Has social media failed e-commerce?

Following the launch of Twitter’s “Buy” button earlier this week, Peter Cassidy, co-founder of Stackla, examines how social media drives potential consumers to retail websites.

The success and rapid adoption of social media made it inevitable that businesses would look to social to drive online sales.

New social platforms came with the promise of unprecedented reach, providing retailers with the means to drive swarms of qualified prospects to their websites.

The truth of course, is that social media didn’t deliver on the promise.

US data company Monetate analysed over 500 million eCommerce sessions and found that only 1.55% of all eCommerce traffic came from social and only 0.71% of that traffic resulted in sales.

People simply don’t hop from their Twitter timeline to your shopping cart.

Don’t shoot the ‘messenger’

The results brands have typically seen are less a symptom of social media’s failings and more a matter of approach.

It’s not new knowledge that buyers regularly seek reviews about products prior to purchase from other customers; few would argue that product mentions by satisfied customers hold more weight than any brand-generated review or advertisement.

A Nielsen study shows that 77% of shoppers say ‘social exposure’ to a product is the most persuasive source of information.

Own your earned media

What are brands doing with the brand mentions and authentic endorsements their customers are posting on social networks? In most cases these ‘money can’t buy’ social validations are lost in the social ether, victims of the brief ‘post halflife’.

Herein lies the problem: brands are not harnessing the power of social recommendations.

If you consider that social media has increased the number of product endorsements available to a brand – be it a post on Facebook, Twitter, Instagram or Pinterest – we start to see social media’s true potential for eCommerce.

Where social media excels is in converting customers at the point of sale. We need to stop thinking about social media as a source of website traffic and rather as a powerful conversion factor at the point of sale.

Social validation has to happen at the point of sale

When someone is shopping at home, alone, perhaps on their iPad on the couch – that is when the authenticity of social content is most powerful.

Fashion retailer Wanted Shoes is an example of how integrating social content at the point of sale can work seamlessly.

Wanted Shoes created a ‘Social Scene page’ that provides users with a whole new way of browsing their products. In effect, it’s like their own Pinterest board where all the content is sourced from photos their customers post on social media while wearing their products. Users can browse the content, find a picture they like and click through to buy the product featured in the picture.

Customers identify with the real people in the photos and that social validation provides the confidence they need to complete a purchase.

Over a period of three months, Wanted Shoes compared conversion rates for customers who shopped via the Social Scene page against those who shopped via the regular cart. What they found was significantly higher conversion rates via the social catalogue.

The Social Scene page was also the ‘stickiest’ page on the website, with the longest dwell times (almost 2 minutes), and a bounce rate of just 5% making it the most engaging page on the website: 95% of customers were clicking from this page to a product that appealed to them.

Retailers are starting to see the light. Brands harnessing social commerce to great effect include Myer with its Spring Summer Fashion Launch, Michael Hill, SABA and Loving Tan.

User Generated Content is better than Brand Generated Content

Brands are producing expensive content for social media that simply doesn’t get seen by their target audience, so why not harness what is already being created by your brand advocates?

With the advent of smartphones featuring superb photography capabilities combined with surging mobile Internet usage – 7.5 million Australians used the internet via their mobile phone in 2013, an increase of 33 per cent compared to June 2012, according to ACMA – the customer voice has never been stronger.

The challenge for brands is to aggregate content from across disparate social networks and bring it to where it has the greatest impact – at the point of sale.

Only when this is done can social media truly deliver on the promise to drive sales.

 

This article was  featured on mumbrella.com.au