The massive popularity of apps such as Snapchat, Instagram, and Facebook, among others, has fostered the evolution of a new market: E-Commerce. According to the American Academy of Child and Adolescent Psychiatry, nearly 90% of all teens (aged 13 to 17) and 60% of all adults with internet access use social media outlets. With such a broad demographic of users it is clear just how much potential exists in social media marketing.
The urge for convenience has driven consumers online where stores contain every imaginable product just a click away. It is estimated that E-Commerce sales will reach over $725 billion by the year 2023. With such a staggering potential profit, companies must strive to steer the flow of online consumers towards their products or risk drowning in the evolving market.
As entertainment continues to change, the price of reaching a target market has become incredibly steep. The estimated cost to reach a thousand people, or CPM, through broadcast TV is estimated at around $28 but a measly $2.50 through social media. That means that for the price of eating out a company could advertise to 11,000 people as opposed to only 1,000 if they used social media over television.
Many of the “outdated” forms of advertising such as mail, physical newspapers, and television appear blunt and rude compared to other forms of advertising. They offer a one-way communication between company and client that demands the client’s attention, making the consumer feel alienated by the company (Boateng & Okoe).
Social media, however, offers a broader approach to communication by allowing clients to show support for ads, leave comments, and even share them to friends and family. This apparent relationship makes it seem as though the company were just another friend or entertaining post on our feed.
Without a personal connection many people feel used by companies, so the ability to create and maintain a personal relationship through social media is an invaluable asset to any corporation.
In a study by Boateng and Okoe, for the Journal of Research in Interactive Marketing, they found that consumers consistently attribute human characteristics to companies based on public opinion, product quality, philanthropic gestures, and many other factors.
This projected image on the company is often regarded as a person and their research showed that when talking about a company, people were more likely to talk about it as if it were an acquaintance or a real person.
The reputation a company earns is not just for show either, many customers keep past experiences and company morals in mind before actually buying a product. Corporations big and small are constantly kept in check by consumer power which is influenced often by what is seen on social media.
One of the main benefits of social media advertising is its ability to entertain an audience. Obviously television ads have taken note and attempt to amuse and influence consumers while they are watching a show, but this is perceived as intrusive and annoying. People watching a suspenseful drama don’t want to have to wait till the end of an amusing, but disruptive, burger advertisement to see who the killer is.
A study has found that ads that are perceived as intrusive are much less likely to be effective at influencing action than those which appear as part of the entertainment (Bronner, Fred, et. Al). The study named Google+, Pinterest, and Instagram as three of the most effective social media outlets that integrated their ads into the flow of entertainment, all of which are used by tens of millions of people around the world.
It quickly becomes apparent just how powerful social media is in the role of E-Commerce. A well placed ad for the price of a good meal could drive thousands of potential customers to a site, the comments and feedback that consumers are able to give corporations create trust and foster profit, and with the majority of adults and teenagers who use social media there is no limit to who will see an ad.
As convenience and connections grow and evolve in our age companies must take larger strides to keep up. They must appeal to us as compassionate, innovative, and entertaining people not just as a faceless corporation. Businesses must turn to social media advertising and leave behind the intrusive and overpriced advertising of the past or risk losing any hope of staying relevant.