The process of making purchase decisions
You’ve all been told you need to be using social media and some have even pitched to you that it is the end all be all, and although we wildly disagree and remind people it’s simply a communication channel people are coming to expect you to be on (much like when telephones were introduced, people slowly adjusted as did business). But does social media have enough of an influence over purchase decisions (like hiring a Realtor or where to buy) to demand your presence?
Online research company Knowledge Networks studied the purchase decisions of Americans and found that the likelihood of a consumer to discover new products or brands is rising rapidly with 38 million 13 to 80 year olds now influenced by social media, up 14% from just six months ago.
Millions referring to social media before purchasing
People who reported being social media users in 2011 reported high levels of influence as follows:
- 23.1 million discover new brands or products through social media (up 22% from 2010)
- 22.5 million use social media to learn about unfamiliar brands or products (up 9% from 2010)
- 17.8 million are “strongly influenced” in their purchase decisions by opinions in social media (up 19% from 2010)
- 15.1 million refer to social media before making purchase decisions (up 29% from 2010)
- Roughly 80 million people check social media from a mobile device
Consumers are now integrating social media as a part of their phone use with 40% of teens and adults who have ever used social media accessing it through their mobile device (up 28% from just 6 months ago). Location based services are rapidly increasing in size and popularity with Foursquare alone celebrating crossing the 10 million user mark. Mobile devices are playing an increasing role in purchase decisions as well with 27% of users comparing or checking prices via social media and 24% regularly checking reviews of locations, brands and services.
“Tying consumer interactions back to brands and purchase decisions is essential for marketers, in social media no less than any other platform,” said Patricia Graham, Chief Strategy Officer of Knowledge Networks. “While we have seen a dramatic rise in key metrics that quantify Social Media’s influence, we also have observed a wide variation of influence at the category level.”
“The on-the-go consumer is becoming more mobile in their social media usage,” said Chuck Martin, Director of the Center for Media Research at MediaPost Communications. “This move to mobility combined with the increasing influence of social media during the purchase process has great implications for marketers, who will have to look at location as well as which product purchases are most affected.”
Purchase decisions and you
Realtors, how does this influence your career? It’s much less about an actual house than it is two things- you and neighborhoods. Consumers are now using the web and their phones to research you, ask their friends for referrals, read reviews about you and read your blog long before they reach out to you and what their friends say influences whether or not you get hired. Consumers are also asking their networks about neighborhoods they’re considering and reading up on the area via review sites and the like before they make a purchase.
What this means to you is that you should first be armed with the same knowledge they are and be sure you’re aware of sites like Yelp and review sites. Secondly, it means your presence in social media be it Facebook, Twitter, LinkedIn or elsewhere, improves your chances of a referral because if there is nothing for them to read about you, they don’t feel like they’ve done any research. Consumers are buying your services and they’re buying a neighborhood, and if neither exist online or no one in their network knows of it, the chances of the sale narrow. We anticipate this trend of consumers influencing each other via social media will continue to grow rapidly.
Doug Francis
June 23, 2011 at 8:40 am
Being found online is essential, but it needs to be more than snarky comments on Yelp or the fact you are the "foursquare mayor" of New China King Restaurant!
I believe that having an online "presence" is different than pure "social media". Maybe someone else can draw the line here because I feel there is a subtle yet distinct difference between pure SM platforms like Facebook, Twitter, foursquare or Yelp, and my real estate blog.
My blog is intended to be a content marketing site where consumers get to know more about buying or selling homes in Northern Virginia including my candid, sometimes quirky insight into the local real estate market. I like it because I enjoy writing, being creative, using photography and WordPress.
The pure social media concept seems distinctly different. For example, instant discounts when you "check-in" allows your coffee shop an opportunity to track their best customers. I don't think home buyers expect that type of response since buying a home is slightly more expensive and involved. My experience with Facebook is to "un-like" or hide real estate "friends" who spam me with homes they have listed.
Social media involves walking a fine line. Oh, and watch those snarky comments!
Lani Rosales
June 23, 2011 at 10:28 am
Doug, you're right but think of it this way- saying "print marketing influences 23% of all buyers" (a completely made up number) would have you scratching your head saying, "okay, well is that direct mailer, news print, flyers, magazines, or what?" but the point would remain that print influenced 23% of buyers. There is a distinct difference in every channel on and offline, but the sum total is rising in influence and quality is <em>finally</em> trumping quantity, so you're right, a single check in has far less of a potential impact as an entire blog with relevant content.
Joe Loomer
June 23, 2011 at 10:36 am
and you can link that blog to several social media accounts and grow your audienc.
Joe Loomer
June 23, 2011 at 10:34 am
What I find the best about social media is the ability to share (link) information via so many separate venues. Cross-pollinating and getting your name in front of an extremely large and diverse group. I try to limit my business talk to relevant issues for any consumer, and use a business page to post real estate information (which I can then share on my own news feed and still get the exposure I want).
When I received my first Facebook lead in March of 2008 it took my breath away because I had only started my social media strategy as the result of a Ben Kinney presentation that February. Now if I don't get at least two a week, I revisit my strategy and try something new. LinkedIn has also been an amazing source, and the ability to post updates there that automatically link to your Twitter account is a plus.
Navy Chief, Navy Pride