Social Media Affects Purchase Decisions, ARF Finds

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Social media has a measurable impact on consumer purchase decisions, according to a new study from the Advertising Research Foundation based on a survey of 2,000 U.S. shoppers. The study was commissioned by the ARF, conducted by Communispace, comScore, Converseon, and Firefly Millward Brown, and sponsored by General Motors, Google, Kraft, Motorola, and Young & Rubicam. Technical guidance was provided by Duke University’s Fuqua School of Business.

The study, titled “Digital & Social Media in the Purchase Decision Process,” found that roughly one-third of shoppers said they were either introduced to a brand or product, or changed their opinion about a brand or product during the buying process, because of social media. What’s more, 22% of shoppers surveyed by the ARF said that social media was “important in my final purchase decision.”

By the same token, the ARF study emphasizes that many consumers may not be fully aware of the factors influencing their purchase decisions, as “some ‘shopping’ behaviors are taking place outside of consumer consciousness, as digital and social media have infiltrated consumers’ lives…”

On this note ARF executive vice-president for primary research Todd Powers stated:  “This state of constant interaction with brands through digital and social media has come to challenge the purchase funnel, as we have traditionally understood it. This also challenges the notion that consumers are aware of the influences on their purchase decisions, and that they always make decisions consciously.”

While ARF studies are something of a gold standard for advertising research, there are some other recent studies suggesting a link between social media and purchasing behavior. Earlier this week I wrote about a study by researchers from the University at Buffalo School of Management, Aalto University and Texas A&M University, who were able to correlate social media engagement with increased purchases for a large specialty firm in the northeast U.S.

According to co-author Ram Bezawada, assistant professor of marketing in the School of Management at the University at Buffalo, “Our results show that when customers engage with a business through social media they contribute about 5.6 percent more to the firm’s bottom line than customers who do not.”

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5 comments on "Social Media Affects Purchase Decisions, ARF Finds".

1. Andre Szykier from maps capital management
   

   commented on: January 23, 2013 at 4:30 p.m.
   This article is just a bunch of crap to promote social media as a venue for buying. Other studies in the last 90 days showed that social media only contributed 0.34 % (less than a third of one percent) to online ecommerce. Enough said.
2. Jenifer Kramer from Jenerosity Marketing
   

   commented on: January 23, 2013 at 10:09 p.m.
   I don't think they are saying that brands have to engage in ecommerce. I think they are saying that consumers are now interacting and being exposed to brands in many new and different ways than in the past. Historically, a consumer would have very few resources they could check in evaluating a brand to purchase (say Consumer Reports Magazine). Now, consumers can check with friends and contacts on Facebook, search Twitter, look on YouTube for reviews, etc. and these platforms are actually impacting the consumer's purchase decision. The purchase funnel used to be much more linear whereas now, consumers are interacting with brands (and friends about brands) at all stages of the purchasing process.
3. Bruce Mcarthur from VMG Media
   

   commented on: January 25, 2013 at 6:54 a.m.
   @Andre - I reread the article after seeing your comment, I thought I'd missed something. Three observations: 1. This research is not suggesting social media is a venue for buying. It IS pointing out that social media is now involved in a consumers decision making process. Big difference. 2. I believe your 0.34% is referring to a direct click-through from a social media network to a purchase. As far as direct ecommerce goes, that number looks about right to me. 3. 0.34% is GREATER than one third of one percent. :)
4. Ryan Bifulco from Travel Spike
   

   commented on: January 25, 2013 at 12:34 p.m.
   Erik, great article as I'm always excited to see more research supporting Social Media since there are so many people who still doubt it. I have a few case studies and stats that further support your piece if you want to review: http://www.mediapost.com/publications/article/186208/social-media-generates-bookings-and-roi.html#axzz2J0fQVf2N
5. Tom Cunniff from Tom Cunniff
   

   commented on: January 25, 2013 at 4:14 p.m.
   I applaud the ARF for doing this research, even if the results are unsurprising. Of course humans are somewhat influenced by what they see online. Recency alone would play a role. With that said, marketers would do well to remember that the role of social is not equally applicable to all categories. The dynamics of travel decision-making, obviously, are quite different than for toothpaste. Very many things affect purchase decisions, to different degrees. Social can help sell, but it is not a silver bullet. It's just one more tool in the toolbox.

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