How Social Media Can Jumpstart Your Customer Base (and Brand)

According to the Internet Retailer 2015 Digital Marketing Report Series – an examination of the digital marketing strategies among the top 1,000 online retailers – email marketing remains a favored tactic of marketers. The average retailer launches at least four email campaigns each month, and many launch up to 100.

Of course, these retailers have email lists that run into the millions of subscribers, which means even a 2 percent response rate will have a noticeable impact on monthly revenues. It’s no surprise, then, that the top retailers spend a lot of time and resources driving consumers to subscribe to their email newsletters. Many even hire consultants to help them identify every opportunity in the customer journey to solicit email signups.

But what if you’re a brand that’s new to the market? Or looking for ways to drive more traffic and sales to the e-commerce portion of your business? You probably don’t have a million-plus consumers on your email list that you can rely on to generate sales. It takes a long time (and a lot of hard work) to build a list that size, so what are you supposed to do in the meantime?

For many marketers, social media is the solution. For example, Shop.com, a general merchandise site owned and operated by Market America, Inc. spends up to 60 percent of its annual marketing budget on social media because the company sees it as an excellent way to get great results, fast: “We do a lot on social media because we can instantly connect with shoppers. We don’t need days and hours to hit a really engaged audience with a new offer or campaign when we can be on Facebook or Instagram in five minutes,” explains Peter Gold, chief marketing officer (CMO) of Market America.

More than that, social media marketing can help build a base of followers in less time than other initiatives. For instance, it took Shop.com just a year to build a base of 1.3 million followers on Instagram. And those efforts are paying off in sales. According to the Internet Retailer report, Shop.com’s conversion rate from social media traffic is 14 percent – that’s seven times better than desktop-based sales.

NoMoreRack.com, a flash sale discount retailer, echoes Gold’s observations, and says 35 percent of all its monthly traffic stems from social media.

Another flash-sale site, zulily.com, spends up to 25 percent of its digital marketing budget on social media, even though its long-term goal is to build a robust email list so it can turn new customers into repeat brand enthusiasts.

As Mark Brohan writes in the Internet Retailer report, it wasn’t that long ago that marketers viewed social media as an experiment (many still aren’t quite sure what to do with it). But as we can see from these relatively new retailers to the online space, a smart use of social media can be a great way to play catch-up.

That’s not to say the standard marketing tools of online retailing – email marketing, paid search, search engine marketing – are falling the by wayside. They’re not: they still get the lion’s share of top companies’ marketing budgets. But social media has certainly changed the rules of the game. As Laura Santos, director of digital marketing at Envelopes.com, explains, “Digital marketing is a lot different than it was just a couple of years ago. There’s a lot more we have to think about.”