Practical Ecommerce

3 Ways Social Media Affects Brands

The continued growth of social networking and blog sites is having an effect on brands and how those brands are marketed.

According to an October study from The Nielsen Company and its social media affiliate, NM Incite, “60 percent of consumers researching products though multiple online sources learned about a specific brand or retailer through social networking sites” in the third quarter of 2011. What’s more, social networking sites — like Facebook or Google+ — and blogs reach some 80 percent of American Internet users.

The volume of social media consumption and participation and — to some extent — the very nature of the media means that many brand name products or stores are the topic of discussion on Facebook, Twitter, LinkedIn, Google+, or any number of blogs. These brand conversations impact companies in at least three ways.

Product Ratings and Reviews

Product reviews and ratings have changed in the social media era. Not too many years ago, producing ratings and reviews were almost completely in the publishing realm — think of magazines like Consumer Reports or online sites like CNET.

These publishers still do product reviews, of course, but now so do social media users. According to the Nielsen and NM Incite report, three out of five active social media users create product reviews or otherwise rate products. When asked to name the kinds of product or service information they liked best, 63 percent of the respondents said consumer ratings and 62 percent chose consumer reviews.

It is worth noting that in social media, product reviews do not have to be stored on a retailer’s website. One of the earliest examples of social product reviews came a few years ago, when several videos began to circulate on YouTube showing how to open a Kryptonite-brand bicycle lock with a Bic pen. The videos caused Kryptonite, which had been a leader in bike locks for more than three decades, to redesign its product.

Given this level of participation and preference it should be clear that social-driven ratings and reviews affect brand.

Customer Experiences Become Public

I’m aware of a shopper who recently tried to return a pair of logging boots to a retailer. The boots had been worn for nearly three months. They were scuffed, scratched, and torn. When the retailer offered to refund half of the purchase price instead of returning every penny, the shopper threatened to post to Facebook about his bad experience.

Similarly, a shopper recently posted on the same retailer’s Facebook page about how helpful the company had been during a recent shopping experience.

In social media, many, if not most, brand conversations are driven by a customer experience. Some 61 percent of active social media users post about products or services to recognize a job well done, but 58 percent post to “protect others from bad experiences,” according to Nielsen and NM Incite. What’s more, a full 25 percent are vindictive when they write about brand-related experiences.

This sort of customer behavior can certainly impact a brand’s reputation.

Constant Innovation

Social media and blogging have also affected how brands market. To generalize, many of the best recognized consumer and retail brands were built using a Madison Avenue formula that included generating a well defined brand message and trumpeting that message via mass market advertising.

While a good brand campaign will still include this approach, the modern marketer must also seek to engage customers on Facebook, Twitter, Tumblr, Google+, LinkedIn, FourSquare or any number of other social media or blogging platforms.

The need to engage has increased the marketing noise, if you will, on social networks to the point that marketers, who in the past could rely on a formula to build brand, must now innovate constantly, creating engaging content for social media users to interact with and consume.

Summing Up

Social media’s popularity and use has impacted brand marketing in at least three ways, as more consumers review products, relate customer experiences, and interact with brands.

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Armando Roggio
Armando Roggio
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Comment ( 1 )

  1. NathalieGaveau December 6, 2011 Reply

    Armando,

    This is a great look at the impact of social media on brand marketing today. I personally believe this transformation is very positive for brands and their customers, particularly, in driving constant innovation. For instance, in addition to providing transparency and opportunities for customers to share feedback and reviews, brands are also taking greater advantage of social shopping to provide word-of-mouth awareness. By enabling consumers to discover and share their products on social networks and apps such as ours, brands are creating opportunities for consumers to both advertise and advocate for them. It’s exciting to be a part of this transformation, and I look forward to more great social media-driven branding innovations to come.

    Nathalie Gaveau.
    Founder and CEO.
    Shopcade.com.

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