Can social media actually generate sales ? – Data

social media players

Do posts or ads on social media sites like Facebook, Pinterest and twitter actually generate sales? According to a new report from Business Insider the answer is emphatically Yes. And growing.

For while direct referrals from a social network may account for only a fraction of sales today, the volume of social commerce is growing quickly – in many cases in triple digits. Overall, last year social commerce sales grew at three times the rate of overall e-commerce.

Some key points from the report:

Social commerce is growing fast

According to the Internet Retailer’s Social Media 500, the top 500 retailers earned $2.69 billion from social shopping in 2013, up more than 60% over 2012. By contrast, the e-commerce market as a whole grew by only 17%.

First click vs. last click

Social commerce is even larger in terms of revenue generation when you look at where consumers begin their purchase process, i.e. first click, (as opposed to using traditional methods such as last click before purchase)

Buy buttons

Growth is very likely to accelerate and conversion rates improve as Twitter and Facebook roll out ‘Buy’ buttons; this will allow social-network audiences to initiate an e-commerce purchase by clicking on a retailer’s post or tweet. Facebook’s tests began in July, Twitter’s in September.

Facebook

Facebook is the clear leader for social-commerce referrals and sales: This is due in large part to the sheer size of its audience — 71% of US adult internet users are on Facebook. A Facebook share of an e-commerce post translates to an average $3.58 in revenue from sales, according to AddShoppers. On Twitter, a share or retweet is worth only 85 cents.

Pinterest

But other sites are gaining, and even leading on, specific metrics, such as average order value (AOV): Polyvore, for example, sees $66.75 in AOV from social referrals, according to Shopify. Pinterest sees $65, compared to Facebook which sees $55 AOV. Pinterest also drives more social sharing of retail content than any other network including Facebook.

Read more here.

Image courtesy of jscreationsz at FreeDigitalPhotos.net

Is This the Era of the Short Head ?

Rhino

Rhino, courtesy wildlife-pictures-online.com

Have you noticed how winners seem to win ever bigger these days. That one book/film/app/search engine etc. takes a mega-portion of the market, leaving all the rest fighting over a tiny slice of the cake?

Well, there’s a theory for this: the short head.

In the 10 rules of the short head, Dan Chen provides some persuasive statistics:

  • The top 10% of songs on iTunes get 86% of streams, and account for 90% of the store’s total sales
  • 2.7% of Amazon’s titles produce 75% of its revenues
  • 4.5% of apps generate 86% of the revenues, 0.1% generate more than 50%
  • 14% of movies generate 90% of revenues
  • Even in live performance the top 5% of artists get 84% of concert ticket revenues (56% of revenues going to the top 1%)

In January 2014 Oxfam claimed a similar type of concentration in terms of the world’s wealth – that the 85 richest people are as wealthy as the poorest half of the world.

So what about the long tail ?

All this is in stark contrast to the long tail, the theory developed by Chris Anderson in the early 2000s, that the future lay in selling less of more, that “our culture and economy is increasingly shifting away from a focus on a relatively small number of ‘hits’ (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail.”

The short head is essentially the opposite of the long tail, and appears to be prevailing: the present reality of business is selling more of less. But why?

Ring Tailed Lemur

Ring Tailed Lemur, creative commons

Choice and social media

One of the reasons lies in the sheer quantity of choice available. Who has the time to go through all the options, check out all the new games, listen to all the new bands?

Instead our attention is drawn to the  apps/songs/games etc. that get featured on iTunes, Amazon etc., the ones that are most popular, have sold most, have the best/most reviews.

And this effect is multiplied by social media. Here’s Dan Chen again: ‘New stuff spreads through social interaction and, thanks to social media, we now have hundreds a day, where before we might have had just a few. Thus we adopt much faster.’

It took the telephone about 75 years to reach 50 million users. The app Draw Something achieved the same milestone in something like 35 days.

Instead of broadening our horizons and nurturing our unique, niche interests – it turns out we all want the same stuff.

Is the news all bad ?

I don’t think it’s time to throw in the towel just yet. To some degree at least, there are a huge number of niches in the tail, and the internet has enabled huge numbers of small businesses and solopreneurs to find a market.

We may not be making fortunes but, in many cases, we are making a living.

And there’s always hope: The developers of Angry Birds released 51 apps that failed to make an impact before hitting the jackpot.

Furthermore – though this cuts both ways – there’s no clear map to hitsville for big business or micro business (see this post on Seth’s blog).

Gartner’s January 2014 report says that less than 0.01 Percent of Consumer Mobile Apps Will Be Considered a Financial Success by Their Developers Through 2018.

“The vast number of mobile apps may imply that mobile is a new revenue stream that will bring riches to many,” said Ken Dulaney, VP and analyst at Gartner. “However, our analysis shows that most mobile applications are not generating profits and that many mobile apps are not designed to generate revenue, but rather are used to build brand recognition and product awareness or are just for fun. Application designers who do not recognize this may find profits elusive.”

How to Knock Off a Bag

Why are expensive leather bags so… expensive?

Watch this brilliant and witty video by Dave Munson of Saddleback Leather Co. and you will know.

In the video he shows pirates how to knock off his bags, and demonstrates that the only way to make his products cheaper is to make them worse. Use lower quality leather, lower quality thread, more seams etc.

By the end of the video you know just how good his bags are – and you want one.

Of course I want a bag with straps consisting of two long continuous pieces of high quality leather, not scraps spliced together. I want a bag which uses highest quality 316 steel for the buckles, not nickel plated plastic; that’s stitched together not with cheap cotton thread but with the finest and strongest continuous filament polyester thread. And, most especially, I want a bag that I know has been made by artisans, not child labour.

Specifically I want a front pocket briefcase. Simply gorgeous. You can see it at saddlebackleather.com.

I bet you’ll want one too.

 

Are cards taking over the web?

Have you noticed how cards are gaining traction as a new web design standard, a response to the need to make content work across the widest range of formats, from desktop through tablet (landscape and portrait) to mobile – and potential new devices such as Google glass.

twitter cards

Benedict Evans pointed to the changing face of Twitter, and the potential it opens up for content marketers, in his post Twitter, canvases and cards:

Then Twitter pivoted … and took control of the interface. The obvious thing that it did with that was to deliver a predictable offer for advertisers. But the more interesting thing to me was that it created a canvas – which is now turning Twitter from a protocol to a platform.

Twitter is turning ‘Twitter cards’ into a platform. You can embed video, or slides, or music – all sorts of things. You can embed a call to action that will harvest the account’s email address. And, increasingly, you can drive acquisition – of Spotify users, or apps, or customers. And thanks to retweets these cards can end up anywhere on Twitter, far beyond the original poster’s network.

What are cards?

Cards give a quick shot of information, a summary, with the ability to link to more content. You can also mimic cards in the physical world, with content on the reverse, turning the card with a click.

Cards can be used to provide an aggregated approach to content, a screen filled with nuggets of information (i.e. cards) assembled by the site according to your previous interactions, very much like Pinterest which provides a different home screen for every user, based upon your previous pins.

This is easily adapted to the mobile screen by using a ‘deck of cards’ structure. As described by Insideintercom:

This [mobile] is driving the web away from many pages of content linked together, towards individual pieces of content aggregated together into one experience.

Google+ cards

Google has also moved in this direction, with a frequent appearance of a right hand panel in Google results and the re-design of Google+.

Cards offer scalability, flexibility and a clean look from desktop to mobile. A way to provide the user fast access to the information she wants, whilst also allowing space for serendipity – for putting content in front of the user that he didn’t know he wanted. Not wholly unlike the kind of experience (that used to be) offered by flipping through the racks at a record store.

Self promotion follows!

Want to know more? Or need a copywriter who knows how to make a modular approach to content work for you? Then do get in contact.

Facebook and the fine art of losing friends

Perhaps it’s only to be expected from a ‘friend’ site created by someone who (reportedly) had few friends, but every time the service makes an announcement it unerringly alienates another tranche of members (or should that be ‘customers’?). And now it’s doing the same with Instagram, the photo manipulation and sharing service it purchased some months ago.

The divergence of interests between the sites and their need to make money, and the users who are used to getting everything for free – and don’t welcome any suggestion that the content, created by them, is to be exploited – is the big fault line now appearing across all new media, and particularly social media.

Here the big problem is, of course, that Facebook was wildly over-valued in its IPO, and it paid far too much for Instagram. The need to start to make money is therefore pressing. But you would’ve thought (with all that money) they might be able to communicate with their members a little better than they are at present. Instead, they seem to see every announcement and every change as an opportunity to lob a metaphorical grenade into the user experience, and then have to spend the next weeks and months clearing up the mess.

I suspect they have little or no interest in the vast majority of user-generated content, but are trying to find a formula that will enable them to jump on the coat-tails of posts that go viral (e.g. gangnam style). Either that, or they’re softening up the members with this stream of smaller shocks so that when they eventually drop the bomb, no one pays it any attention.

Optimizing your Pinterest page

Pinterest is the fastest growing social network, and is now embracing business with its business pages (it wasn’t long ago that business was banned but, hey, Pinterest is ‘pivoting’).

So it’s a good time to get on board and make the most of this opportunity to attract more traffic, leads and customers to your business. This great infographic by Tehmina Zaman of Entrepreneur TV has solid advice on making sure your efforts reap rewards:

10-Ways-To-Optimize-Your-Pinterest-Profile