Commentary
12% of Americans Cite Social Media in Purchases
- by Erik Sass , Staff Writer @eriksass1, June 16, 2011
The social media ROI discussion is heating up with a spate of new research drawing connections between social media, brand perceptions, and purchase behavior. That includes a new study released earlier this week by Knowledge Networks and MediaPost's very own Center for Media Research, showing that the number of Americans who say their brand consumption choices are influenced by social media has increased substantially in the last year.
According to the second wave of the KN-CMR study, titled "The Faces of Social Media," 38 million U.S. adults ages 18-80 (or 12% of the total population) say they discover new products and brands or refer to social media before making purchase decisions. That's up 14% from 33.3 million just six months ago. This includes 23.1 million who say they discover new brands or products through social media, up 22% from 18.9 million in 2010, and 22.5 million who use social media to learn about unfamiliar brands or products, up 9% from 20.6 million last year.
What's more, 17.8 million say social media has "strongly influenced" their purchase decisions, up 19% from 15 million in 2010, and 15.1 million say they make sure to refer to social media before making a purchase decision, up 29% from 11.7 million last year.
As might be expected, the KN-CMR study also shows a big increase in mobile social activity. Among teens and adults who use social media, the subset who have accessed social media via mobile devices soared from 28% to 40% of the total (meaning about 80 million this year). And there is significant overlap with consumer activity: within the mobile-social group, 27% use social media to compare or check prices, 24% refer to social media for reviews, and 16% use social media to find coupons, discounts, or special offers for local businesses.
Coining a hip new term for social media, "SoMe," Patricia Graham, chief strategy officer Knowledge Networks, observed: "Tying consumer interactions back to brands and purchase decisions is essential for marketers, in social media no less than any other platform. While we have seen a dramatic rise in key metrics that quantify SoMe's influence, we also have observed a wide variation of influence at the category level. The Faces of Social Media gives brands the ability to not only understand, but also act on that influence."
"The on-the-go consumer is becoming more mobile in their social media usage," said Chuck Martin, Director of the Center for Media Research at MediaPost Communications. "This move to mobility combined with the increasing influence of social media during the purchase process has great implications for marketers, who will have to look at location as well as which product purchases are most affected."
The complex issue of ROI remains one of the big question marks (and hindrances to growth) hanging over social media. As noted, however, the last couple months have seen a number of promising studies grappling with ROI and measurement generally. For example, Ogilvy and ChatThreads conducted a "Integrated Social Media Sales Impact" study from January-May of this year, tracking brand exposure for 404 individuals through ChatThreads' BrandEncounter platform. In the study, which they presented to the ARF's Audience Measurement conference earlier this week, Ogilvy and ChatThreads looked at purchases by quick service restaurant customers patronizing KFC, McDonalds, Subway, Taco Bell and Wendy's; the customers were sorted by their degree of exposure to social media advertising for the QSR brand in question, as well as their exposure to advertising delivered through other channels. And last month Buddy Media released a study titled "Strategies For Effective Facebook Wall Posts: A Statistical Review," offering some tentative metrics for social media success in that specific venue.
Erik Sass is editor of Publishers Daily. You can reach Erik at eriksass@gmail.com.
ROI will get more closely defined and reported as the integration of all feeds and social spaces carry a more sentiment way of connecting all the conversations and establishing values for them. Companies like Sentiment Metrics is a company that offers a product that has this move towards multi-integrated locations and applications.
I really hate this type of research. It is important. But the headlines really mislead.
So, 12% of people have had some kind of influence on at least one purchase. We have to be very careful NOT to confuse this with "12% of purchases are influenced by social media". Surveys of this type always leave behind the implication of the second even though they don't say it specifically.
And secondly, given 50% penetration of social media in the US, shouldn't we look at the number and be careful. Over 75% if SoMe users aren't being influenced in their purchases. Given the number of years it's been around, that is really kind of a shock.
@Doug - I agree with you on remaining skeptical when looking at research data like this. You can skew numbers any which way but loose (Clint Eastwood anyone?) to get a desired result.
But I also think that looking at big picture trends is important. The data can be inflated and misused and even confused at times, but trends don't usually lie (the key word - usually).
In short, looking at the overall "big picture" tells us that the average consumer is relying more heavily on social media and their mobile devices as resources/tools that ultimately influence and aid in their purchasing decisions. Duh, right?
Nothing misleading by the headline. It reports that "38 million U.S. adults ages 18-80 (or 12% of the total population) say they discover new products and brands or refer to social media before making purchase decisions." It doesn't claim that 12% of "all" buying decisions are influence by social media. These are two separate issues.
Important here is the big picture trend which clearly shows that as the social web develops further, commerce will be impacted by it.
It's also likely that in about a year or so the ROI question will have been answered for good. There are hundreds of examples and case studies available on this topic.
I concur all around. And note that I observed this kind of research is important.
But it's the one that's most abused by agencies in pitches, by clients in justifying poor decisions, and by fund raisers claiming to have found the magic pill.
Back to my last point: I think it's stunning that only 12% of consumers said that at least one purchase was influenced by social media. There is always the flakiness of memory recall in this type of study.
But seriously, social media has been a big thing for years for many. Isn't 12% actually quite low?
Great article! The increasing influence of social media on consumers cannot be disputed. Although the actual percentage of purchase decisions influenced by social media may not be concrete when looking at the US as a whole, new social media monitoring software does enable individual brands to measure the ROI they’re achieving from their social initiatives. While it's true that there is not a "one-size-fits-all" formula for doing so, there are a few key rules of thumb that can be applied to nearly any industry. Here is a white paper which takes a comprehensive look at the challenges involved in measuring ROI of social media, reviews the thought leadership on the topic and provides practical recommendations on how to achieve stronger ROI from your social initiatives: http://bit.ly/mmproi
Socially charmed,
Danielle
Brand Evangelist @MutualMind