Social Media Outreach: A ‘Waste of Time and Money’?



Cory Bennett
05/25/2011

Fiona Dias, executive vice president of strategy and marketing for GSI Commerce, has for awhile been telling clients that social media outreach is not worth their energy or time. Recent research conducted collaterally by Forrester Research and GSI Commerce, backs her assertion. The study showed that social media’s influence on online purchasing behavior is negligible.

"It’s been a mystery to me why the media is excited about social media," Dias told Mashable. "From a retail and commerce perspective, it seems to have no effect."

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The study, based on data compiled from online retailers during the holiday shopping season – November 12 through December 20 – showed that less than two percent of orders originated from a social media network.

"Buying things from retailers is maybe 10th on the list of things they want to do on Facebook," Dias said.

Email marketing and search advertising – like Google Ads – were the most effective methods for driving direct purchases. Over three quarters of transactions followed some engagement with these interactive marketing tactics prior to purchase. Nearly half of web buyers had multiple exposures to web marketing efforts prior to the purchase decision – downplaying the significance frequently placed on the "last-click" metric to determining a marketing campaign’s success.

Todd Wasserman, who wrote the Mashable article and is the publication’s business and marketing editor, expressed reservations about the study when contacted. He noted that while Dias’ marketing background is robust – she was the CMO at Circuit City – she is "clearly going against the tide."

"The study … put a lot of emphasis on where [buyers] had just come from," he said. "It’s looking at one part of the whole equation."

Indeed, the study mostly focused on the direct "clickstream", or series of actions, a purchaser made directly leading to a purchase. The "whole equation," in Wasserman’s opinion, includes any type of ad or information seen over a long period of time.

"I think they underestimated that aspect of the purchasing decision," he said, adding that his based his belief on watching companies design media and marketing campaigns. "It’s not just the last website you click on. Often, there’s a lot going back three weeks or so to something you saw."

The research did try to capture some of the prior touchpoints by analyzing retailers’ answers to the question, "How did you learn about Cyber Monday deals?" – referring to the online deal-laden Monday after Thanksgiving. Those responses did reveal a higher percentage of social media engagement with the company prior to the actual clickstream leading to the sale.

Still, only seven percent learned about the deal through a retailer’s social network efforts and four percent found out through a friend’s social network updates. The study summarizes, "Hope for the best, bust expect the worst with social."

The study did note, however, that purchasers are more likely to utilize social media on days and time periods known for deals – Black Friday, Cyber Monday were the two that fell in the study’s window. 23 percent of consumers who shopped online during Cyber Monday later shared a found deal on their social networks.

"Social networks continue to be inexpensive ways to promote messages and are therefore relatively low-risk and for that reason along should not be ignored," it concluded.

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