A new study confirms that consumers are increasingly connecting with their favorite online retailers through social media sites, particularly Facebook. But most of those "friending" or "following" online retailers are already loyal customers.
The study of nearly 10,000 visitors to the biggest
e-retail websites in the U.S. by ForeSee Results found that 69 percent of online
shoppers use social media sites. Of those active with social media, 56 percent
choose to proactively interact with companies on social sites by "friending"
or "following" at least one retailer. Broken down further, 61 percent of online
shoppers who interact with companies on social media sites "friend" or "follow"
fewer than five companies and nearly one-fifth of social media users interact
with 11 or more retailers on social sites.
Of those who "friend" or "follow" companies, 49 percent use it to learn about special deals and options, 45 percent to learn about products, and only five percent for customer support.
Not surprisingly, Facebook ranked as the dominant social media medium. Of those that used social websites regularly, 81 percent said they use Facebook; 31 percent, YouTube; 22 percent, MySpace; and 16 percent, Twitter.
But in an "an unofficial look" at the Facebook pages of the Top 100 online retailers (based on sales volume), the study concluded that one-quarter do not have any formal Facebook presence and another quarter have fewer than 10,000 fans.
In the report, Kevin Ertell, vice president of retail strategy, ForeSee Results, wrote that the highest levels of satisfaction with retailers' own sites were found among shoppers who interacted on the largest numbers of social media sites. Site visitors who also interact with a company on a social media site are more satisfied, more committed to the brand, and more likely to make future purchases from that company. But Mr. Ertell noted this presents a challenge since these social sites are predominantly reaching loyal customers.
"This is a bit of a chicken-and-egg phenomenon," said Mr. Ertell. "It is likely that the customers who are more satisfied and loyal to begin with are the ones who will friend us on Facebook or subscribe to our YouTube channels. However, research shows that when retailers provide rewarding social media experiences, our customers become even more satisfied and loyal."
Discussion Questions: Should social media tools such as Facebook be predominantly seen as a way to reinforce loyalty with existing customers? What's the opportunity around social media in reaching new customers?