Social Media Wins the Budget War with 8 in 10 Marketing Leaders Reallocating Funds from Other Channels to Social, Signaling Major Shift in Business Strategy

Rhea-AI Summary

Sprout Social (NASDAQ: SPT) has released its 2025 Impact of Social Media Report, revealing a major shift in marketing budget allocation towards social media. The study of 1,200 marketing leaders shows that 80% plan to reallocate funds from traditional channels to social media, with 87% increasing paid social spend.

The research highlights that social media drives key business outcomes including customer acquisition (60%), customer loyalty (58%), and revenue (56%). Despite this investment surge, only 44% of marketing leaders rate their teams as "expert" at measuring social's business impact. The top performing platforms are Facebook (70%), YouTube (68%), and TikTok (64%), with LinkedIn leading for B2B brands at 70%.

Notably, 81% of leaders are shifting funds from traditional SEO to social tactics, with SOSEO specialists becoming the top hiring priority for marketing departments.

Positive

• 80% of marketing leaders plan to reallocate funds to social media, indicating strong market confidence
• 87% of leaders will increase paid social spend, showing robust growth potential
• 75% plan to expand social team headcount, suggesting strong business momentum
• Social media drives key metrics: 60% customer acquisition, 58% customer loyalty, 56% revenue

Negative

• Only 44% of leaders rate their social teams as 'expert' in measuring business impact
• Less than half of teams integrate social data into their CRM systems
• Disconnect between CMOs and managers on content strategy effectiveness
• Lack of sophisticated reporting capabilities for ROI measurement

Insights

Marketing Technology Analyst

Sprout Social's new research reveals a major shift toward social media investment, strengthening SPT's market position in social media management software.

Sprout Social's 2025 Impact of Social Media Report reveals a significant market transformation that positions the company advantageously in the social media management space. The report shows 80% of marketing leaders are reallocating funds from traditional channels to social media, with 87% planning to increase paid social spending specifically.

This shift represents a fundamental change in marketing strategy across industries, with social media now credited for driving customer acquisition (60%), customer loyalty (58%), and revenue (56%). Perhaps most telling for Sprout's business prospects is that 75% of leaders plan to expand their social team headcount in the coming year, creating greater demand for comprehensive management platforms.

The emergence of Social Search Engine Optimization (SOSEO) as the #1 hiring priority for marketing leaders signals a particularly important trend. With 81% reallocating funds from traditional SEO to social tactics and over half of brands implementing SOSEO strategies, there's substantial opportunity for Sprout to expand its product offerings in this emerging area.

The research also highlights a critical capability gap – only 44% of marketing leaders rate their teams as "experts" at measuring social media's business impact. This presents a significant opportunity for Sprout Social to position its analytics and reporting capabilities as solutions to this widespread challenge.

The data indicating marketing leaders want social insights used across multiple departments (digital marketing 71%, customer experience 58%, customer care 49%) suggests growing demand for more sophisticated, cross-functional social media management tools – precisely the market Sprout Social serves.

• With social search surging, more than half of marketing leaders plan to hire social media search specialists in the next year, ranking it their top recruitment priority
• New platforms, shifting consumer habits, and emerging technologies are driving marketing leaders to move budgets from other channels to social, where the entire customer journey now unfolds
• Despite ramping up investment in social, only 44% of marketing leaders consider their teams “expert” at measuring social’s business impact
  

CHICAGO, Aug. 20, 2025 (GLOBE NEWSWIRE) -- New research from Sprout Social (NASDAQ: SPT), an industry-leading provider of cloud-based social media management software, reveals that marketing leaders are significantly shifting their budget priorities this year, reallocating funds from traditional channels to social media. The 2025 Impact of Social Media Report, which surveyed 1,200 marketing leaders worldwide, finds that leaders believe social media drives key outcomes like revenue, customer acquisition, and customer loyalty. As budgets shift and social’s strategic importance grows, the report outlines how a focus on business-driven metrics and cross-functional data integration will be critical to securing executive trust and investment in the era of social intelligence.

Social media is now seen as a primary driver of business value, shaping every stage of the customer journey. Marketing leaders credit it with delivering key outcomes such as customer acquisition (60%), customer loyalty (58%), and revenue (56%). As a result, 80% of marketing leaders globally plan to reallocate funds from other channels to social media. In addition, 87% plan to increase their paid social spend, and over 80% will increase their spend in influencer marketing and organic social. The investment extends to talent, with three-quarters of leaders planning to expand the headcount of their social teams in the next year.

This increased investment is increasing the demands from leadership, too, particularly the need to effectively measure and prove social’s ROI. However, a significant gap exists in their confidence in social media overall and their team’s ability to tie social to broader business outcomes. Less than half (44%) of leaders rate their social team at the "expert” level in measuring business impact, which is often blamed on a lack of sophisticated reporting. The research indicates that most social teams measure success by engagement (68%) and conversion rates (65%), while leaders say that “expert” teams are more likely to use revenue and efficiency metrics to measure ROI.

“Social media is rapidly capturing a larger share of marketing budgets, driven by its unmatched ability to deliver results that other channels struggle to achieve,” said Scott Morris, CMO of Sprout Social. “With the rise of social search, increasing influence of creator-driven marketing, and effectiveness of advanced algorithms, social platforms empower brands to connect with audiences on a personal level while gaining real-time insights into customer behavior and campaign performance. As social media delivers stronger ROI and attracts greater investment, enhancing data literacy will be critical so brands can harness social insights for transformative impact across their organization."

The report also reveals how CMOs are pivoting hiring priorities to match evolving consumer behaviors, particularly Gen Z’s preference for social media as the first stop for search. Marketing leaders are quickly seizing this opportunity, with 81% reallocating funds from traditional SEO to social tactics. More than half of brands already have a social media search engine optimization (SOSEO) strategy in place, with another 43% actively experimenting. Reflecting this shift, SOSEO specialists are now the #1 position marketing leaders are hiring for, underscoring the rapid impact of social search on business strategy.

Additional findings from the 2025 Impact of Social Media Report include:

• Platform Impact: The top social media platforms for business impact are Facebook (70%), YouTube (68%), and TikTok (64%). However, the most effective platform varies by audience: B2B brands find LinkedIn (70%) most impactful, while B2C brands prefer Facebook (67%).
• Data and Strategy: The majority (72%) of leaders whose teams are experts at measuring social media’s impact say their teams are also experts at understanding how to drive more business impact, underscoring the more data teams have, the more strategic they become.
• Quality vs. Quantity: A disconnect exists between leaders and social media managers regarding content volume. While 69% of CMOs think more posts will increase impact, only 50% of managers agree. Data from Sprout’s 2025 Content Benchmarks Report supports the managers' view, showing that engagement rose nearly 20% even as publishing volume dropped over the past year.
• Cross-Functional Insights: Marketing leaders want social media insights to be used across multiple departments, including digital marketing (71%), customer experience (58%), customer care (49%), and business development (49%). Yet, less than half of teams integrate social data into their customer relationship management (CRM) software.

“Even just two years ago, most brands focused on vanity metrics in isolation. Today, Canva social reporting is much more sophisticated and complex. We are integrating social data into the larger marketing mix by analyzing community conversations on social to learn more about what our audience needs from our product,” said Shirley Tat, Global Head of Social, Canva. “By tracking all of these conversations, we’re able to tag thousands of incoming messages, and eventually close the loop with our community and show them we listened. We launched all of our new products this year based on user feedback. We’ve come a long way in thinking about how social media shifts the business forward.”

To learn more about how to prove social's business value and why all business is social, download the full 2025 Impact of Social Media Marketing report here.

About the data: This report was conducted online by Glimpse on behalf of Sprout Social in the US, UK, and Australia. Participants included 1,200 marketing leaders whose seniority ranged from manager to CMO, and who listed social media among their responsibilities. All surveys were conducted from May 30 to June 20, 2025.

About Sprout Social
Sprout Social is a global leader in social media management and analytics software, built on the belief that All Business is Social℠. Sprout’s intuitive platform puts powerful social data into the hands of approximately 30,000 brands so they can deliver smarter, faster business impact. Named the #1 Best Software Product by G2’s 2024 Best Software Award, Sprout offers comprehensive publishing and engagement functionality, customer care, influencer marketing, advocacy, crisis management and AI-powered, predictive business intelligence. Sprout’s software operates across all major social media networks and digital platforms. For more information about Sprout Social (NASDAQ: SPT), visit sproutsocial.com.

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Contact
Media:
Kaitlyn Gronek
Email: pr@sproutsocial.com
Phone: (773) 904-9674

Investors:
Lexi Johnson
Email: lexi.johnson@sproutsocial.com
Phone: (312) 528-9166

FAQ

What percentage of marketing leaders are moving budgets to social media in 2025?

According to Sprout Social's report, 80% of marketing leaders plan to reallocate funds from other channels to social media, with 87% specifically increasing their paid social spend.

How effective is social media for business outcomes according to SPT's 2025 report?

The report shows social media drives key business outcomes including customer acquisition (60%), customer loyalty (58%), and revenue (56%).

Which social media platforms are most effective for business in 2025?

The top platforms for business impact are Facebook (70%), YouTube (68%), and TikTok (64%). For B2B brands specifically, LinkedIn leads at 70%.

What is the biggest challenge in social media marketing according to Sprout Social's research?

The biggest challenge is that only 44% of marketing leaders rate their teams as 'expert' at measuring social media's business impact, primarily due to lack of sophisticated reporting.

How are marketing leaders adapting to social search trends in 2025?

81% of marketing leaders are reallocating funds from traditional SEO to social tactics, with SOSEO specialists becoming the #1 hiring priority. Over half already have a social media search optimization strategy in place.