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Rethinking Social Media Marketing

A Snarketing post by Ron Shevlin, Director of Research at Cornerstone Advisors

Gallup released the results of a consumer survey which found (as reported on the Harvard Business Review blog):

“62% of U.S. adults who use social media say that these sites have absolutely no influence on their purchasing decisions. Another 30% say these sites have some influence, and just 5% say they have a great deal of influence. Of consumers who report liking or following a company, 34% still say that social media have no influence on their purchasing behavior, while 53% say they have only some influence. These findings raise a question: is there an inherent flaw in the idea of using social media to drive purchasing, or have companies just been using social media poorly?”

These findings raise more questions, one of them being: An an influencer, how does social media compare to other channels?

Gallup’s research has found that “consumers are much more likely to turn to friends, family members, and experts when seeking advice about companies, brands, products, or services.” But that doesn’t tell us anything about how other marketing channels influence consumers’ purchase decisions. Six in ten consumers may say that social media has no influence on their purchasing decisions but how does that compare to TV or banner advertising, or to direct mail? I suspect that even fewer consumers might say those forms of communication have a great degree of influence on their purchasing decisions.


This, however, raises another question left unanswered by the Gallup study: Should we trust consumers’ self-determination of what influenced their purchase decisions?

There have been a number of studies conducted (look at SSRN for examples) that have attempted to prove that advertising has more of an influence on consumers’ decisions than consumers may be willing to admit.

One of the things that drives me nuts about studies like Gallup’s is that it asks consumers how influential something is on their “purchase decisions” as if all decisions are influenced by the same things, and to the same degree.


The HBR article, after wisely raising the question about the potential inherent flaw in the idea of using social media to drive purchasing, takes a wrong turn, and drives the article straight off the cliff. What did it do? It got prescriptive.

Here are Gallup’s prescriptions to “positively influence purchasing through social media” and my take on them. Gallup advises social media-using marketers to be:

Authentic. Gallup says that consumers are “more likely to listen and respond to companies that seem genuine and personable” and that “companies should back away from the hard sell and focus on creating more of an open dialogue with consumers.”

My take: What, exactly, is an “open dialogue”? How is this different from what companies are already doing on social media? How would I, as a social media-using marketer know if I’m really creating an open dialogue or not? What impact on sales, and on customer relationships, would focusing on “creating an open dialogue” have? And, anyway, is there any proof that the majority of companies using social media focus on the “hard sell”? Consultants should be administered mild, but uncomfortable electric shocks when making nebulous recommendations like “be authentic.”

Responsive. Gallup says “companies must be available to answer questions and reply to complaints and criticisms” and to “actively listen to what their customers are saying and respond accordingly.”

My take: No argument here (other than the minor quibble that nobody should have to recommend that companies “actively” listen, as if passive listening were a viable alternative). But Gallup is now confusing things. Using social media as a customer service or support tool has a lot of merits. But the recommendation to “be responsive” is in the context of positively influencing.” Sure, you could argue that a positive customer support interaction has a positive impact on future purchase intention, but that would be true of any channel the support interaction occurs in, and not just social media.

Compelling. Gallup says that “companies must create compelling, interesting content that appeals to busy, picky social media users” and the content should be “original to the company and not related to sales or marketing.”

My take: Brilliant! Why didn’t I think of creating and providing “compelling, interesting content”? Here I’ve been, creating dull and boring content for lazy, apathetic social media users! Stupid me! Forget for a moment that this is a useless recommendation. The real crime here is that how can you provide a recommendation on how to use social media to positively influence purchasing if you don’t know what how consumers’ preferences and intentions are established? In other words, is there any proof that compelling content–if we could really measure “compellingness”–positively influences purchase intention? Show me the proof and I’ll accept it. Show me how to distinguish “compelling” from “not compelling” and I’ll tell the world what a genius you are.


Bottom line: It’s time to re-think social media marketing.

If the tone of the Gallup study is correct–that social media marketing isn’t having a strong influence on consumers’ purchase decision–then maybe the correct response is to re-think the goals and objectives of social media marketing.

Maybe the purpose of social media marketing is something else besides influencing purchase decisions and intentions.

If we take a customer lifecycle approach and break down marketing activities to…


….then maybe we have to admit that social media marketing isn’t as good (i.e., effective) as mass media advertising, or particularly good at driving consideration or preference. Maybe the best application of social media marketing is for driving engagement.

If that’s true, then recommendations like “be authentic” and “provide compelling content” aren’t wrong, they’re just useless. What we would need, then, is better understanding of exactly what “authentic” and “compelling” is and isn’t. But that would be in the context of how those concepts drive engagement–not purchase intention.

Ron ShevlinRon Shevlin is Director of Research at Cornerstone Advisors. Get a copy of his best-selling book, Smarter Bank: Why Money Management is More Important Than Money Movement. And don't forget to follow him on Twitter at @rshevlin.

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  1. Also, the data is from December 2012-January 2013. In a real-time data world, it’s like looking back through time and space.

  2. Great information, and as always, great thought leadership. We look forward to hearing you speak as the Annual Meeting keynote at the Maine Credit Union League convention this Friday in Portland!

  3. The problem isn’t the channel, but the message. The problem is that the message does not correlate with the reality (eg the classic marketing vs delivery bait & switch).

    My bet is that a review of the last 50 marketing messages by any Bank or Credit Union will highlight the fact that the vast majority offered zero tangible value to the consumer. My bet is that most consumers who did tune into the message probably ‘hung up’ upon discovering said bait & switch.

    Why are we surprised that consumers are disconnected from Banks? What is it about ‘Bank A’ that makes it so much more attractive than working with any of the other 15,000 Banks and Credit Unions in the country? … not to mention the hundreds of non-bank providers?

  4. Gavin: Thanks for commenting. Is it your contention, then, that if the survey were conducted today, we’d see radically different results?

    If you think so, then it would imply that the answer to Gallup’s question is that companies were just using social media poorly. That, in term, would make me ask: What exactly have companies been doing that differently in the past 18 months to drive a complete turnaround in consumers’ perceptions of how SM has influenced their purchase decisions.

    Not only am I skeptical that we’d see radically different results if Gallup re-surveyed consumers today, there’s little evidence on the supply side of the equation (i.e., companies) that show how SM marketing has produced big gains in driving purchase influence. But I’m certainly open to hearing examples of this (especially if they talk to how a company has SYSTEMICALLY used SM as a purchase-driving tool, and not just as a one-off example).

  5. Hey Ron,

    Hope you’re doing well! I agree with most of your thoughts, but I think that the biggest problem is that financials do not have plans in place to make social profitable. Will social ever be a FI’s biggest revenue generator? No. I believe there are benefits to the soft returns that social media gurus have been toting for several years now, but nothing will ever compare to actual dollars coming in the door.

    Since the beginning of the year, we have been working with several credit unions to help them actually justify the time (money) they spend on social channels and we’ve had some pretty remarkable results. As you know, I split my time and efforts between my credit union (CitizensFirst) and CUSO (Chatter Yak!). As we are now almost a full 6 months into the year, we have generated just under $500K in consumer loans from Facebook exclusively.

    People will ask how we did this and they answer is simple: We made a plan. We set a goal and we are executing.

    I believe Serge has some great points in his comment as well. Social messaging should be all about providing value. As far as I can see it, there are only a few things of value that you can do on social platforms.
    1. Provide useful information (keyword is useful and not self-serving)
    2. Provide a positive emotional reaction (a laugh, inspiration, etc.)
    3. Provide a tangible item (sweepstakes and giveaways)

    The last thing of value a FI can do is provide a product or service that is of value because it saves a person money or stress. The problem here is that it’s a complex sell. If you can help members/customers understand how you will provide them value, they will appreciate it and only then can you even think about selling a product or service.

  6. After saying HBR got prescriptive, you’ve attributed the prescriptions in the following paragraph to Gallup. Wrong turn or am I missing something?:) Now, moving on from housekeeping matters: (1) To a marketer, there’s a huge difference between organic content vs ads on social media. It’d help if Gallup and / or HBR clarified if they meant both or which one of the two when they say social media marketing. Until they do that, to someone who is wont to split hairs, the potential response “social media both both organic and ads, unless noted otherwise” won’t work (2) Over 90% of Google’s revenues come from one single product, namely, Adwords. However, in the 7+ years that I’ve been exposed to Google Ads, I haven’t come across a single soul who admitted to clicking a Google Ad, let alone go all the way thru’ to making a purchase. If no one really clicked Google Ads, Google wouldn’t be around, let alone flourish. Speaks volumes for how much people are willing to admit to the influence of ads in their purchasing decision.

  7. 1) You’re mincing words. I wrote “The HBR article….takes a wrong turn…”
    2) Great point about organic content vs. SM ads. My reading of the article–and enforced by the nature of the recommendations–leads me to think they’re talking about organic content.
    3) I’ve clicked on Google ads. I do it from time to time because I want to make the advertising company have to pay.

  8. 1) Got it.
    2) In that case, FB might actually use this study to support its own moves to reduce the reach of organic content and nudge marketers to spend their $ on FB Ads!
    3) So do I! When such clicks cross a limit set by and known only to Google, they’re supposed to be deemed as Click Fraud and money refunded to advertisers.

  9. The commentary on Gallup’s “recommendations” is brilliant. I’m so tired of trite recommendations in the social media space.

    As for the survey itself, it’s just inherently flawed to ask people what influences them. Read Daniel Ariely’s “Predictably Irrational” and you’ll never trust another behavioral survey again. You have to TEST the behavioral response, not ask for it.

    I’m a perfect example. I would answer a survey that I’m never influenced by social media. Yet just yesterday I was looking for a restaurant to meet with a friend. I saw a sushi place I hadn’t heard of on Google Maps with 22 reviews and a 4.8 rating (of 5). So I went with it. Crap–I was actually influenced. But this was a low risk, low gain decision which is where social media is probably best. Not the same if I’m looking for a car, an apartment or other high risk, high gain decisions.

  10. Thanks for your comments, Donald. Another problem with a lot of the research (and I hate to admit this, but my own is probably guilty of this, as well), is that it asks “what influences your decisions” generically. We make how many purchasing decisions on a monthly basis? Hundreds? How many of those decisions are automatic, rote purchases (I don’t know, soap, paper towels, etc.) where the “influencer’s” influence occurred months or years ago? We (us researchers) need to get a lot more granular in trying to assess what influences consumers’ decisions.

  11. We need to stop asking people questions we know they don’t know the answer to. We have to begin the (very) hard work of actually observing behavior instead. We have to design tests, run experiments, collect the data, etc. It’s not often done because it’s hard, it’s expensive and often we don’t want to mess with real transactions in the real world. So we run surveys. If we like the results, we publish; if we don’t, then we either throw it away or explain it away with the very same concerns that we should be placing on the results we like. There’s a HUGE confirmation bias in this space.

  12. I think the fact that the demographic of “social media users” include their friends and family is where the “sweet spot” of social media marketing lies. To me, the best strategy to consistently add value to the lives of those who you want to interact with your brand. Ultimately the desired outcome is to be a familiar, valuable, and trusted “voice.” To me social media is like being a really helpful and humble person who is exponentially magnified to the right people for the right reasons. Thanks for engaging me. I actually did the call to action of leaving a reply! Rare!

  13. Thanks for commenting, Mary.

  14. My favorite line in the report is: “consumers are much more likely to turn to friends, family members, and experts when seeking advice about companies, brands, products, or services.” That is social media! Where does Gartner think this “turning to” is going to happen — are consumers going to write letters? We might make a few phone calls but increasingly it occurs on unrelated sites, blogs and World of Warcraft forums (a great place to read tech discussions). Gartner is looking at Social Media through a pin hole camera and declaring that everything is blurry.

  15. Gartner = Gallup. hard to tell the difference sometimes

  16. 🙂 Happy to edit your original comment and make the change if you want.

    And when they say “consumers are much more likely to turn to friends, family members, and experts when seeking advice about companies, brands, products, or services” I can’t help but wonder, WHO ELSE CAN THEY TURN TO? THE COMPANIES THEMSELVES? No one is that crazy.

    Or maybe they are. Because isn’t that what the whole content marketing movement is about? Creating content that provides information and advice on products/services, and how to choose between them? Is no one else seeing the inherent contradiction here?

  17. Information on products/services and how to choose is the opposite of content marketing. That’s just marketing. Content marketing, at least how we use the term with our clients, is providing information that the end user is interested in. Usually that’s how to solve a problem or be aware of a risk. The point is to build trust. I know Adobe only wants to sell me more applications but when they spend time showing me how be successful in business with no promotion attached, I start to trust them. At least as a source of valuable knowledge. If they do that 80% of the time and then ask to sell to me 20% of the time, I’m ok with that. A good trade. When was the last time you thought of a pop-up ad as a good trade?

  18. Ron I need to take you to task on the be authentic piece. I guess,because you’ve never done a none authentic blog it’s hard to imagine a marketer would push stale, corporate bullshit at the masses and understand the consequences… But it’s definitely still an epidemic.
    ut to I prefer an idea Ive been toying with for a few years called SHOP. SImplify, Humanise,Open Dialogue and Personalise.

    Simplify – Say it in less words, less jargon and cut to the why motivator of a product.

    Humanise – Have some personality – Brands are trying this and sometimes it goes spectacularly wrong (like the recent KLM world cup tweet). First Direct in the UK are the masters of this. It turns out people like vulnerability or apologies if its attributed to a genuine person, rather than a stage managed statement. This doesn’t work as well for the very top of an organisation or politicians… yet.

    Open – Admit fault, commit to transparency, get your own don’t be evil. Banks need that, desperately.

    Personalise. Greet someone by name, know about their wants and needs (using data or a human) and empathise.

    How many banks have really embraced that?

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