Does Social Media Work For Business?

CMO's agree that social media has an impact on sales

Image Source: Forbes

It is safe to say that almost every business you encounter today can be found on Facebook, Twitter, Pinterest or are at least reachable in some social and mobile circumstance. The answer to our question is closer to us than ever and its speed all depends on the swiftness of our keyboard strokes. When a new business is incepted, it seems as though their Facebook and Twitter accounts are even pieced together before any foreseeable plan for a website is done. It is no doubt that being on social media can help develop, shape and optimize a brand’s recognizable voice and influence on their followers. However, the question must be asked towards those businesses investing millions of dollars into their social media efforts, “Does investing in social media directly have a positive effect on sales?”

A recent survey conducted by Bazaarvoice yielded that 3 of 4 CMO’s believe social media has a measurable impact on sales. (Olenski, 2012) There is no doubt that social media is here to stay, and many can agree that it can help businesses predict consumer trends, develop stronger listening strategies and lifetime customers; but does it drive sales?

A study released by PwC inferred that Canadians and global consumers alike are not ready to use social media as a buying channel, but rather use it to share information with friends. Only 7% of Canadians, 8.5% of Americans and 12% of the global population currently use social media as a shopping tool. (Powell, 2013)

Furthermore, platforms like Facebook have made it increasingly hard to market your business on social media. They have created stipulations that let only 1-5% of your fans see your posts naturally; and in order for more to see your posts, you must first pay a premium of $5-$300 per post. If you want to read more on why Facebook is a bad investment for Small Business, head on over to Forbes. (Dekel, 2013)

Conversion Rates by Traffic Source

Image Source: Heidi Cohen Blog

Personal Opinion

In my personal opinion on this issue, and having had social media marketing experience for a brand, social media is a good option for building brand awareness. However, I would not say social media has really helped convert fans into paying and repeat customers. What I do suggest is that every business must first and foremost have a usable website. Websites can create networks in themselves over time and with good work ethic and optimization. I also suggest that businesses invest in search marketing as well as email marketing as they are the two greatest inbound traffic sources and sales converters. Lastly, in whatever avenues chosen, make sure you are creating relevant and original content towards your target markets. While social media may not provide revenue dollars directly, they definitely can aid in your customer’s decision making journey.

Sources:

Cohen, H. (2012, August 14). Social Media Doesn’t Sell. Retrieved January 28, 2013, from Heidi Cohen: http://heidicohen.com/social-media-does-not-sell-research/

Dekel, E. (2013, January 21). Facebook Pages Are a Bad Investment for Small Businesses. Retrieved January 28, 2013, from Forbes: http://www.forbes.com/sites/elandekel/2013/01/22/facebook-pages-are-a-bad-investment-for-small-businesses/

Olenski, S. (2012, August 21). Three Of Four CMOs Say Social Media Impacts Sales. Retrieved January 28, 2013, from Forbes: http://www.forbes.com/sites/marketshare/2012/08/21/three-of-four-cmos-say-social-media-impacts-sales/

Powell, C. (2013, January 28). Social Media Not A Good Sales Channel..Yet: Study. Retrieved January 28, 2013, from Marketing Magazine: http://www.marketingmag.ca/news/media-news/social-media-not-a-good-sales-channel-yet-study-70672

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