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New Research Shows Social Media Marketing has Strong Impact on Retail Sales

Social Media marketing has fought for and won a seat at the marketing table. It’s no longer an add-on or an experimental component of the marketing mix, and many companies are investing a significant chunk of their marketing budget in social media.

Now that social media marketing is established, the million dollar question is “How Does Social Media Marketing Drive Sales?” Focusing on correlated ROI, Ogilvy has analyzed the effect of social media on sales.

This week Ogilvy published a new study that shows the impact of social media marketing on retail sales. The study used five Quick Service Restaurants (i.e., fast food chains) and analyzed the correlation between social media exposure and changes in purchase behavior before and after the social media interaction. The results clearly show how social media marketing leads to more spending and consumption.


Multi-Channel Integration Boosts Spend and Consumption

Consumers who were exposed to social media marketing in addition to PR, OOH (out-of-home) marketing and TV advertising spent more money and consumed more food from the restaurants. The results show a sizable increase in sales:

  • People who were exposed to social media marketing and PR spent 17% more in the fast food category.
  • When exposed to social media marketing and TV commercials, consumers were twice as likely to eat more from Wendy’s.
  • Social media marketing and OOH also proved to be a good match, resulting in consumers being 1.5 times more likely to spend or consume more across the QSR industry.

Social Media Alone Yields Higher Spending

One other point worth noting in the study was the impact of social media-only campaigns. For KFC, people who were only exposed to social media marketing were seven times more likely to spend more money. How’s that for social media marketing’s impact on sales?


Motivation to Re-evaluate the Marketing Mix

These numbers should inspire us all. They should encourage retailers to revisit their marketing mix to make sure their marketing channels are integrated and optimized to drive sales. The statistics should also motivate marketers to, in the words of the legendary Vanilla Ice, stop, collaborate and listen to determine the multi-channel marketing approach that drives the most sales for their clients.

So back to the million-dollar question. Instead of asking how social media marketing drives sales, I challenge you to start asking how the right mix of social media marketing and multi-channel integration can drive sales for your company.

If you’d like to learn more about this topic, our very own Kevin Briody has written a post that breaks down the 4 types of social media ROI.

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11 Comments
  • Marcus Osborne
    Posted at 00:51h, 21 October

    The methodology of this project is suitably vague. The sample size is so small the findings are irrelevant. And “Consumers who were exposed to social media marketing in addition to PR,
    OOH (out-of-home) marketing and TV advertising spent more money and
    consumed more food from the restaurants” sounds to me like an ad agency desperate to justify/sell tradtional media platforms which is where they make all their money

  • Marcus Osborne
    Posted at 00:51h, 21 October

    The methodology of this project is suitably vague. The sample size is so small the findings are irrelevant. And “Consumers who were exposed to social media marketing in addition to PR,
    OOH (out-of-home) marketing and TV advertising spent more money and
    consumed more food from the restaurants” sounds to me like an ad agency desperate to justify/sell tradtional media platforms which is where they make all their money

  • Meredith Sparrow
    Posted at 19:46h, 21 October

    Hi Marcus. I appreciate you reading the post and sharing your opinion with us.

    The study tracked all brand exposure (regardless of type) of
    over 400 individuals over a 5-month period. Those consumers reported over 5,000
    interactions with the brands and a pre- and post-survey methodology was used.
    While a larger sample size is always welcome, this is certainly not one of
    those fly-by-night surveys of Facebook fans that you see published all the
    time.

    In addition, I think it’s interesting that they showed a
    decrease for Taco Bell, particularly since this study took place during the
    controversy over the “beef” the restaurant serves. That gives it some
    credibility in my eyes. 

    We’d love to see more research (pro or con). Please come
    back and post other studies as you find them. Thanks for the comment.

  • Meredith Sparrow
    Posted at 19:46h, 21 October

    Hi Marcus. I appreciate you reading the post and sharing your opinion with us.

    The study tracked all brand exposure (regardless of type) of
    over 400 individuals over a 5-month period. Those consumers reported over 5,000
    interactions with the brands and a pre- and post-survey methodology was used.
    While a larger sample size is always welcome, this is certainly not one of
    those fly-by-night surveys of Facebook fans that you see published all the
    time.

    In addition, I think it’s interesting that they showed a
    decrease for Taco Bell, particularly since this study took place during the
    controversy over the “beef” the restaurant serves. That gives it some
    credibility in my eyes. 

    We’d love to see more research (pro or con). Please come
    back and post other studies as you find them. Thanks for the comment.

  • Nick Stamoulis
    Posted at 14:15h, 24 October

    You bring up a good point about multi-channel integration.  Social media is important, but you can’t rely only on it by itself.  It’s important to have a diverse marketing approach with many touchpoints, increasing the likelihood that target audience members take notice.  

  • Nick Stamoulis
    Posted at 14:15h, 24 October

    You bring up a good point about multi-channel integration.  Social media is important, but you can’t rely only on it by itself.  It’s important to have a diverse marketing approach with many touchpoints, increasing the likelihood that target audience members take notice.  

  • Anonymous
    Posted at 14:23h, 26 October

    Intriguing how one size doesn’t necessarily fit all in this sharing you posted.  I think that there’s no perfect marketing mix when it comes to social media marketing as the Social Web is an ever-evolving plane, much like fashion on a speed of type – where one day you’re in and the next, you’re out.  I’d say just because getting social-digital is the trend these days, one must not forget traditional marketing.  But instead, come up with creative ways on how to engage your target market and keep the fire of conversation about your brand – burning like Greek fire.

  • aaroneden
    Posted at 14:23h, 26 October

    Intriguing how one size doesn’t necessarily fit all in this sharing you posted.  I think that there’s no perfect marketing mix when it comes to social media marketing as the Social Web is an ever-evolving plane, much like fashion on a speed of type – where one day you’re in and the next, you’re out.  I’d say just because getting social-digital is the trend these days, one must not forget traditional marketing.  But instead, come up with creative ways on how to engage your target market and keep the fire of conversation about your brand – burning like Greek fire.

  • Adammarleymtts
    Posted at 20:54h, 15 November

    Social media is important, but you can’t rely only on it by itself.

  • June Kent
    Posted at 22:58h, 04 January

    Social networking sites like facebook and twitter are now considered as an effective online marketing tool, well these sites are pretty famous and has a huge number of users that’s why some business owners tends to promote their products through these sites.

  • iphone diagnostic
    Posted at 22:58h, 04 January

    Social networking sites like facebook and twitter are now considered as an effective online marketing tool, well these sites are pretty famous and has a huge number of users that’s why some business owners tends to promote their products through these sites.

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