Paul Holmes 05 Jan 2011 // 12:36PM GMT
Here’s an interesting survey, and an odd interpretation of the results. Market research consultancy ForeSee conducted a survey of online shoppers and asked how many of them had been influenced to visit an e-commerce website by social media. The answer was about 4 percent—a statistic USA Today and many other media interpreted as underwhelming: “The power of social media to influence purchase decisions may be overstated.” Really? Consider, first of all, that many companies—including many online retailers—are still not fully engaged in social media. I suspect that many companies using these channels in a sophisticated and strategic way find that a significantly higher percentage of their business is influenced by social media. And secondly, consider that social media is not like direct mail: it’s not all about driving purchases, or even website traffic; it’s about engaging with consumers, building a long-term relationship. Under the circumstances, I think a new medium that contributes to about 4 percent of sales (while consuming far less than 4 percent of the marketing budget at most companies) is pretty impressive. I’d be astonished if mainstream advertising, which still accounts for 90 percent of the marketing spend at many companies, can boast a better return on investment.