The influence that brand activity on social media has on purchase intent is a hotly discussed topic, and for good reason.

For many organizations, a direct correlation between social media activity and sales is difficult to prove. And even when it can be proven, the scale of those sales is frequently questionable at best.

While I certainly don’t believe that it is impossible to drive sales results at scale through social media activity – just look to social media giants Red Bull, Starbucks and Go Pro as obvious large-scale proof points – I do believe that it is this attempted measure of a direct correlation that leads so many to doubt that their social media activity is having a meaningful effect on driving sales.

What we should be attempting to better understand is the indirect influence that brands have on social media in driving sales and other business-related outcomes.

Before I touch on the indirect influence that brands have on social media, I’ll first share a couple of stats: in the Gallup 2014 State of the American Consumer report, it was found that brands’ social media activity only had ‘a great deal of influence’ on the purchase decisions of 5 percent of consumers, and ‘some influence’ on 30 percent of consumers.

At first blush, these seem like grim statistics in support of social media having real influence over purchase behaviour.

What these numbers don’t take into account is the indirect ripple effect of influence.

It’s relatively well researched and documented that the most persuasive influence on purchase is recommendations from friends and family, including those through social posts.

In fact, it has been found that the social posts of friends and family directly influence the purchase decisions of 81 percent of people (source). This is a huge percentage of people that admit to having their purchase decisions influenced by the social posts of friends and family.

Let’s crunch some numbers to put this into real terms for businesses and brands:

THE DROP – BRAND INFLUENCE AND LIVING UP TO BRAND PROMISE

Assume a case where a brand has a social media audience of 10,000 people and that brand is able to influence 5 percent of that audience to make a purchase – that’s 500 people.

Let’s also assume that each of those 500 people had an amazing experience with the brand, the product or service they purchased exceeded their expectations, and their subsequent interactions with the brand were consistently excellent.

THE FIRST RIPPLE – CUSTOMER INFLUENCE ON OTHERS

Now, if each of those 500 customers has 200 friends and family members as part of their social graph – which only accounts for the average number of Facebook friends (source) – and they are able to influence the purchase of just 1 percent of their friends and family members, that would equate to additional 1,000 purchases. Not bad.

THE SECOND RIPPLE – SPREAD OF CUSTOMER INFLUENCE

Apply the same assumptions and numbers to those new 1,000 customers, and the number of new customers doubles. Now we’re getting somewhere.

THE THIRD RIPPLE – CUSTOMER INFLUENCE OF SCALE

Apply the same numbers again, and the number of new customers – you guessed it – doubles once more. Now we’re seriously talking influence at scale.

You can see that this ripple effect of influence doesn’t need to occur very many times for the total number of influenced purchasers to be significant. The main challenge, however, is to determine how to go about influencing, and sustaining influence, over those original 5 percent of customers to set this ripple of purchase influence into effect.

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It is clear that the focus of influencing purchase decisions through social media doesn’t need to be on influencing vast numbers of people.

The focus needs to be on influencing the purchase of just a small percentage of people, delivering an amazing brand experience to ensure they will influence others, and continuing to deliver that experience to maintain the momentum of your business’ ripples of influence.

I fully understand that the idea of influencer marketing in the context of social media is nothing new, but it is my hope that this post provides some context and clarity on the power that social influence can have on purchase behaviour.

How do you provide the kind of brand experiences to your social audience to ensure they become devout influencers?

Do you have any methods to share for how to measure this sort of indirect influence?

Do you have any personal or professional experience that you can share of this sort of effect in action?

It would be great to chat with you more about this in the comments or on Twitter @RGBSocial

Join the conversation! 2 Comments

  1. […] to the company, including CLV, customer referral value (CRV), customer influence effect (CIE), customer influence value (CIV), as well as value to the […]

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  2. […] can see this blog by RGB Social which speaks about the “ripple effect” of social media here or view a 2012 TedX talk by Sinan Aral […]

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Analytics, Marketing, Measurement, ROI, Social Media Strategy

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