Can Social Media Effectively Drive Sales?

Have you ever heard someone say that social media is not a good channel to use for driving sales? Perhaps you’ve said it yourself.

Today I’d like to show you how social media can be extremely effective at driving sales. In the process, I’ll provide some criteria you can use to evaluate and measure the effectiveness of your brand’s online networking activities. I will answer the question – does social media marketing increase sales?

My objective is to provide some clarity around the debate and give you some direction to ensure that your brand’s online networking and content marketing actually contribute significantly to sales.

When people say that social media and sale do not merge, what they are referring to is the fact that social doesn’t convert — as in, make the cash register sing. And, who can argue? For the most part, online networking sites make lousy sales conversion channels. But, while conversion is essential, you have to remember it’s only one small part of the sales process.

You still have four steps to get through before conversion is possible. And, another four steps after if you really want to get your money’s worth from that customer. And, for all those steps, which are every bit as important as conversion, you’ll find that online networking and content programs are as good a solution as any.

So, exactly how does social media increase sales? Because, as we know, social is great at these things. And, what are THEY? Put another way, they are: Awareness, Understanding, Interest, and Trust.

All are essential prerequisites to a first sale and the foundation for brand loyalty after the sale. Plus, they’re nothing new. Traditionally, a brand would invest millions each year trying to achieve these four objectives, mostly through advertising. Today, we have a much easier means to this end, but some marketers seem to have forgotten the value of these four precursors to making a sale.

This matters because a conversion-only mentality will prohibit your brand from competing effectively online and will provide your competitors the opportunity to sideline your brand on social sites.

Yet, you are still going to run into people with this mentality. They’ll argue that your online marketing efforts are a waste of money because “what we really need to be doing now is to be selling more.” That’s when you’ll need to make a compelling case for how online channels do exactly that — even if they are not converting.

Another reason this matters is because the elements in this model are the objectives against which your online activity should be managed, measured, and assessed today.

First, be sure to make the distinction between conversion and the broader sales process. Conversion may be king, but it is impossible without achieving awareness, understanding, interest, and trust first. This model will help you visualize it.

Next, be sure not to treat online vs. traditional tactics as if it were a simple either/or matter. It’s not. You should, of course, be using both in a coordinated fashion. The best results will come when you look across all the available channels, both online and off.

Select those that best meet your strategic marketing objectives and budget. Then, use and coordinate those channels for different points in the sales process.

For instance, I wouldn’t use social sites to blatantly promote or close a sale, any more than I’d use a credit card input form to tell people what I had for lunch.

Use as many channels as you can, but use them strategically. That means understanding what they are best at, how they contribute to your sales cycle, and then defining objectives and tactics for each.

Here’s an example from an established, fast-moving consumer goods brand. This brand had good, but rather flat, sales and tended to get a seasonal bump in January. They ran TV campaigns twice a year, indicated here with the orange stripe. The TV produced very little increase, but they felt it was helping them maintain sales.

We asked for 10% of the TV budget to add a social element as an experiment. With that 10%, we were able to activate a few social sites, create a microsite, do some search and social promotion. We even created a mobile game app, a wiki, and some fun downloads. All these activities were run for three months while the TV spots were running.

But, we had two constraints: First, we were not allowed to use the TV spots to drive traffic to the web. Second, we had to pull the plug on all social activity when the TV campaign ended.

This was the effect on sales:

Three things are significant here. First, we doubled sales from baseline. Second, that boost was sustained for three months after the campaign had ended. Third, the only variable that changed was the addition of social activation to the TV campaign, and so the result was clear.

So, to sum up, the notion that online media don’t contribute to sales assumes that sales occur spontaneously. A marketing activity does not have to convert to be contributing to sales. Any online asset that contributes to driving this cycle is most definitely contributing to sales, even if they are not conversion channels. And, these online assets work best when combined and coordinated with all the traditional offline channels your brand uses. Remember, use it or lose it. If you don’t put this to work within 48 hours, it will self-destruct. Summarizing – the impact of social media on sales is huge.

Good luck. Please also read our other post, in which we reveal basic SEO tips.