SOCIAL MEDIA POSTS IMPACT THE WAY CONSUMERS SPEND

Ram Bezawada, associate professor in the University at Buffalo said, “A neutral or even negative social media post with high engagement will impact sales more than a positive post that draws no likes, comments or shares.”

“This is true even among customers who say their purchase decisions are not swayed by what they read on social media,” he continued.

Researchers studied a huge chunk of data from a large speciality retailer with multiple locations in the northeast US. They combined data about customer participation on the company's social media page with in-store purchases before and after the retailer's social media engagement efforts.

They also conducted a survey to determine customer's attitudes towards technology and the same with they social media posts.

The study also found that business-related social posts significantly strengthen the effect of traditional television and email marketing efforts.

When social media is combined with TV marketing, customer spending increased by 1.03 per cent and cross buying by almost 0.84 per cent.

Cross buying refers to when a customer purchases additional products or services from the same firm. When combined with email marketing, customer spending increased by 2.02 per cent and cross buying by 1.22 per cent.

“The clear message here is that social media marketing matters, and managers should embrace it to build relationships with customers,” said Bezawada.

“Developing a community with a dedicated fan base can lead to a definitive impact on revenues and profits,” he added.

The study was published in the Journal of Marketing.