The value of social media marketing has been debated, questioned and analyzed since the first tweet, and questions continue to mount, particularly in the realm of direct response.
IBM released an online retailing report covering the Black Friday holiday shopping weekend last fall. The report found that social media delivered low click through rates during the weekend and contributed to only 0.34% of sales. Monetate released its Ecommerce Quarterly Q1 2013 report. It found that only 1.55% of all direct traffic to ecommerce websites came from social media. That traffic had a conversion rate of less than one percent.
If this is true, social media should probably be struck from every marketing plan out there, but that’s not the case. Instead, this approach shows two problems with how we define value in marketing channels:
- Value is not just in the last click. Social’s role is best played earlier in the path to purchase in awareness building. It’s also clear that word of mouth plays a role in 80% of all purchase funnels according to Forrester (as Monetate’s report points out). Looking just at last click undervalues the role social plays.
- Social media is not where intent is at its highest. Discovery in the social space is often serendipitous. Unlike search where consumers are actively seeking out a product or service, social referrals often come from friends or brands in a news feed or timeline. It’s not information one was actively seeking out. Plus, consumers are in the mindset of interacting with friends, not necessarily shopping. Instead, they add it to their consideration set and take a direct response action, such as searching, when they’re ready to purchase.
Social is Part of an Ecosystem
Social media is not a replacement for traditional direct response channels, and it can’t be held to the same expactations. It’s an addition to them, an extension to make direct response channels like search and email more effective:
- Influences Search – Social informs search results, being used by algorithms as a litmus test for content quality, including brand content. Social can be used to improve search results, so when purchase intent is shown, your brand is better positioned in results.
- A Custom Site Experience – Adding social sign-in to a website allows brands to deliver more customized experiences based on a user’s social profile and content a user’s friends have shown a propensity to like. All of this allows a brand to deliver a tailored site experience, leading to more time spent on the site and a more engaging experience.
- Word of Mouth and Referrals – The true power of social media is in its ability to add speed and scale to word of mouth. Providing reasons and means for friends to discuss a brand or product means a message that carries more weight than when it comes from the brand. It also allows brands to use their existing customers to help them identify qualified buyers, meaning less waste on mass marketing channels. This also plays into referrals and reviews. Inviting customers to review products or services means greater conversion rates when someone eventually decides to research a purchase.
- Audience and Content Segmentation – Effective marketing means being more relevant, and the social space allows brands to learn more about customers, including what interests them, what frustrates them and what they want from products and services. Having a greater understanding of your customer means being more effective everywhere from the content you create to the terms you target in search. It also allows you to treat your audience segments as the unique, nuanced groups that they are by delivering content custom to their needs.
The stats show social media may not be a great direct response channel, but it doesn’t have to be. It’s effective in so many other areas that forcing it to be strong where it may be weak means overlooking its true potential for your business. Instead, use the strengths of social to make your holistic marketing ecosystem more effective.