Should Social Media Really Be A Top Priority?
The level of buzz about all things “social” in marketing today is becoming deafening and frankly I’m worried that in some organizations it will drown out the voice of reason when it comes to setting marketing priorities. I recently took some decibel readings on social media buzz during the eTail West conference in Palm Desert. This is a great annual event that brings together executives from every kind of retail business to discuss online retailing. The hottest topic this year was definitely social media’s potential to increase retail performance. How do I know? Through social media itself.
I did not attend eTail West in person this year, but from my desk a thousand miles north of Palm Desert I tracked the Twitter stream for hashtag “#etail” during the week of the conference. Social media was definitely the hottest topic. A close second was “mobile,” as in: “What can mobile devices do for my retail business?”
What was not top of mind among the event’s tweeters was search or conversion; which is a pity, because both of these remain, in my opinion, far more fundamental to commercial success in the digital world than social and mobile. I think this is true whether you are a multichannel retailer, a web-only etailer, or an insurance company with a website from which you hope to gather leads and land new customers.
Of course, you might expect people who tweet to be jazzed about social, so I checked in with folks on the ground at the event and they confirmed my Twitter-based impression that social media was getting a lot of attention. To some extent that is understandable. Social is exciting, new, and clearly rich in possibilities. The bad news is that too many companies, both in retailing and beyond, are going to devote time and resources to social media initiatives before they have their search and conversion strategies in order. The big risk here is that a lot of money spent to generate social buzz and bring traffic to the website will be wasted because the website is not optimized for conversion.
Unless a website is properly tested and tuned to make the most of the traffic you drive to it, bounce rates will be higher than they should be and conversion rates will be lower than they could be. And the sad thing is, many companies may not even notice. If a company pursues social media initiatives while measuring success purely in terms of traffic numbers—usually the easiest metric to get–there may be much rejoicing as waves of new visitors hit the site. There may even be some spikes in revenue, or leads, or other metric that the company uses to measure marketing ROI. But unless you’re also watching bounce rates and conversion rates and retention rates and revenue per session, the point of “going social” may be missed, along with a lot of dollars.
I admit that I spend a lot of personal time on social networks for fun, but I would never encourage a company to spend even a dime on a social network initiative unless there was a plausible ROI model to justify that decision, plus a system in place to measure the actual ROI in practice. As I see it, the buzz about social, and to a certain extent the frenzy over mobile, reflects three fundamental problems in eCommerce:
1. Most companies find it easier to measure traffic than conversion rates.
That can lead to a false sense of success from social media campaigns. Be wary of statements like: “We know we got a lot of fresh traffic and we think it resulted in more revenue.” When it comes to results, digital marketing is about knowing, not thinking; it’s about making data-driven decisions. You can’t rely on “we think it paid off.” You need real numbers, like actual lift in conversion rate, revenue per session, and average order value. And if you’re running an online store, what was the actual effect on customer acquisition and cart abandonment rates?
2. Most companies find testing and optimizing website content harder than buying traffic.
For most companies the website is the place where conversion occurs and if you are going to use social media to drive traffic to your website you need to make it feel welcome. In other words you need to serve up content that is targeted to that traffic. Unfortunately, good tools for doing this have, until recently, been hard to find. That meant content changes had to go through IT and we all know how many other pressing things IT has on its plate besides catering to Marketing.
3. Most of us find edgy new things more exciting than the fundamentals.
This is just human nature but there are times when we have to resist our impulses and use reality to drive our decision-making. I’m not saying social media marketing is not worthy of investment, I’m just saying you need to keep it in perspective. That perspective needs to include the fundamentals, like a systematic approach to testing and targeting of content. Get the fundamentals right and you will be ready to produce some truly awesome social media magic.