It is officially time to start questioning whether the folks over at the normally reliable firm Forrester Research have it out for the social shopping movement.
For the second time in less than a month, a report tied to Forrester has emerged challenging the notion that incorporating social media as part of a broader retail strategy is a worthwhile endeavor. Our regular readers already know about the first report, in which Forrester’s Sucharita Mulpuru argued emphatically that F-commerce will never flourish as many have predicted. Mulpuru’s report also downplayed the effectiveness of social media features such as the Facebook Like button as a retail tool as well.
Now, Forrester and GSI Commerce have teamed up for a new study that essentially says the same thing—retailers are wasting both time and money on their social media efforts because social media has virtually no influence on online purchasing behavior.
The GSI/Forrester report used data collected between November 12 and December 20 of last year to determine that less than 2 percent of all online orders during that time were the result of shoppers using a social network. That success rate jumped modestly, to between 5 and 7 percent, for announcements of short-term deals and promotions on social networking sites.
And as was the case with Mulpuru’s study, this new report also says that retailers would be better off focusing instead on traditional marketing techniques such as paid search and email instead.
“It’s been a mystery to me why the media is excited about social media,” Fiona Dias, GSI’s executive vice president of strategy and marketing, told Mashable. “From a retail and commerce perspective, it seems to have no effect.”
We’ll get to Fiona Dias in a moment but first let’s focus on Forrester because it looks like they’re involved in another piece of shoddy research.
Mulpuru’s report relied on the testimony of about two dozen retailers, marketers and technology vendors to support her claim that F-commerce was a waste of time. That’s 24 participants in a movement that now boasts, at minimum, a few thousand companies and brands. As we pointed out at the time, it was baffling, not to mention irresponsible, to take such a small sampling and claim that it is representative of an entire trend.
But lo and behold, Forrester and GSI did something similar this time around. Rather than use an expansive period of time to get a truly accurate look at how social media was involved in online sales, they instead relied only on a six-week period during the holiday shopping season. It would be somewhat understandable if ‘social media conversions’ were a bit low at that time of year, if for no other reason than many shoppers already have established holiday shopping practices in place and are inundated with so many other options that they could easily forgo social shopping, a practice that many are still learning how to best use.
So just to summarize, in the course of a month Forrester has definitively written off the potential for F-commerce based only on the testimony of two dozen companies in one case and a small window of time in the other.
While Forrester’s questionable research tactics certainly jump out when you look at both reports, the other red flag in our opinion is that in each report, retailers are advised to forgo social media work and instead rely on paid search and email marketing instead.
Now we’re not here to say that those two marketing vehicles don’t have their merits or should be ignored by retailers. But how do we wrap our head around GSI’s assertion that social media marketing is a waste of time when all we’ve seen for the past year or so is MORE merchants expanding to social networking sites and diversifying what they do on those sites? Dias, in her discussion with Mashable, went as far as to say that she advises her clients directly to avoid social media work altogether.
Could it be that email marketing and paid search are so heavily emphasized by GSI Commerce in particular because that’s their bread and butter? Take one look at the Marketing Services section of the GSI website and you’ll see both prominently listed as leading GSI services for retailers. There is no social networking service listed at all.
Now, we don’t mean to suggest there’s some smoking gun or grand conspiracy afoot here. All we’re saying is that we should all consider the source of these recent reports that seem to fly in the face of everything else we’ve seen with regard to F-commerce and social shopping in general. It’s natural to assume that traditional tools like paid search and email marketing would see a decrease in use and popularity when something new and exciting (in this case, social shopping) bursts onto the scene. But it would appear, at least in this case, that those decreases have become substantial enough that parties such as Forrester and GSI feel the need to unleash information that doesn’t quite jive with what we’ve all come to know—that social shopping IS indeed a relevant e-commerce movement that isn’t going away anytime soon.
As always, we welcome your feedback on this issue so leave us a comment!