Increase your profit margin through social media

Increase your profit margin through social media

pHandsAndBusinessGraphGlobe_11120505_sSocial media is a vital resource for increasing profit margins. As technology becomes a more and more important part of daily life, it influences people’s purchasing habits and the ways they share information. Smart businesses use social media to stay in touch with their customers and build a wider consumer base, as every Illinois business attorney is aware.

A recent study published in the International Journal of Marketing, Financial Services and Management Research shows that social media can be a highly profitable marketing strategy for businesses of all kinds. The study reveals that consumers use social media to make informed choices and spread positive word of mouth about brands they respect.

Key findings of the new study

The marketing study, published in November 2012, contacted a group of consumers who use social networking sites and asked them about their use of social media in purchasing decisions. 78 percent of these consumers always or almost always use social networks when they make decisions about a possible purchase. The remaining 22 percent of consumers occasionally or rarely use social media to make buying choices. None of the people in the survey reported never using social media to make purchasing decisions.

The implications of this study are clear for successful business marketing. A full 100 percent of people who currently use social media also make some use of social networking to choose the products and services they will consume.

Why do consumers choose to follow a brand?

According to the study, people choose to join a brand’s social media page or follow a brand on social media for four main reasons:

  • Advertising or active invitation by the business (68 percent of customers)
  • Invitation by a friend (52 percent of customers)
  • Existing brand loyalty (44 percent of customers)
  • Individual research (32 percent of customers)

In many cases, a customer follows a brand for more than one reason. Active social media advertising is the most effective of all these strategies. Once the business has created interest in the brand, peer-to-peer invitations and brand loyalty will follow naturally. Satisfied customers will become online brand ambassadors in their own right, as an Illinois business attorney knows.

Businesses can profit from social media

This new study shows that businesses can profit from social media by maintaining a strong presence and remaining aware of their potential impact on social media users. With more than two-thirds of users reporting a strong direct response to advertising or invitation, the time is ripe for a smart social media strategy. Companies may find it useful to speak with an Illinois business attorney about their options.

 

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