The Boom of Social Media in E-Commerce

Describing the use of social media in e-commerce as a “boom” is no exaggeration. Consider these recent statistics compiled by Buffer, The Social Skinny, and Social Media Today:

• 97% of all consumers search for local businesses online.
• 93% of marketers now use social media for businesses.
• Social media use in the U.S. grew from just 8% in 2005 to 72% in 2013.
• Around 70% of brands now use Google+ and Pinterest, from just 4% and 10% respectively at the end of 2012.
• 68% of consumers look up businesses on social media before buying.
• Social media generates almost double the marketing leads of trade shows, telemarketing, daily mail or PPC.
• Of the Fortune 500 companies, 70% have Facebook pages, including nine out of the top 10. 77% use Twitter, and 69% use YouTube.
• 78% of small businesses attract new customers through social media
• 99% of U.S. online specialty retailers use YouTube
• 70% of B2C marketers have acquired a customer through Facebook

Credit : www.statista.com

Social Media Contributes a Measly 0.87% to Your Website Visits

The latest e-Commerce Quarterly by Montate shows surprisingly dismal rates for social media. Only 0.87% of website visits are from social media, contributing a measly 1.08% conversion rate. So are 93% of marketers grievously mistaken in wasting all that time, effort and money on social media?

The answer is a resounding NO. Social media simply does not get the credit it deserves for its hugely effective role in e-commerce. Why? As almighty Google itself points out in their research, “marketing channels [including social] influence the customer at different points in the path to purchase.” This means that other channels, notably search engine and direct website visits, get all the credit for simply being the last step before the actual purchase. By no means does this indicate that social media contributes any less over the consumer’s “path to purchase”.

Social as One Integral Part of the Online Marketing Whole

Google enumerates the steps along the consumer’s path to purchase as awareness, consideration, intent, and decision. Display ads start the whole cycle by creating awareness of a brand when there previously was none. Social media is actually the second earliest channel in the consumer’s path, and primarily influences the all-important consideration step. In all other succeeding channels, namely email, paid search, other paid, referral, organic search, and direct visit, the consumer is probably all but decided on the purchase already.

To illustrate this point, let’s take a look at a very common scenario. A person goes on Facebook to ask everyone and no one in particular where best to order online a particular book. Most suggest Amazon, and the asker simply opens a new tab, types “amazon.com”, searches the site for the book, and buys it. Or maybe someone posts a link to the book on Amazon and the asker actually clicks it, but simply bookmarks it and buys the book at a later date. Or maybe the asker simply Googles “amazon+(title of the book)”. Or an infinite number of other possible paths the asker can take before finally completing the purchase. Of all those possibilities, the only way social will get the credit for the conversion is if the asker clicks the link on Facebook and buys the book right then and there.

So What Does This All Mean in Terms of Using Social Media in E-Commerce?

Social media is most definitely a vital and effective channel for e-commerce. It’s just that practical constraints limit our ability to truly measure the impact that social media has on your sales, except to say that it’s huge.Indirectly, the statistics are overpowering.

500 years’ worth of YouTube videos are watched on Facebook every day. Every second, there are 8,000 likes on photos on Instagram. Worldwide, a whopping 4.2 billion people access social media sites on their mobile devices, or about 60% of the planet’s population. Registered users are quickly approaching the 2 billion mark.

To effectively tap into this vast potential, there are some ways that are better than others. Facebook clearly dominates in reach and effectiveness for social media marketing, and should be the top priority for social engagement of e-commerce sites. But it is also important to have a presence in other sites. YouTube, for example, is the second ranked search engine next to Google. In terms of mirco-targeting your audience, certain social media platforms attract specific audiences better than others. For example, 80% of Pinterest users are female, while 68% of Google+ users are male. For Twitter, the fastest growing demographic is the 55-64 year age bracket, while for Facebook and Google+, it’s the 45-54 year age bracket.

This is just the tip of the vast amount of information and potential that can be capitalized on for e-commerce. Suffice to say, if a business does not make good use of social media, it will go the way of the dinosaur, so to speak.

This post is written by Karel Zamen, an owner of the leading web design and development company “GO-Gulf” in Dubai. He is very passionate about blogging beside his business.