Abstract
Given the rapid proliferation of digital technology, social media has become a key digital marketing strategy to promote business products, with the ultimate aim of maximising profits. Yet, empirical evidence on the impact of social media as a marketing tool remains underexplored. Using unique data over a 12-month period from a major online retailer, this paper examines the impact of daily social media activity on daily business outcomes: website traffic, orders and sales. Key findings reveal that social media leads to increased web traffic, but it does not produce a significant rise in product orders and sale income. Though, larger social media campaigns tend to result in significantly higher number of orders and sale income, and Facebook emerges as the most effective channel. Our results also reveal that the effectiveness of social media marketing varies across products depending on their complexity, cost and brand status. Taken together, these results offer a better understanding of the ways social media marketing impact businesses and provide intelligence on how to allocate resources to develop marketing campaigns.
1. Introduction
In the past decade, the way consumer goods are marketed and sold has been markedly altered with various technological factors primarily driving the change. In November 2018, online sales reached 20% of total sales for the first time in the UK (ONS, 2018). Retailers are constantly searching for new and innovative ways to reach new customers and improve the consumer experience. An increasingly popular approach involves the use of social media to communicate with customers, endorse brands and promote products through digital marketing campaigns and online (e) word-of-mouth (Grewal et al., 2017).
7. Conclusion
The growing proliferation of social media networking sites has led to an increase in the use social media platforms as marketing tool to augment consumer reach with the hopes to foster business outcomes. Yet, limited empirical evidence exists as to how social media impact these outcomes. Previous research has typically employed qualitative methods or publicly available data from APIs to estimate effects of various social media campaigns. Drawing on unprecedented access to a large retail company database, we analysed the impacts of social media marketing campaigns on business outcomes: web traffic, product orders and income sales. The findings from this analysis are set to benefit both the company and wider research community, as it provides the first to our knowledge robust quantitative analysis which specifically assesses the effects of social media marketing strategies on business outcomes.
