Consumer Psychology for a Digital Age

A Look Inside Retailer Deals [infographic]

So you want to sell smart with social media, then sell with a deal.

Why?

A deal mindset is key in social commerce because much of the value of selling with social media comes from the word of mouth effect, the referral impact of shared activity and comments – and people talk about deals.

In fact research conducted by my colleague Paul Marsden shows that over two-thirds of all word of mouth activity comes from a difference between expectations and experience, call it the ‘surprise effect’ – so if you want to make people share, then you have to beat their expectations.  And how do you do that?  Beating their expectations on value is smart because “value maximisation” is the central MO – modus operandi – of consumer behaviour.

Therefore, it follows that offering deals is the most powerful tools in the social commerce armoury.  Want to sell with social media, then offer a deal.  Deals make shopping ‘beddable and spreadable’ – attractive and viral;  turn shopping into remarkable event.

So with that in mind, you may want to know what kind of deals you’ll most likely find on a particular retailer’s website. Curious where exactly these deals can be found? This infographic from behavioral commerce company Steelhouse reveals that information.

As might be expected, for the most part retailers offer deals on free shipping (34%) and discount offers (25%). From a social commerce perspective, Groupon-style daily deals and flash sales rank third (21%).

In regards to traffic driven to a site from social media, Steelhouse data shows that only 1-7% of all monthly visitors come from social websites. Conversion rates are equally low, averaging at around 3%.
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Today’s article is sponsored by Milyoni: The Leader in Social Entertainment

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Comments (5):

  1. Gideon Lask

    May 3, 2012 at 12:56

    Steelhouse has put together some really interesting research here. Deals are definitely one of the cornerstones for social commerce but not enough retailers are looking at social media intelligently. The research proves that, with the low traffic and conversion rates coming from social media sites – a clear indicator that retailers aren’t taking advantage of social commerce properly.

    I think you’re absolutely right that deals turn shopping into events – it’s a great way to get people talking and sharing, and they can be a reward for loyal brand advocates. That’s exactly why we’ve developed the co-buying model at BuyaPowa. We’ve created a new way to not only reward people for liking a brand, but to encourage them to become true advocates and spread the message themselves – this carries a lot more weight than a few posts on a branded Facebook page.

    With co-buying we’re seeing big traffic generated through social media – 12% of co-buyers tell over 100 people about the deal generating significant buzz, and each one generates and average of 500 positive tweets. This means co-buyers are talking and recommending the product to their community, influencing future purchasers with credible and transparent advocacy. We think it’s a much better way to nurture brand loyalty than something like free shipping, which is easily copied and frankly, something a lot of consumers have already come to expect.

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