How social commerce might just save social
2012 represents the largest investment by brands in social channels, technologies and platforms to date and the forecast for 2013/2014 is even larger. eConsultancy’s most recent survey reports that 51% of companies changing their social media budget are planning to increase it by over 20% in 2013, with more than 9% doubling their budgets. (UK Search Engine Marketing Benchmark Report 2012).
According to the CIM’s Social Media Benchmark wave two report, of the 2,000 UK and Western Europe marketers surveyed, 79% of them have brand Twitter feeds, 69% are on Facebook, 66% are on LinkedIn, 60% are on YouTube, 53% have blogs, 25% have proprietary online communities and 22% have Google+.
That’s a lot of social media, but not necessarily a lot of understanding about its effect or value.
From conference rooms to online forums, the same question is being asked, time and time again by brands and agencies alike – how should we measure the value of social? It’s like Groundhog Day and the conversation doesn’t appear to be moving on. Or is it?
In Barclays’ May 2012 Social Commerce report, it’s forecasted that in the next five years, influenced sales (sales that have been positively influenced by word of mouth and social) will be worth £3.3 billion, up from £1.4 billion in 2011. That’s a big number and probably why it’s worth trying to hone your social strategy to achieve maximum efficiency, reach and engagement and to keep investing in social. How we perceive a brand as a consumer, our relationship with them and how we purchase them has fundamentally moved on and the rise of a more social and connected consumer sits at the centre of this change.
But it’s perhaps the other forecast within this same report, relating to the value of social commerce, that we should be focusing on. Here, we will see an increase within the same period from £210 million to £300 million in direct sales. While the amount by value might be less, it does show that social commerce is a big part of our collective future.
I recently spotted an article about social commerce and some great examples of not just emerging platforms or technologies like Mulu.me, Referly, Mark. and Wikets, but the evolving sales models that put the direct value of social influence at the heart of the business model. While the ability to scale these platforms and models represents the biggest challenge for all involved, perhaps it’s time for brands to start thinking differently about how they maximise the opportunity given to them by their customers?
Consumers are keener than we think to use social not just to shape a view of a product or service, but as a way to buy. The confidence they have in their purchase decision is bolstered by a sense that others are doing the same. Social proof (where a person will look at the action of others to inform their own action) will drive sales and begin to answer the question of the value of social.
Where the traditional role of social as a way of improving brand sentiment, increase affinity and create positive word of mouth has failed to date to give a definitive answer on the value of social, social commerce may just overcome that problem and give us what we all really want; the ability to attribute social activity, effort and spend directly to sales and conversions.
Chris Buckley is director of social engagement at TMW.