Social Media is one of the biggest marketing channels for businesses of all sizes. According to a study by The CMO Survey, social media spending has witnessed a 234% increase over a seven-year period, rising from 3.5% of marketing budgets in 2009 to 11.7% in 2016. But the real question is, what is the value of a "like?"
I recently read an article in the Harvard Business Review that shook my beliefs around social media. Marketers, myself included, believe that if a user engages with you on Facebook or another social media platform, they end up spending more money on your business. But according to this new study, this logic is flawed because we are confusing "cause and consequence." Check out the video below to learn more.
Over the last few years, social media has exploded. It's become an amazing channel to connect with friends and families, but also to help grow our businesses. It helps us stay in touch with the people that we do business with the most in a more personal and more social, authentic way. But is it driving the results that we think it is? A lot of times you hear marketers say that a “like” is relative to more purchases. So, if somebody likes your page, they're going to spend more money at your business, and we could try to figure out the correlation between the two. But is this actually true? That's the question that we're going to try to find the answer to today.
I've said before, brands spend billions of dollars every year growing their social media campaigns, growing their social following and really trying to build a presence online in hopes that this will have a return in positive sales numbers. That this will help drive up more sales and grow their business online. But is this an accurate assumption for us to make? In a recent story done by Harvard Business Review, we find that there may actually be some flaws in this way of thinking. In fact, the problem, they say, is that marketers confuse cause with consequence. It's possible that getting people to follow your brand on social media makes them buy more, but it's also possible that those who already have a positive feeling toward your brand are more likely to follow you in the first place, and that's why they buy more.
So, this is a really interesting point. A lot of the time we assume that people “like” us, and then after they “like” us, they buy more from our businesses. But it's also very, very possible that people like us because they're already doing business with us, and they're already spending money with us and “liking” our brand and connecting with our brand on social media, it's just one more step in the engagement process. So, it may not be the entry process, but it may be actually further along in the funnel than we think it is. As in terms of actually building connection and relationship, rather than acquisition.
This is a really interesting concept because we drive a lot of intention, and honestly, this is something that I've been doing. Using social media as an attraction model, which is a great model to do that. You can attract people, but it may be more important for us to start to think about social media as a connection part of the journey, where we're actually building a relationship with people who already are doing business with us. There are studies that show that there's no correlation between “likes” and sales. If somebody “likes” your page, and if somebody doesn't “like” your page, they can really have the same sales volume. It's a really interesting study, and I'm going to link to the article below. What it basically proves is, “liking” a page, doesn't necessarily correlate with increased sales. So, how do we drive sales through social media and engage people? That's the next thing we're going to answer.
So, in this case, we're going to talk about Facebook. As we know, Facebook has changed their algorithm a lot and made a lot of different changes in how people see certain things. So, just because your business is posting something, doesn't mean your entire audience is actually going to see that post. There's a number of different factors that are coming together and deciding whether or not somebody is going to see that post. So, you could be posting a ton of stuff organically that's really getting low visability.
So, how do we change that? Well, simple, we use ads. Facebook ads are a really great way to make sure that our audience is actually seeing what we're using. There is a direct correlation between ads and creatives inside of Facebook and sales. It's also easier to track because you have an end goal in mind, and you can step through the process. Did this ad accomplish the goal that we set? A lot of times with an organic post, we're just trying to get reach and grow brand visability. But when it comes to ads, we have a targeted purpose, and this is where measuring and understanding analytics comes in.
A lot of times we just throw stuff out there (on social media), and we hope that it's going to work. But that's not a good approach. In fact, 83% of CMOs don't know how to measure ROI on social media. But we can do that if we take a proactive cross-step backward and we start to understand what we're trying to achieve. When we build a creative in an ad, we need to have a goal in mind. We need to understand what we're trying to do. Is it sales? Are we trying to grow brand visability? Are we trying to grow interactions? From there, we can start to map out whether or not we've hit our goals. So, when you use ads, you're actually going to be able to reach a lot more of your audience because it's going to be targeting them based on the framework that you set up in the ad process. This is where Facebook can really benefit you, and you can start to see what's working and what's not working.
So, the long-held belief that a “like” increases the number of sales is actually not true. But what we can do is use those “likes”, and use that audience and use them as a targeted group to advertise to, to build a specific campaign around and share with them product information, sales information, new things that we have going out to help them increase the likelihood that they're going to spend money on our business.
Hope you guys found this interesting. Please stay tuned for more videos in the upcoming weeks and subscribe to our channel. Thanks so much, and until next time, happy marketing.
Here is the article mentioned in the video: https://hbr.org/2017/03/whats-the-value-of-a-like
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