Online Retail: It pays to be talked about on Facebook

 @ibtimes on April 08 2011 3:36 AM

Online retailers across segments are reporting a surge in sales every time a customer 'likes' their page or a product on Facebook, or posts a feed about a purchase on their portals. 

The social media giant released concrete figures, quantifying the Facebook effect on retailers, according to a New York Times report. Citing the Ticketmaster example, Facebook said that every time a user posted a feed that he had purchased a ticket on the site, it generated an additional $5.30 in ticket sales.

However, while one can intuitively accept people going along for an event when they find out friends are going to be there too, the effect surprisingly is not restricted to retailers in this particular segment. According to statistics shared in the NYT report, even clothing retailer American Eagle found that users guided by friends' recommendations on Facebook spent 57 per cent more than the average on its site. (Whatever happened to uniqueness in Fashion?) Another retail portal that sells outdoor gear saw a doubling of sales within a week of adding a like button on its Facebook page.

At an event in Texas, Facebook's vice president of partnerships and platform marketing Dan Rose is reported to have emphasized the tremendous power of word of mouth on the site and in particular, its social ads which inform people about what a friend likes or buys on the site; Rose said that when a user spots a friend's name in an ad, he is 60% more likely to remember the ad, and four times more likely to purchase the product.

The trends thus highlighted seem to add greater credibility to a recent report from consulting firm Booz & Co., which estimated that social commerce sales - purchases made on a social network platform rather than on the retailer's site - could reach $30 billion worldwide by 2015. 

 

 

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