Satisfied Customers Promote Brands on Facebook More Than Any Other Social Network

In Q1, eMarketer predicted that global B2C eCommerce sales will reach $1.5 trillion by the end of 2014 (a 20.1% increase over last year) due in part to the growth of Internet availability and a mobile use base in emerging markets. In response, many major brands are extending their reach internationally. This year, Asia Pacific (APAC)consumers are expected to spend the most on eCommerce purchases, surpassing North America for the first time ever.

"Social is an important part of any marketer’s mix. A big portion of our new subscribers comes from a “refer a friend,” and we’re going to continue using our customers’ networks to grow our business." - Barry Judge, CMO of LivingSocial

Last month, eMarketer released its 17-page Social eCommerce Roundup, exploring the impact that social media has in driving sales and brand awareness for retailers online. With over half (54%) of all US residents estimated to use social networking sites at least monthly this year, and the vast majority logging in to  Facebook, the social media giant remains top of mind for eCommerce companies looking to boost their advertising reach.

Here are some highlights from eMarketer's roundup of trends and stats, as well as bonus material from comScore's Pulse of the Online Shopper study:

Facebook still reigns supreme amongst media buyers and users alike

As you can see from the chart above, US digital buyers strongly favor promoting brands and products that they are satisfied with on Facebook over any other social media site, far surpassing second-place Twitter by 52%. The good news for those investing in newsfeed, promoted page posts and right hand side ads? One in five respondents reported that they have used Facebook to make a purchase decision.

These stats should be particularly of interest for brands targeting millennials, as this younger demographic is heavily influenced by peer recommendations and opinions. Keep in mind, the appeal of Facebook's ads is also social context; if a shopper "likes" a brand's page, connected friends and family will see this "like" when viewing the brand's ads on desktop and mobile.

Paid advertising is not the only way that brands are engaging consumers. Including social media sharing buttons and soliciting consumer reviews on website landing pages are easy ways eCommerce companies can build more of a relationship with online shoppers and build trust, turning media channels into not just a marketplace but a research tool for other consumers. Referral programs, loyalty bonuses and free sample incentives are also popular methods.

Business Insider came out with a staggering figure in August: $4 trillion in items will be abandoned in shopping carts this year. Here's one potential reason why: as purchasing incentives go, it turns out free shipping heavily influences consumer decisions. Of comScore's consumer study respondents, 58% revealed that they have spent more on an order just to get free shipping, and 30% admitted they have delayed making a purchase until free shipping was offered.

Another reason could simply be that mobile purchasing technology has not been able to keep up with the explosive growth of mobile use. Online shoppers still cite desktop computers as their go-to resource for research, and 41% of respondents prefer a retailer's website over its mobile counterpart (34) or app (25%).

With the back to school season once again around the corner, and the holidays not far behind, eCommerce companies are in prime position to see their strongest two quarters of the year, provided they pay attention to consumer behavior across all digital channels and adapt accordingly. Meanwhile, as devices, targeting methods and ad types continue to evolve, Facebook advertising remains a steady bet.

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The Increasing Facebook Conundrum

To Facebook or not to Facebook, that is the question.

It's a serious question that any business, marketer etc needs to consider - is Facebook worth our time? Facebook used to be a place where with the right approach, brands etc could make a decent impact without parting with any actual cash. A reasonable amount of people would see your update in their newsfeed - it was nice. Whether that actually achieved anything for the business is another question, and frankly one that the vast majority would struggle to answer, but you at least knew that people would be given the opportunity to see your post.

I've got 9% problems...

Rumours started to circulate last year about average organic reach falling to an average of 9% (organic reach is the percentage of your total fans that have your update served to their newsfeed). You could class that as a kick in the teeth. Why did this happened? Well, Facebook will tell you they're trying to improve the quality of your newsfeed, while others will speculate it's all about the benjamins - they want you to pay to 'boost your posts' in order to increase that reach. Zuck needs more flip-flops.

9% was a blessing

How does 1.5% sound to you? Pretty bad right? Well, in March, Page owners started reporting average reaches of 1.5-2%. We then had the much-publicised Eat24 withdrawal from Facebook, which really brought the issue to the attention of marketers. Since then, there's been a constant debate questioning the sense in even being present on Facebook without having some budget to pile into post boosting and further advertising.

The end is nigh...

Or is it? Well, Clarion Comms carried out some interesting research in April. They tracked three Pages over three months to see if the reported drop was a reality, granted, three Pages isn't exactly an all-encompassing study, but at least it gives us something to consider.  Here are the results...

What does this show? Well, two of the brands (it would be nice to at least know what realm these brands are in) are surpassing the 2% by a large margin, while 'brand 2' is sitting in between that 2-9% scale. Note that brands 1 & 2 have spent money on advertising, but not promoted posts. I'd wager that their higher reach is a natural product of the fact that their ads are taking their Page to a wider audience, which really should cause an increase in organic actions, which makes me think that's isn't a particularly valid metric. A handy bit of data, but far from conclusive.

What about my experience?

At Velocity, we manage a number of Facebook Pages. One of the Pages we were handling (a short-term project) was for a very popular brand in the B2C realm, the updates on the Page used to have a great organic reach (an average of 48% and strong 'engagement'). The project ended in March this year and I worked out the average reach of the last ten posts we published on their behalf. The average organic reach amounted to 0.3%. Ouch. We hadn't changed tact as things had been working very well, this drop was very, very sudden, almost overnight. That 0.3% renders organic activity as useless in this case.

So, is it time to abandon Facebook?

The data is inconclusive. If you look at this chart (via Adage), you'll see that while reach is down, engagement is up...

Again, this data isn't exactly comprehensive in terms of the number of Pages assessed, but it does give some hope that while brands perhaps aren't reaching as many people, they are creating more 'engagement'.

Ok Mike, what should we do?

First things first, make sure you are as aware as physically possible as to what your Facebook activity is achieving for your business, client etc. If you don't have a clear picture of that, you can't even begin to consider the sanity of my next piece of advice for you. De-prioritise Facebook Does that sound crazy? It isn't. If you used to have actual success via Facebook on an organic level, and that's no longer the case, then you have to consider its importance in your marketing mix. That sounds rather obvious, but often businesses (and their suppliers) will plough on regardless, which is just plain silly. It may be the case that you've placed a lot of emphasis on Facebook and Twitter as part of your social media activity and that's fine, but can you make better use of your time by dropping Facebook down your pecking-order? Perhaps you can reach similar audiences in one of the other plethora of other social media options out there? Don't want to remove Facebook from its pedestal? Then, you need to ask yourself...

Can you up your game?

To increase organic reach, you need to be putting out content on your Facebook that people want to get involved with. Is your content good enough? Can it be improved? Monitor, and I mean really monitor the effect of each update - what is creating the biggest reach and engagement? Are you linking back to your site or content within it? What updates are causing the best traffic and what are those people doing when the arrive on your site? Up your game and focus on the wins.

Can you shell out?

If you have budget available to put towards post boosting and wider Facebook advertising, then you can still achieve solid results with a blend of paid and (quality) organic activity. However, and you'll be sick of hearing this from me, please don't throw money at it without knowing what it is achieving. We are now advising startups or businesses making their first moves into social that to achieve real impact with Facebook, they have to be willing to spend some money. If they can't do that, then a realistic outlook of likely Facebook success is required. It may be the case that maintaining simple presence (and monitoring it) is the best approach, without putting blood, sweat and tears into it.

Concluding thought

All is not lost when it comes to Facebook, but people need to be more clear than ever on what they're trying to achieve with it and be realistic about success and likely growth. Don't be scared about not being on Facebook, its not a prerequisite.

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