Forrester says social doesn’t drive online sales, and why that’s fine

Research recently released by Forrester entitled “The Purchase Path of Online Buyers in 2012” indicates that email and search dominate the online space in driving online sales. Social media, says the report, drives less than 1% of online sales.

As reported by Marketing Pilgrim:

  1. Paid search matters most for new customers
  2. Email matters most for repeat customers
  3. Social tactics are not meaningful sales drivers

I can hear the howling from the rooftops now. This is complete anathema to those who argue that traditional marketing in its various forms is “dead”.

Last year I was sceptical about Forrester’s 2011 report given that the data was taken from the clients of a single marketing agency – and frankly most of my concerns remain around methodology and report scope. At the same time, there’s food for thought here. Here’s my take:

1. Social is media, not a medium

We need to stop thinking about social media as a silver bullet, stand-alone silo and approach communications as an integrated discipline where paid, owned and earned media all work together to drive results.

Edelman Media Cloverleaf

Earlier this year I suggested that transmedia storytelling is critical, and that we need to stop thinking of social media as a goal unto itself. A few months later, in my presentation on six essential shifts in social strategy at BlogWorld New York earlier this year, I argued that we (as digital communicators) have reached a point where “shiny objects dominate discussion” and that we need to start thinking about it as an enabler and partner to other communications functions.

Yes, there are specialized skills and knowledge that people require to operate effectively, but that doesn’t mean we should put social on a pedestal – we need to think about integration, not isolation.

Communications functions need to work together. Nearly three years ago, I obsessed over another Forrester report on the social media marketing ecosystem, which the pros and cons of paid, owned and earned media. A key “pro” of paid: reach. Relatively few companies have achieved any kind of reach in social media at this stage; those who have, have mostly done so by paying for it. The whole point of thinking of this as an ecosystem: the pros and cons of each element balance each other out.

2. Sales isn’t always the objective

Thinking of sales – and in this case, just online sales – is narrow-minded. Essential when it comes to effective research, but not in consuming it for broad communications trends. However, I’ve long argued that social media’s strong point isn’t in final point-of-sale, low funnel conversion.

What about long-lead sales (as I said in response to last year’s version of this same report, last-click analysis is very flawed - and much social traffic via apps often displays in web analytics as direct traffic, for that matter)? What about cost avoidance? What about driving people to sign up to receive information over time? What about customer retention, loyalty and advocacy? More broadly, what about organizational reputation (where PR plays strongly too)?

There’s a lot more to communications than just driving sales, and ignoring that as a communicator is blinkered.

3. Of course email matters

I hate email spam as much as everyone else. You know what I don’t hate, though? Email that I’ve signed-up for. As Marketing Pilgrim noted, Forrester’s report shows that 30% of repeat sales involve email in the process. I’m not at all surprised to hear that email is highly effective for repeat customers – they’ve said they want to hear from you.

 

4. Social can underpin and enhance other functions

Thinking of Facebook and Twitter as the extent of social is narrow-minded – on-domain blogs and rich media content, for example, can both live on-domain and drive traffic to those domains (not saying that content marketing falls entirely within social, but there’s a significant overlap nowadays), and in doing so can affect search. Meanwhile. studies have shown that positive reviews significantly increase the likelihood of people purchasing products online – fueling the comparison shopping engines in the chart above. Social can help to drive that – whether through advocacy programs or through tools like Bazaarvoice.

So is this study going to put the cat among the pigeons? Sure. Are the snake oil salesmen going to come out swinging? Oh yes.

However, those of us who work in the space and driving results at scale know that:

  • There’s merit to the picture Forrester paints here
  • This is one piece of the much bigger communications puzzle, and there’s more than meets the eye.

 

8 comments
MicroSourcing
MicroSourcing

It's interesting how 30% of repeat sales involves email, which means that email marketing can be helpful when done right.

MarryJohn
MarryJohn

Presenting brand consistently across all marketing platforms is a critical part of transforming business into an extraordinary brand, and social media branding is becoming more important every day.Marry@Ebizsubmit

Taylor Danowski
Taylor Danowski

This post caught my attention because I, along with many others from my young generation, hear often that traditional marketing is "dead." I have always agreed that there are more outlets and mediums now, and that all can be used to help or hurt an organization, but I believe purposeful marketing will always be essential. It is surprising but logical that social media drives less than 1% of online sales. Mere conversation about an organization or product will not make people rush out to buy it. It will, however, push people to possibly read more or research the product or organization to see what the buzz is all about. That is why, in the world of public relations, I find it so crucial to monitor and manage every social media platform a client's product or organization appears on. Social media comments about a product will not sell it, but it will spark people's interest. That is where strategic marketing comes in. Social media functions only as a first step in a tedious and research-based process to sell.

amlikethewind
amlikethewind

I'd be interested to know the demographic breakdown.  We were out shooting a story yesterday about holiday layaway and took the opportunity to quiz retail employees on their mobile habits.  Do their own stores reach them as customers?

25-year-old assistant manager of a big box explained how he doesn't watch tv, thinks Facebook is for his parents, and listens to satellite radio in his truck.  The way he is reached as a customer: via email, viewed on his phone.

Trackbacks

  1. [...] “Email and search dominate the online space in driving online sales. Social media drives less than 1% of online sales. This is complete anathema to those who argue that traditional marketing in its various forms is ‘dead.’ There’s food for thought here, and four key takeaways:” http://davefleet.com/2012/09/forrester-email-search-drive-online-sales-social/ [...]

  2. [...] 3.“Forrester says social doesn’t drive online sales, and why that’s fine” [...]