It’s no longer news that social networks can influence buying decisions. No business or marketer can deny the relevance of social media in business development. According to a study, 71% of consumers admit that they may purchase an item because of social referrals.
Years ago, only a handful of people would believe the influence social media would have in the business world in the future. Today, social media has become an integral part of every business.
Companies set aside a budget for social media marketing. They rely heavily on social media to achieve their sales target, grow customer base and revenue.
So, how are social networks influencing buying decisions? Keep reading for more information.
1. The Power Of Social Proof
Gaining positive social proof is now a goal for many companies. Companies are learning the best strategies to deploy to help attract more online shoppers.
However, the amount many companies are budgeting for social media marketing every year will give you a clue of how vital these platforms are to the business community and why you should tap into it.
These social media platforms have a huge user base. Instagram alone has over 1 billion users, as of the time of writing. The platform has huge potentials that businesses are looking to tap into.
Social proof can impact any business. Most clever entrepreneurs and brands are aware of this. It has huge potentials and can help businesses achieve their sales and marketing goals in no time.
Now, what does social proof means? First, it’s also called informational social influence. Social proof referrers to a situation whereby a consumer assumes that the actions others portray are correct based on the frequency that they find them doing it.
The likes, comments, reviews, and ratings you find on most social networks, help businesses build social proof.
Check out two similar products with reviews on the e-commerce platform, Amazon. You will find that the one with more positive reviews and ratings have recorded higher sales.
The reviews are from real users, not one provided by the brand. A strong social proof sends the right signal and attracts consumers to a brand.
A study conducted by Harvard Business School reports on reviews, particularly on Yelp, indicates that Yelp’s positive review can be highly beneficial to a business.
The research stated that a one-star increase on Yelp could increase revenue by 5-6 percent.
On the other hand, a single negative review can lead to a loss of 30 or more customers. So whether positive or negative, social proof can influence buying decisions. The only difference is that positive social proof leads to gains, while negative leads to losses.
However, Yelp is not the only platform where such can happen. It can happen on Instagram, Facebook, Twitter, and other social networks with a massive user base.
So, why does social proof influence buying decisions? It’s simple.
Most consumers believe that a business or product with higher positive reviews is more credible, trustworthy, and popular. In this case, the seller doesn’t even need to do much to convince them to splash the cash.
Now, what is engineering the evolution of social proof? It’s social media. And another compelling reason why social proof is having such a huge influence on buying decisions is this. Many individuals are trying to imitate others whom they believe boast higher influence.
A satisfied consumer may decide to not only praise a product or service but share a review, comment, like or even create a video review. The customer may have acted without being coaxed into doing that. But that single act can bring more business to the product’s owner.
That is why many businesses don’t take such reviews lightly. They know how powerful and influential feedbacks from real users can be. When you visit most weight loss websites, you may find reviews of various users of the product.
In most cases, the product seller might pin the most eye-catching reviews and make them more visible for people to see. Doing so can increase the conversion rate.
The bottom line is to hunt for positive social proof. Look around the various social platforms to see where a consumer gave a nice review of your product or service.
Not only reviews. You can also use images, case studies, podcasts, videos, and interviews to blow your marketing and selling strategy while building your social proof.
Here are some statistics explaining the power of social proof:
- 57% of consumers admit that they can only purchase a product or use a service if it boasts at least a 4-star rating.
- 97% of consumers have admitted that online reviews influence their buying decision.
- In a 2018 eMarket survey, 100% of the participants, aged 18-29, admitted to checking reviews before making buying decisions.
- 70% of Americans seek reviews from independent social platforms before making a buying decision.
2. Social Media Influencer Marketing
The word “influencer” is no longer new to social media users, marketers, and brands. Social media influencers are making a name and building wealth for themselves on various social media platforms.
These social media influencers are available on Instagram, Twitter, Snapchat, and even Facebook. And they have massive followers with almost everyone being active.
However, Instagram keeps proving to be a strong force in influencer marketing. Instagram has over a billion users, which grows daily. So, if you’re seeking social media influencers or want to toll this path, you can start with Instagram.
Influencers are also not to be confused with celebrities. The latter gained public recognition because of their talents. But influencers are people who have rebranded and projected themselves as experts of the social network.
But keep in mind that both influencers and celebrities can influence buying decisions.
Influencers are also super easy to identify on any social network. Besides their massive followers, influencers share authentic stories and boast a decent number of posts. Most of them also have their accounts verified by the social network.
The power of influencers is so evident that they are now making brands rethink their choice of brand ambassadors. Many brands have started replacing celebrities and brand ambassadors with Instagram, Twitter, YouTube, and Snapchat influencers.
Influence can influence anything, from religion to politics.
Influencers are a great tool in the hands of any social media marketer. Brands are even teaming up with them to launch new products and build social proof.
According to research by the Influencer Marketing Hub, approximately 50% of Twitter users admitted to having bought something because of one or two tweets from a social influencer.
Over 54% of social browsers research for products and services via social media, according to GlobalWebIndex 2018.
Most consumers are also willing to buy a product or use a service when they get a recommendation from a person they trust. They tend to value such recommendations because the individual who gave them has no link to the product or the manufacture. And that’s what influencers do on social media.
Here’s an example. An influencer gamer might decide to endorse certain technology or gaming products.
The followers trust and respect the recommendation from this influencer. Therefore, they won’t hesitate to splash the cash on the said product. All the influencer needs to do is talk a little about its benefits or mention that the said product is in use.
Note – What makes influencer marketing more effective and the result almost instantaneous is that there’s an already existing market. The influencer doesn’t have to convince the followers to choose a given product.
3. The Power Of User–Generated Content:
User-generated contents are another powerful tool that can influence buying decisions, yet many brands haven’t started tapping into it.
First, what is the user-generated content?
As the name suggests, user-generated content can be any content, such as reviews, videos, images, etc., posted by a consumer.
The content doesn’t come from the brand but happy customer, who feels so excited to share his or her feelings about the product.
Anyone can create user-generated content. And you mustn’t be a social media influencer or a celebrity. Just write your reviews or create the video, image, and share it on your page or other media. Before you know it, that tiny feedback will generate massive sales.
According to Gartner’s research, 84% of millennials may decide to buy a product because of one or more user-generated content made by a stranger.
Brands can also use the power of user-generated content to further rebrand their business and achieve marketing goals. That’s because reading stories and watching products being used by other consumers can influence others’ buying decisions.
There are countless pieces of evidence on how user-generated content impacts brands and their marketing strategies.
The lives of many users have also been transformed after creating their first user-generated content. Many of them have become brand ambassadors overnight.
A good example is Covergirl’s relationship with Nura Afia and James Charles, two well-known beauty vloggers.
However, working with Nura Aria alone has given Covergirl a chance to tap into untapped opportunities. The brand has a keen interest in capturing the Muslim market. They understand that Muslim women have felt so distant and ignored by the cosmetics and beauty sector.
It’s no longer news that Muslims will spend billions of dollars on beauty and fashion products.
4. Customer Engagement:
Word-of-mouth marketing was made easier following the advent of social media. Social media let consumers and brands interact with ease and build solid relationships.
Customers feel special when given the privilege to interact with a representative from a company. They feel loved and emotionally connected to the brand when this happens.
Another thing you need to understand is that an engaged customer won’t just be an informed customer. Proper engagement can lead to a boost in market share and even revenue.
What is customer engagement? It refers to an emotional connection between a brand and a customer.
According to Gallup research, fully-engaged customers represent a 23% increase in revenue on average. And these sets of customers are most likely to make the most purchases, promote more, and are loyal to the core.
Influencers and celebrities have a high chance of influencing millennials’ buying decisions. But that doesn’t imply that the brands have lost their voices. They haven’t.
The most important thing for brands is to create a working strategy on how to engage customers. Understand that customer engagement should come first before promotion and advertising.
Over 64% of customers who participated in a survey admitted that they have a high chance of becoming brand loyal when a brand engages them, even on social media.
Now, why are brand loyal customers the real deal? This set of customers can drive sales. They can create social media proof for the brand without receiving anything in return.
There are also cases where brand-loyal customers became a brand ambassador after got so bonded with the brand.
Note – A business that doesn’t have a customer engagement strategy could miss out on many opportunities to interact and build a healthy relationship with customers.
5. Appraisals And Reviews From Friends And Family
Have you at any point in time decided to buy a product because you find a friend or relative using them? Finding your friend or relative using the product can make you conclude that the product is worth the value of money.
Most people have had to buy a shoe, dress, watch etc, from their friends and families because they find it super cute on them.
That’s the power of appraisals and reviews from friends and families. They can influence buying decisions massively.
Social media has even made getting appraisals and reviews from a distant relative a breeze. Just ask about the product and wait for a reply.
According to a study, 80% of people might agree to buy a product because they had suggestions from their peers or family members.
That percentage alone tells you how influential reviews and appraisals from family and friends can influence buying decisions.
Social networks haven’t only changed our lives. They have also transformed businesses, including offering digital marketers, diverse options to choose from.
When used properly, social media can influence buying decisions. It can also help businesses to increase their customer base, revenue, and reputation, in no time.
Social media marketing is also cost-effective compared to traditional advertising. Its output can also be more massive.
So, if you’re running a business and are yet to leverage on social network power to influence to grow your business, then you need to get to it right away.