NEW YORK (MainStreet) — Retailers rely on social media to connect with customers, but a new survey sheds light on how digital interactions could impact consumer spending.
According to Collective Bias, a retailer’s fan on Facebook spent about 50% more than those who weren’t connected to the store on the social media site.
The report analyzed a regional grocery store chain’s 600,000 loyalty members both before and after the user “liked” the retailer on Facebook.
It found those who posted on the store’s Facebook page at least ten times spent $1,000 more each year and purchased 35% more items.
“This study was conducted to help marketers solve measurability challenges when it comes to social's role in driving sales," said Bill Sussman, CEO of Collective Bias.
The major question for retailers is whether or not “likes” translate into incremental sales.
“Incremental is the key word,” Columbia Business School professor Kinshuk Jerath told MainStreet. “Likes are good for brand communication, but shares are useful, since you’re likely sending it to people who do not know the retailer or are unaware of a particular promotion, which helps to reach new people in a word of mouth type of way.”
Followers of a retailer on social media already have a favorable opinion of the brand and are likely shop at the store regardless of how much they post on its Facebook or Twitter page.