The Face-to-Face Book: Why Real Relationships Rule in a Digital Marketplace by Keller Ed & Fay Brad

Author:Keller, Ed & Fay, Brad [Keller, Ed]
Language: eng
Format: epub
Publisher: Free Press
Published: 2012-05-22T00:00:00+00:00

Not a Sales Tool

Back in 2009 the computer manufacturer Dell announced that it made $3 million in sales off of one of its Twitter feeds, then about 600,000 followers strong. Anyone waiting for the announcement to herald a new day in social media return on investment is probably still waiting. Few if any major marketers have followed in Dell’s footsteps and described to the marketing community just how social media is ringing registers. Marketers these days are more likely to follow Pepsi’s Singh and tell you that social is not a sales channel. Singh has also declared that the value of Facebook friends or fans is minimal at best. Sally Dickerson of Omnicom’s BrandScience unit, which advises companies on media decisions, goes one step further, declaring the value of a Facebook fan as “zero.”

The first thing for companies to note about social media is that there’s little to no evidence available showing that it drives sales. Quite the contrary, there’s a growing body of evidence showing that it doesn’t. One of the most compelling examples we’ve seen on this was a study of online holiday shoppers from Forrester, the technology research group, and GSI Commerce, a provider of e-commerce and interactive marketing services for the world’s premier brands and retailers. Those firms looked at purchase data from fifteen GSI clients during the 2010 holiday season. They found that about eight in ten purchases came after some interaction with digital marketing, but only a small portion of that had anything to do with social media. Traditional digital tactics like search and email marketing were most crucial, followed by affiliate marketing and display ads. Social networks were the least important.

The report concluded, “The truth is that social tactics were largely ineffective in driving sales.” In a conversation with the social media news blog Mashable, GSI executive Fiona Dias put it in even blunter terms: “It’s been a mystery to me why the media is excited about social media. From a retail and commerce perspective, it seems to have no effect.”

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