Social media not leading to sales, new research reveals

Social media may be one of the best communications tools a business can have, but according to some new research it just doesn’t hold up when it comes to making money.

The new figures from Forrester track 77,000 purchases to figure out exactly what made customers buy, but only 1% of those sales came from sites like Facebook. The main culprits were the old faithfuls, email marketing and search marketing.

With so many small businesses putting effort into maintaining a healthy presence on social media, the research begs the question: Is it worth it?

The most common ways people purchased items were through direct visits at 20%, organic search at 16% and paid search at 11%.

But Catriona Pollard, the managing director of CP Communications, says businesses need to determine how they’re actually measuring the return on investment from social media, or whether it can actually be measured in the first place.

“From a social media perspective, it depends on what your objective is,” she says.

“I think social media is great for brand awareness, and building the trust that eventually leads to a sale. It might not actually mean that people click on the shopping cart, but it will lead to a trusting relationship.”

“There is a link, but it might not be direct.”

The concept of measuring return on investment with social media is problematic. Plenty of questions have already been raised as to just how lucrative advertising on social platforms like Facebook can be, let alone actually selling goods through social media.

Pollard’s idea that social media should be used as an engagement tool rather than a selling tool has merit. A recent American Express survey found 55% of respondents said the main reason they use social media is to develop relationships with customers, while 50% said they use it to market products and services.

However, there is some hope – the Forrester survey didn’t actually question small businesses, which tend to do a little better when it comes to selling through social platforms.

But Pollard says taking the long-term approach can yield ongoing and consistent results, rather than a direct link between social platforms and the shopping cart.

“Social media is focused on thought leadership and positioning the brand, and that’s where it plays an important role.”

“Consumers may not be clicking through, but I would absolutely suggest that it’s leading to sales.”