According to a recent post by Business Insider, the volume of “social commerce”—products that are sold as a result of ads on social media sites—is rising, and fast.
From 2012 to 2013, the total value of transactions that resulted from social media posts increased 60 percent, to $2.69 billion. Facebook dominated, accounting for more than 30 percent of those sales. Business Insider calculated that a Facebook share of an e-commerce post translates to an average of $3.58 in revenue from sales, whereas a share on Twitter, the second-largest source of social commerce purchases, is worth just $0.85.
For a better grasp on how businesses can leverage this information to boost online sales, we directed a few questions to local digital expert (and 914INC “Best Boss”), Bridget Gibbons, CEO and founder of social media consultancy Gibbons Digital in Bronxville.
How should small business capitalize on the growth of social commerce?
BG: Just a few years ago, simply having a social media presence gave a brand a significant advantage. These days, social media plays a significant role in what and how consumers will buy, so small businesses need to have a comprehensive social commerce strategy that will enable them to stay ahead of the competition. Small businesses can offer e-commerce deals (coupons, discounts, etc.) that can only be accessed through their social media site(s). Another great approach is to place e-commerce links in tweets, Facebook, and other posts with a product image. If budget allows, Facebook ads or promoted posts on Twitter, Instagram, and Pinterest are another great way to expand reach and visibility, which could lead to potential sales.
In what other ways are social networking sites influencing consumer behavior and decisions?
BG: According to a survey conducted by Dimension Research, 90 percent of customers say buying decisions are influenced by online reviews. When people want to check out a business, they often go to review sites (e.g., Yelp and Google+) and check the ratings. Businesses that maintain active Twitter and Facebook pages are more likely to have positive ratings (three or four stars), so it is important that businesses focus on and monitor their reviews. Companies can use reviews to better their business practices, improve customer satisfaction, and help them attract and retain customers.
How do you go about making the most of your social media platforms to grow your business?
BG: Businesses need to make sure that they have a solid strategy before launching a social media presence. Businesses should have a clear understanding of their target market and what separates their products or services from the competition.
With that in hand, the next step is to create compelling social media content that resonates with and provides value to the target customer. The more targeted and relevant the posts are, the more likely customers or potential customers are to engage with (like, comment, or share) the business on their social media channels. And businesses need to engage back (e.g., addressing comments, etc.). Engagement builds trust and credibility with the business. Studies have shown that people who engage with a business online are more likely to purchase a product or service from that business. So engagement has easily become one of the most important aspects of growing a business using social media.
What’s ahead for social commerce?
BG: In July, Facebook announced that it was testing a new feature called the Buy button. It allows customers to purchase items directly from a business on their desktop or mobile device without leaving Facebook. Twitter is also testing a Buy Now button, which would allow customers to buy items directly from a tweet. These innovations will potentially change the social commerce game as it will help businesses drive sales through their Facebook ads and news feed, and Tweets. It looks like a win-win for businesses and these social media platforms.