A Facebook post or YouTube video might play a part in a sale at some point, but a phone call, filling out a form and other steps typically get the credit for moving potential consumers down the funnel. These steps are closer to the conversion. This difficulty giving social presence any sales credit prompted marketers to switch their social metrics from direct sales to the more amorphous metrics of brand awareness and buzz.
New research, however, indicates that social media may finally be directly delivering the paying customers vendors have longed for.
Internet Retailer’s “2015 Social Media 500,” a study of 500 leading merchants’ use of social media, reveals that retailers’ increased efforts to build social media audiences (follower numbers were up an average of 33% on Facebook from 2013 to 2014) are paying off.
In 2014, total social commerce sales that could be tracked to social networks hit $3.30 billion, up 26% from 2013’s $2.62 billion, which is quite a leap. The study also revealed that overall traffic to retailer websites originating from social networks ticked up 7%. Could these increases be the long-awaited indicators that social selling will finally take off?
A positive trend in social selling has been echoed by other reputable studies. According to leading statistics provider Statista, by the end of 2015, social selling will amount to $30 billion worldwide, a 50% increase over 2014’s $20 billion. (Keep in mind that the Internet Retailer study above gauged only 500 selected retailers, not the entire market, hence the difference between $3 billion and $30 billion.)
Key Takeaways: Many marketers will remember the early 2000s when doubt and suspicion surrounded online Christmas shopping. When online gift sales accounted for 5% of all sales, headlines like “Can It Last?” and “Trend or Here to Stay?” abounded.
Fast-forward to Christmas 2014 and Internet sites are the number-one place consumers go to buy gifts. Discount department stores like Walmart were a close second. Could social selling follow a similar trajectory?
If it’s just a matter of work, social selling could get a solid foothold worldwide.
Twitter, Facebook and Pinterest (and even Amazon.com) are busy developing buy-type buttons and promotions to help marketers track sales directly to the platform. Pinterest is already gaining traction as an ad platform with its rollout of promoted pin native ads. Provable ROI for social media will mean more budget attributed to it. Networks design these buy buttons to reduce the steps it takes for website visitors to buy items from the store.
Social platforms are clearly aiming for revenue that isn’t only ad-based. Does that mean social media will become more like an affiliate, taking a small portion of every sale they send to a vendor?
Also, some experts warn that social media’s primary role as a relationship facilitator will be damaged if too much commerce comes in. Most likely, consumers will vote on the compatibility of shopping and social media with their dollars.