Retailers shift their ad spending from TV, radio and print ads to digital ads.
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But those promotions aren’t just about driving revenue, Kowit says. More important, purchases generated from Ice.com’s Facebook page help the online jeweler learn more about what’s driving shopping behavior among its most loyal customers. “We are still very early on in understanding social commerce because people don’t go to our Facebook page just to shop,” Kowit says. “They come to our Facebook page to immerse themselves in what they like and don’t like about jewelry, and the purchases they make give us insight into what they find engaging about our customer experience and what’s not.”
The Internet Retailer survey found that 71.6% of merchants view Facebook as the social media outlet that’s the most effective for generating online sales compared with 13.6% for Twitter and 8.6% for Pinterest. A total of 74.2% of retailers currently advertise on social networks or plan to within the next year.
Most online retailers maintain only a very small full-time staff dedicated to social media marketing and commerce, with 49.4% of merchants having only one full-time employee concentrating on social media.
But there are exceptions, such as W.W. Grainger Inc., a business-to-business distributor of industrial supplies and spare parts, a category known as maintenance, repair and operations, or MRO. Grainger, whose annual e-commerce sales exceed $2 billion, is a relative newcomer to social media and has been on Facebook less than a year. But Grainger already has four full-time employees working on social media initiatives and expects to increase the number of dedicated social media analysts and designers to six within a year, says senior director and head of online/digital marketing Pavez Patel.
Growing its social media base quickly is strategically important to Grainger as it looks to engage and build long-term relationships with next-generation MRO buyers, Patel says. “Many of the current executives who make MRO purchasing decisions and our current buyers will begin to retire in the years ahead,” Patel says. “We are using social media to engage younger buyers making their way up the organization in the channels they use to engage each other, and that’s on Facebook and LinkedIn.”
Using social channels like LinkedIn, a network for businesspeople and professionals, also helps Grainger reach individuals interested in very specific business-to-business topics, such as finding and hiring skilled workers and workplace safety. A recent forum on LinkedIn on the employment outlook for skilled tradesmen drew 133 participants.
But more important for Grainger, the experience helped Grainger use social media to identify MRO professionals with a particular interest in a topic important to them, Patel says. “Grainger wants to shift the public’s perception of the skilled trades and wants to take the conversation from ‘jobs’ to ‘careers,’” Patel says. “LinkedIn was chosen as a medium for this discussion since it is a channel targeted to the discussion of careers, workforce development and networking.”
That’s an example of how many online retailers are viewing social media: an important way to engage important audiences, even if not yet an important way to boost sales.