Thursday, September 24, 2009

Social Media Tools Gaining For Driving Sales

Source: Center for Media Research -- Research Brief 9/24/09

According to the first annual Community and Social Media Study, from the The e-tailing group five out of ten social media tools have been adopted by more than 50% percent of brands and retailers, with the Facebook Fan Page leading the way at 86%. In addition, the study found three-fourths of the survey respondents feel brands have accelerated their use of, and commitment to, community and social media in the past six months.

The study found that the penetration of social media tools within brand and retailer organizations is extremely high, given the length of time these tools have been around.

The top three concerns of marketers and merchandisers related to social media:

  • Brand degradation fear - "people can trash my products in front of large audiences"?
  • Competence fear - "I am using outdated marketing/merchandising techniques"?
  • Competitive fear - "customer's inclination to leave their site to find a more socially-engaging site"

These motivators, which drove the last wave of social media adoption, will also be driving the next wave in the coming year, says the study. Over the next 12 months, study respondents say they plan to adopt:

  • Facebook Connect (31%)
  • Social Listening Tools (31%)
  • Customer Reviews (26%)
  • Product Suggestions (26%)

The study also found the primary goal for adopting social media was:

  • Customer engagement (39%)
  • Mobilizing advocates to drive "word of mouth" (30%)
  • Increasing brand loyalty (21%)

Lauren Freedman, President of the e-Tailing group, says ?"The integration of community and social networking within e-commerce has reached critical mass... failing to engage consumers via community and social media will have brand and bottom-line implications... "

Regarding advocacy and word of mouth (the #2 goal of using social media tools), the study found that Facebook is considered by brands and merchants to be the "single most effective tactic in mobilizing brand advocates and influencers to spread the word about products/services."

However, when it comes to driving sales and customer engagement, customer reviews came out on top by a wide margin, with 78% of those polled listing customer reviews as the #1 social media tool for generating sales and 61% listing customer reviews #1 in driving customer engagement.

Darby Williams, VP of Marketing at PowerReviews, says "... we believe a new marketing baseline has been set with customer engagement and interaction taking center stage."

Please visit the e-Tailing group website here for more information about the study. In addition, A free PowerPoint presentation of survey findings is available to download directly from PowerReviews.