We’ve all had discussions about the benefits of social media marketing; what it can do for brand awareness, for word of mouth and brand perception, and for driving traffic to websites via direct routes, referrals and through search engines. But here’s a question for you: what CAN’T social communications do?
What prompts this post is an ongoing debate I’ve been having with a new client about, you guessed it, the value/ROI of social media. To put this into context, BOTTLE is carrying out a full PR programme for this particular client, which is an online retailer on a very tight budget. Social communications forms part of this campaign, but I’m coming under heavy scrutiny for how the social media element of the programme is performing…despite it being only three months old.
- The Facebook page is growing at an average of 4.1% per month. Econsultancy states that “good growth for a Facebook page is typically 3-5% on a monthly basis”. Of the top UK brands on Facebook, Skittles (UK) has grown 3.2% in the last month, Creme Egg by 4.4% and Starbucks (UK) by 2.5%.
- The average engagement rate for the page is 0.5% per post. Econsultancy states that “a good average engagement rate is above 0.1%, a great engagement rate is above 0.3-0.5%”.
In a direct comparison for Q1 for the last three years:
- Website visits have increased by 12.0% year-on-year in Q1 2011 from Q1 2010. The increase from 2009 to 2010 was just 2.2% year-on-year.
- Referral traffic has increased by 196.3% year-on-year in Q1 2011 from Q1 2010. Referral traffic FELL by 7.0% year-on-year between 2009 and 2010.
- Direct traffic has increased by 36.6% year-on-year in Q1 2011 from Q1 2010. Direct traffic FELL by 27.5% year-on-year between 2009 and 2010.
- Organic search traffic has increased by 30.6% year-on-year in Q1 2011 from Q1 2010. The increase from 2009 to 2010 was only 11.8% year-on-year.
Now maybe I’m biased, but if those statistics don’t prove how influential PR and social media marketing can be, I don’t know what does. Overall website visits and traffic from search engines up significantly on the same period last year; a significant decline in direct traffic not only arrested but now showing healthy growth; and perhaps most telling of all, falling referral traffic now nearly three times that of last year. And yet…the client isn’t particularly happy.
And that leads to a question that I’d love your thoughts and opinions on with regard to whether or not you feel that social media can have an impact. The client is heavily focused on conversion rates which, by all accounts are fairly static. The argument goes something like: “yes we’ve got all this extra traffic, but the percentage of people buying hasn’t increased”. Now there are three main ways to increase revenue from an e-commerce website: you can get more of your existing visitors to buy (increase the conversion rate), you can increase the volume of traffic to your site, or you can increase the average transaction value (get people to buy more). So conversions are important. But how much can a PR firm do? Where is the line drawn?
In the long term, I feel that social media marketing can and absolutely should influence conversion rates by enhancing brand perception and brand affinity. But my questions to you are, talking generically: how much of the conversion factor is down to brand perception, and how much is down to the seller’s ability to ‘close the deal’, whether in person or on a website? In the short term, how much can PR and/or social communications influence a customer’s willingness to purchase? And is it reasonable that our clients measure us by this metric?
I’d dearly love to hear your thoughts in the comments below…
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