Is the marketing potential of social media being overhyped?

4/20/11

With over 500 million users, it’s hard for marketers not to see sales potential in Facebook. But is it delivering? According to a recent study by Forrester Research the average click-through rate on Facebook is a mere 1%, with a 2% conversion rate. That’s pretty anemic compared to e-mail marketing which has an 11% click-through rate and a 4% conversion rate. (Woo, 2011)

Facebook argues that the ability for people to like a brand and tell their friends that they do amounts to a giant word-of-mouth campaign. And, findings show that when a friend’s name is on the ad people are 60% more likely to remember it, and four times more likely to purchase.

Several months ago, I hypothesized that the latter might be Facebook’s sweet spot. But, we have yet to see any published results that support this. Until we do, one has to wonder whether advertisers should be paying a bit more attention to their e-mail marketing efforts instead of obsessing over unproven channels.
What do you think?

Woo, S. (2011, April 7) Facebook Won’t Become E-Commerce Force, Analyst Says. blogs.wsj.com Retrieved April 20, 2011, from
http://blogs.wsj.com/digits/2011/04/07/facebook-wont-become-e-commerce-force-analyst-says/