For all the buzz created by social media, a new study shows retailers may be barking up the wrong tree: ForeSee Results reports that social media drove just 5% of visitors to retail websites. On the other hand, "promotional emails, search engine results, and even advertising are more influential," it says.
In fact, the study found that more traditional marketing techniques not only generated more traffic, they also they deliver better-quality customers. "Some of the most satisfied site visitors arrived at the site because of previous familiarity with a brand, promotional emails, word-of-mouth, and product review websites," it says in its report.
Survey respondents were asked what factors were the primary influence to a store's website, and here's what they found out:
- 38% say it is familiarity with the brand.
- 19% say it is due to promotional emails.
- 8% say it is due to search engine results, word of mouth, and ads (newspaper, TV, radio or magazine).
- 5% said social media was the primary influence.
- 3% cited blogs.
- 2% named both shopping comparison websites, and product review websites.
The study uses the same methodology of the American Customer Satisfaction Index and is based on a sample of 10,000 adults.
ForeSee, based in Ann Arbor, Mich., also asked participants to name their preferred method of communication with a retailer, and these are the results:
- 5% preferred mobile.
- 8% preferred social media.
- 11% preferred television.
- 21% preferred websites
- 25% preferred regular mail.
- 64% preferred emails.
"Every retailer should know how many customers are influenced by promotional emails, advertising on Facebook or word-of-mouth recommendations, and furthermore, they should know which group is most likely to buy," Larry Freed, President/CEO of ForeSee Results, says in the report.
"Serious thought needs to be given to finding out whether social media is worth the investment for their business, and then if the answer is yes, they need to make the most of it by making sure that interactions on social media meet the needs and expectations of customers. Otherwise, the effort is wasted and could even be detrimental to the business."
COMMENTARY: Forsee Result's findings are no surprise to me. This is exactly what many media experts and I have been saying. Social media has been a failure.
In a previous blog post dated February 2, 2011, WebTrends conducted a survey and discovered that Facebook's CPMs are too high and CTRs are abyssmal (one-half of regular display ads). In another blog post dated February 1, 2011, digital agency Razorfish conducted a survey reported that social networks like Facebook and Twitter do not make users feel valued.
These findings are nothing new. In an All Facebook article dated November 17, 2007 titled "Is Facebook Advertising Effective", was very critical of Facebook's high CPMs and low CTRs. It does not appear that must has changed in over three years. This makes you wonder why advertiser's flock to Facebook. The argument I keep hearing is, "where else can you reach an audience of 600 million users". I don't think the size of the audience has much to do with it. I believe that advertiser's understand numbers, and they see that traditional media is far more effective in generating revenues and increasing brand awareness.
To advertiser's, Facebook is more of an afterthought, considered experimental, and many are still skeptical, trying to understand this new media, developing reliable measurement metrics and finding ways to accurately measure ROI's. The fact is, advertiser's are not pouring advertising dollars into social media, traditional media is still king, and the results prove this out.
Courtesy of an article dated February 3, 2011 appearing in MediaPost Publications Marketing Daily
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