It seems like the word “social media” is thrown around quite liberally just about everywhere. When certain words get repeated enough times and it can be twisted to mean something else. However, reason the word is used so much is simple, its because SOCIAL MEDIA IS BIG. Case in point, the whole KONY 2012 movement that spread virally through the inter webs to reach millions around the world just in the matter of days. Regardless of the actual mission of the movement or the “shady” manner of handling of the organization’s financial dealings, one thing is crystal clear. And the message is that, if you can offer something (that something can be product, service or anything else) that will get people excited and involve them emotionally, people will tell other people about it. For businesses this is a great opportunity to have your customer do the marketing for you.
With that being said, Angela Bandlow who is the Vice President Marketing, Extole, a C2C social marketing company that creates social referral programs says that you can actually measure this amplification effect these referral programs have on eCommerce metrics like click through rate and conversion.
According to her, social referral programs allow companies to tap into their customer advocates to promote their brands, products and services by getting those customers to share within their social networks. These programs then track the shares through to the conversion, whether that is a sale, an opt-in or a coupon redemption.
Extole recently conducted research on 20% of its customer base with an average data collection length of 45 weeks, and this research uncovered some interesting data points on social sharing among different companies.
Measuring referral programs are little bit different than conventional marketing program.
She offers a few areas to track with referral programs:
- How many of your customers are participating in your program? These people are called “advocates” at Extole.
- Of the people participating, how many people do they share with, and through what marketing channel — email, Facebook, Twitter, personal URL (PURL), etc. This metric is important because it shows the “amplification” of the message or call-to-action.
- The number of social shares is the multiplication of the number of participants and the amount of sharing.
- Clicks-per-share, or in other words, the rate of clicking with the social shares from your customers.
“You see a different rate of amplification across social channels versus email,” says Angela. “Email is always going to be a one-to-one share.”
Extole’s research found in aggregate its clients get 3.49 shares per advocate. In other words, everyone participating in a referral program is sharing with almost three and a half friends. On the high end, some advocates share with as many as 12 friends.
Here is a breakdown of some of the data points across several channels:
- The largest percentage of advocate sharing is through email, and those shares get a 21% open rate, 80% clickthrough and 17% conversion (the highest conversion rate of any channel), which breaks down to .17 clicks per share.
- Facebook shares average 1.24 clicks per share, but the conversion rate is only 1.21%.
- Twitter actually averages 6.81 clicks per share, which creates the highest amplification rate of any channel.
This research also found an overall average of 42% clickthrough rate through social referral programs and almost five friend clicks per share for highly performing programs.