U.S Sales Figures Demonstrate That Social Media Advertising Won’t Necessarily Get The Cash Tills Ringing.

The U.S. has just experienced its busiest shopping weekend of the year so far.

The weekend running from Thanksgiving through to Cyber Monday is generally a business success, and delivered once more in spite of the gloomy nature of the economy. Most business with a national reach invested heavily in social media marketing to promote the event, yet sales figures would tend to indicate that much of the sales success had little to do with the social media. In fact IBM maintains that online traffic only accounted for about 1% of the total sales. So are businesses wise to invest so heavily in a social media campaign if the platforms aren’t generating sales?

So what is the evidence for IBM’s contention that Twitter mentions and Facebook likes have little impact on sales?

Well, according to IBM Commerce, which tracked the sales of 500 of the top U.S. retail sites, only 1% of sales on Black Friday were generated online, and that figure is lower than the previous year. For clarification, IBM is referring to those customers who were referred to a retailer’s site through social media and made a purchase. The decline comes in spite of the fact that many of the companies reported record sales. Offerpop, a marketing company that helps retailers like Sears, Walmart and Amazon run their social media campaigns, also claims that its clients pumped in an extra 40% increase into this year’s Black Friday shopping weekend social media campaigns.

So is advertising online through social media platforms really a waste of time and resources?

Well, not according to Jay Henderson, strategy director for IBM Smarter Commerce. Speaking to Business Insider.com, Mr Henderson claimed that social media advertising is a price worth paying as it increases brand awareness, and at the end of the day that its real purpose, not increasing sales directly. Target, for instance, one of the 500 companies that IBM tracked, rewarded a number of its customers tweeting about the company with electronic gift cards, according to company spokesman, Joe Curry. Target also used an interactive Facebook app to reveal its Black Friday deals by pitting a number of products against each other and asking users to pick the product they thought most-suitable for the Black Friday sales. If you’re looking for evidence of brand awareness, then how’s this for a fact? The game had almost 1 million users over the four-day period.

Many of the companies received extra mentions on social media channels during the sales period, with Twitter mentions for retailers in particular jumping significantly. Mentions of (AT)DisneyStore increased 42%, according to the company, and tweets with the hashtag  #FairyGodmother, which customers included when they had a question or needed help with a product, were up 40% from the previous year.

It’s one thing to talk up the benefits of social media advertising in creating brand awareness, but how do you go about measuring its value and return on investment? Well, through careful tracking and analysis of social media sentiment, according to Erin Robbins, head of business intelligence at data analytics company, Viralheat:

“Most of the retailers we’ve worked with have all agreed that people talking about their particular store or brand is always going to be better than not. Moreover social media in some way, shape or form is oftentimes one of the first ways someone will hear about something. It contributes to not just awareness but actual product decisions.”

This sentiment is backed up by Mark Cooper, chief marketing officer at Offerpop. Speaking to BusinessInsider.com he argued that “mostly people are using social to discover products and to discover deals.”

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