“Social tactics are not meaningful sales drivers”, according to a Forrester research report from a few years ago.
They analyzed over 77,000 eCommerce orders and determined that less than 1% of sales were from social media.
Ouch. That’s a pretty damning statement.
If they’re finding it tough to sell with social media in eCommerce, just imagine what it would be like to use it to sell intangible services or something complex and technical that has a longer sales cycle.
Even a nice discount wouldn’t help that.
Does that mean you should just focus on ‘fans’ instead?
Here’s why, and how you should use advertising instead.
Why Companies Underinvest in Social Media
“Oh, I wonder what Cox Communications is up to? Let me go check their Facebook page to find out.”
Said no one ever.
That’s not just because Cox is the worst (they are).
That’s because social media is serendipitous. As a general rule, you don’t search stuff out – especially branded, commercial stuff – on Facebook (or any other social platform). Instead, interesting stuff finds you.
Compare that to Search (both organic and paid), which is based on intent.
People go there looking for something specific (like ‘Cox Communications customer service’).
That means first and foremost, intent-based interactions will always convert higher.
Marketing efforts become easier to track and report because of the shortened time between initial interest and purchase. Meaning somebody who’s already familiar with your brand and their need for it, types your product into Google and enters their credit card information – all within one sitting (or ‘session’ for you analytics geeks).
So if social media is a lousy sales driver in comparison, how can you still use it to increase revenue?
How Social Media ‘Assists’ Sales
Waaaaay back in 2012, Forrester Research poured water on the social media fire with their aforementioned report that less than a percent of sales were from social channels.
Today, direct social conversions (compared to other channels) still haven’t improved all that much. And keep in mind, this is for eCommerce – arguably the one industry where social should be the strongest
Does that mean social media is worthless? Or that it’s impossible to use it for anything other than meme’s and insulting Cox Communications when their rep forgets to show up during the 8-hour ‘window’ they provided, leaving you without the internet for another 4 days?
Toy company Step2 was featured in the Wall Street Journal because they were able to increase sales 130% year over year, and 300% from Facebook users.
Software company Moz also revealed some astounding stats when the founder (and my man crush), Rand, revealed some growth numbers over the past few years after raising $18 million.
The most interesting was that they had acquired ~85% of their customers up to that point organically (primarily SEO & social), without a huge ad spend or sales force common for similar companies of that size, thanks in large part to their MASSIVE audience.
The point then, is that social media does sell. Just not always ‘directly’.
What typically happens instead, is that social media ‘assists’ conversions through helping people find out about your brand, and building trust (that whole ‘engagement’ thing) prior to purchasing. That might take days, even weeks, before somebody comes back to your site and purchases anything.
And without diving into a deep, murky pool of how attribution modeling works, it’s terribly difficult to see exactly where and when social media assists conversions that look like they originated from somewhere else.
But fear not, because there are a few clear-cut ways to use social media to increase sales (and be able to track results accurately).
We just need to change our approach a little bit.
How to ‘Sell’ with Social Media
Social media marketing may be “serendipitous”, but it does effectively produce results – just not always the ones you’re looking for as a direct line item on your P&L.
But you know what social is good for?
Driving Leads Indirectly
If your product costs upwards of a few hundred bucks, chances of selling it directly via social media are slim to none.
This is especially true for a more ‘consultative purchase’, which takes a massive amount of education and information for customers to build up enough trust before pulling the metaphorical trigger.
In these cases, the goal is to generate initial leads with something they’re actually interested in, giving you the opportunity to nurture them over time before they’re ready to become a customer.
HubSpot is a perfect example. Their customers will spend roughly ~$10,000 (and up) annually. The chances of someone checking in with friends on Facebook, clicking on their ad – without any prior interaction – and then passing over a credit card for that amount will never happen.
Instead, they use something this person might be interested in, like a free ebook around a problematic topic, to grab their attention and build some interest.
Then after generating that lead, they can segment and follow up with a message that’s a little more targeted, and a little more commercial:
But what if a content offering doesn’t do anything for YOUR customers or industry?
What if they need something a little more engaging to cough up their email address?
Let’s make it a game!
Postcard & Tag does an excellent job creating a whimsical quiz for travelers that engages and entertains. But at the same time, drives their business goals.
Another simple spin on this is through a giveaway, contest or promotion.
Here, iHerb.com is running a $50 shopping spree for Mineral Fusion products.
You can make simple giveaways better by getting the other brand or product – Mineral Fusion in this case – to pitch in their products gratis in exchange for the extra promotion and awareness. If you can free up resources behind running giveaways, there’s no limit to the amount you could run.
Beyond basic giveaways, NBC Sports raises the stakes for interested filmmakers.
$10g’s ain’t bad. But the massive exposure you (and your content) could get from being aired live on NBC Sports could open some serious doors.
Think that sounds good?
Check this out:
OctaFX, an online foreign exchange trading platform, is giving away a Tesla.
Um… yes please! I would give up my social security number for that.
Driving Sales Directly
If your product, and the sales, it is possible to drive sales through social media.
Difficult, but not impossible.
And as always, these campaigns shouldn’t exist in a vacuum. The ‘blocking and tackling’ is the ability to track the source or medium.
Kate Hudson’s Fabletics does a great job capitalizing on the New Year resolution fitness trend with a special offer, quiz (remember that?), and shortened Bitly tracking link to help provide the ability to compare channel performance later.
Facebook’s peerless ability to match demographics and interests makes it a powerful channel to generate new interest for seemingly obscure things.
Like say, log homes.
Eloghomes, despite a wordy description, throws in a few phone numbers at the end for those with questions.
Basic call tracking can now transform what’s commonly underappreciated and understaffed – the Customer Service department – into a profit center.
But why stop there?
The savviest companies, like Udemy, create their own discounts, packages, or deals for each specific channel, making New Revenue Generated black and white:
And of course, Facebook already provides the ability for most consumer or transaction-focused brands to sell directly through the appropriate ad type.
New Uggs. Great price. Free shipping and returns. Buy here.
Nobody wants to invest in a marketing strategy that yields a pathetic sales conversion rate of “less than 1%”.
So why are some companies still investing in their social media engagement? And why does it seem to be paying off for them?
Because they’ve (a) recognized how the mechanics are different from other channels, (b) analyzed how those strengths & weaknesses compare, and (c) changed their approach accordingly.
The best marketing and advertising, after all, isn’t one-sized fits all. But a tailored, bespoke one that provides the best message to the right prospect at the appropriate time.