What is all the Hype about Social Media Influence

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Everyone is looking for the next big thing in Internet marketing, and when you look at the statistics it would seem that social media outlets like Facebook and Twitter are just that thing. It is estimated that about 1.5 billion people use social media outlets daily; that is an increase of 19 percent over last year, and that number is expect to rise exponentially. That is approximately 65 percent of total Internet use. Facebook, with its nearly 900 million regular daily users, makes up the bulk of those numbers.

Logically it would seem that tapping into even a portion of those users would translate to more contacts and bigger sales revenue, so marketing specialists are urging businesses to jump into using social media for marketing and gaining brand recognition.

However, early data shows that popularity on social media networks is not having a big affect on the bottom line of many companies who use them for revenue generation purposes. A recent study conducted by Forrester found that out of 70,000 online sales conducted in April 2012, less than one percent of the transactions could be linked to social media outlets.

There could be several reasons for this, not the least of which is the nature of social media usage itself.

Popularity Versus Influence

Popularity is a measure of the favorable association of a brand or company. Influence is a measure of how much that favorable association plays a part in changing consumer behavior.

Sites like Kred and Klout hype social media’s popularity component, but what do their numbers actually reflect? They mostly measure one’s level of popularity on various social media sites such as the number of likes, shares, and re-tweets, but they don’t really measure how much that popularity generates real social media influence.

A more accurate reflection of how affective your web marketing efforts are in influencing consumer behavior are applications such as Google Analytics, which breaks the numbers down by category and tells you exactly where your revenue is coming from. Appinions also measures your level of influence beyond what social media offers.

Detailed, revenue and influence-specific analysis are a more reliable indicator of the amount of influence your marketing choices have on customer behavior. When you know exactly where your money is making you money, it is easier to make decisions about the allocation of your marketing budget.

Social Media Versus Traditional Web Marketing Strategies

Ordinary influencers like email and search engine-focused advertising are better at revenue generation. These marketing efforts are more targeted and specific. When people want to socialize, they turn to social media; when they want someone to fix their sink, they look for a local plumber on Google. Email marketing campaigns are more effective at incurring repeat business by informing existing customers of special offers and upcoming sales.

Though it is possible to purchase social media influence, or at least purchase an increase in visibility on social media sites, there is little reliable data that such an expenditure translates to sales. Facebook recently admitted that their numbers are greatly exaggerated when it comes to how effective business marketing on their site is at influencing consumer behavior.

Final Verdict

While social media outlets can create an initial ‘buzz’ about a new product or company, efforts in this area usually bring only short-term attention but not any real, sustainable actions. The amount of time, money, and effort to sustain an effective social media campaign and keep the buzz going makes this avenue seem a less attractive expenditure than other web marketing techniques.

The studies in the area of social media’s influence on consumer purchases are still preliminary. Early data suggests that while social media is an effective tool in establishing and maintaining regular interaction and contact with customers, your money is better spent on the tried and true methods of turning prospects into sales.

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Randy Bowden

Randy Bowden

Principal Partner at bowden2bowden llc
Randy is a Principal Partner of bowden2bowden llc, a marketing and branding consultancy firm. Specializing in developing targeted marketing solutions, exceptional creative executions and solid branding strategies that give clients a real competitive advantage. Randy writes two posts weekly here, bowden2bowden blog and is the producer and host of the interview series marketer2marketer "a conversation."
Randy Bowden


a marketing and branding guy | native floridian - georgia transplant ☞ southern enthusiast | bourbon or single malt | @Shalahb2b | http://t.co/d0oQxZ1Cbr | 
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Randy Bowden
Randy Bowden
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  1. Great post Randy.
    I would add to the final verdict though that a company can't abandon social media even though it may not produce as much revenue as traditional web based marketing. Once you have someone's attention over social media you can keep your brand top of mind through engagement. I agree that most people use Google to find what they need and therefore web marketing, seo are completely necessary, however I would suggest to do both traditional web and social media as much as possible.

  2. elisabethubervu says:

    Really interesting topic, Randy – thanks for putting it out there! I think there's something important that's not being discussed here, though: the overlap and intersection between social media platforms and other digital marketing efforts. A really successful digital marketing campaign ties together the more "traditional" digital marketing techniques like email and search with newer techniques that include social platforms. The SEO benefits of social media are there (especially with blogging) and even though not every social mention can be tied to sales, many people have discussed lately how social media feeds into email/search/web traffic through "dark social" – I like The Atlantic's coverage of it here: http://www.theatlantic.com/technology/archive/201….

    In addition, I wanted to touch on the concept of influencers. While popularity alone isn't an indication of influence, as you mention above, my team at uberVU and I really believe in the importance of CONTEXTUAL influence, which considers someone influential only if they are driving actual engagement and conversations around a particular topic. We designed our product to look for influencers who are driving the conversation around your brand or market by generating RTs, comments, likes, shares. We also set it up to ignore the 'influencers' with millions of fake fans and no actions. These people are also the ones whose influence drives "dark social" interactions and buzz beyond what happens on Twitter, Facebook, LinkedIn, etc.

    Interested to hear your thoughts! (and sorry for the lengthy reply)
    - Elisabeth, uberVU Community Manager

  3. I appreciate your input Elisabeth. We have spoken about the "overlap" many times and totally agree that the engagement on the social channels has an increased value to other efforts, example: http://bowden2bowden.wordpress.com/2012/09/26/the….

    I wish you and the team the best of success at uberVU and agree with the real value is "Contextual Influence!" However when it comes to automation, it kinda takes the social out of social media, many think.

    • elisabethubervu says:

      Looking forward to reading your SEO post – thanks for sharing the link! As far as automation goes, I agree that it's a bit of a marketing "dirty word" right now. There's an important distinction to be made between what I see as full automation (Auto DMs, for example) and automation of data-gathering/processing to enable social media managers to engage socially and authentically (which is what we hope to achieve with uberVU). So basically, automating the background noise to make it easier to spend less time being yourself :-)

      • I think a brand's goal is to rise above the noise with compelling content, not create it! Your thoughts Elisabeth?

        • elisabethubervu says:

          Absolutely! But there are a lot of people out there making noise about lots of different topics, so it's important to know what they're saying (and what the trends in what they're saying are) so you know HOW to rise above it with your own content.

          • Exactly, seek, develop and distribute relevant targeted content to you audience and do it "right" and you naturally rise above the noise. The trick is doing it "right!"

  4. Randy Hi,

    great post. I agree with you in majority. The problem we are seeing today with so called "influence marketing" is that tools available on the market are only measuring one thing Awareness. I said it many times and I will say it again, actions or reactions doesn't put money into marketer pocket but persuasion does. I do believe that influencers can help you increase revenue if they are selected correctly. Influence is power to sway, so in order to do so, marketer need to look for users who with certain action change the behavior in others. Now RT, @ and shares are not behavioral changing actions, but they are action of increasing awareness.

    The trend today is clear everything is moving towards mobile. So i do suggest to start focusing on objects itself and what objects used for communication represents to people. People perceive message different based on the device they receive the message to.

    I would also argue that traditional media can still be very helpful if incorporated in social strategy, but way to many brands omit traditional media component.

    • Thanks Jure, it is always nice to have your input and always enjoy the conversations. I see so many working in the social space as "marketers" who really never connect the dot back to the bottom line! If they are getting likes or follows, etc. then they must be putting money in the bank. What should be stressed is the unique brand awareness and hopefully "favorable" engagement that will pay-off down the line when the consumer/client is in need and recalls.

      I have written several times on the mobile shift and stand in agreement with you on this fact. I have a new post coming out next monday on my blog "Tailoring Your Business to Mobile Internet-Ready Devices."

      As for traditional media, it certainly is far from dead! We all have heard many declare it so. I do agree there has been a great and exciting paradigm shift however: http://www.steamfeed.com/traditional-marketing-st

  5. Thanks for the post, Randy. It made me think. And the comments debate is equally stimulating. I'm in agreement with the theme of needing a blend of approaches in the new 'converged media' landscape, one that includes social media. Also, what is your take on blogs? They are a social media tool, but not on a defined, walled platform, so they may be better at creating influencers for particular niche subject matters; and the other social media channels can be useful in engaging with them.

    • Thanks Hugh for jumping in…blend of approaches is a nice way of putting it! Blogs are an awesome engagement tool and certainly one that will set you apart (via search) if done properly. Develop and deliver the information that your audience (clients/customers/prospects) want and keep it defined and constant. For sometime and still today many wanted to build their sites as the got to for all, thinking it would build a landing spot that would stick. Very difficult and very expensive, also time consuming. Be good at what you do and get better!

  6. Unfortunately however whether we like it or not, Companies are looking at how their employees are using Social Media etc and thus we have to have a Social Media Presence….

  7. Carly thanks for your comments but I do not totally agree with your statement! I really do not believe in the cookie-cutter approach to marketing for my clients. Just because company A is doing it does not mean company Z needs to do it! If it fits their niche then yes by all means but it is a fact there are many SMB's that are wasting money and time being in the space…

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