Study: Social Media Just Doesn't Sell
Social is looking a little tarnished lately.
With the share price of behemoth Facebook looking anemic and a handful of voices questioning the impact of advertising on such sites, the enthusiasm for social isn't at quite the fever pitch it once was. And maybe that's as it should be according to a new study from Forrester.
The research tracked the origins of 77,000 purchases to determine exactly what pushed customers to buy. The answer was almost never social sites. Only a measly 1% of sales came from the likes of Facebook, so what did work? Old stand-bys like e-mail marketing and search, Mashable reports:
E-commerce websites still convert more highly than any other channel, accounting for 30% of transactions. Thus it's smart for retailers to promote their domain names as much as possible.
Following direct visits, organic search and paid search are the two biggest drivers of purchases from new customers, accounting for 39% of new customer transactions. That’s because the web continues to be a useful tool for what Forrester calls "spear fishers"--consumers who know what they are looking for and find it through search.
For repeat shoppers, e-mail is the most effective sales influencer: Nearly a third of purchases from repeat customers initiated with an e-mail. As such, businesses should up their efforts to collect e-mail addresses, and tailor their e-mail marketing messages to each recipients’ device and prior purchase behavior.
But while the study results might make you think more carefully about exactly how much your social-media marketing efforts are worth in terms of time and dollars, as the MIT Sloan Management Review Improvisations blog points out, the research has limits and isn't a total indictment of involvement in social sites. The post does a solid job of putting the findings in perspective, reminding small business owners that, "the research did not track small businesses, which…do perform better with social commerce, particularly in Facebook stores." It continues:
Another important factor is that the research does not comment on whether those social sites were trying to deliver sales. It measures how social is being used now--and more often than not, social sites are not set up to produce direct sales. It also does not show if any sites that were set up to produce direct sales were done in any kind of effective or ineffective manner.
While investing in social may help you build brand awareness and inform customers of new developments, the Improvisations blog notes, that doesn't minimize the harsh realities revealed by the Forrester research.
"We think the research does show precisely what it says: that at this point in time, sales are not coming directly from social sites. This fact should be an important consideration in how businesses think about their social business activity: in short, don't count on it for direct sales," concludes the post.
Do these findings make you reconsider how much to invest in social?