social experience that you don’t know it’s value of or doesn’t meet your brand’s challenges. It’s necessary to look at both the consumer’s needs and your own objectives if you are to build something that not only connects to the consumer but also helps build value for your brand.

56. The business of social | Social media tracker 2012 “Is Social Media working for you? Or are you working for Social Media?”

57. THANK YOU