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The growing popularity of Twitter has led thousands of businesses to launch profiles, and there is no surer way for a company to be seen as ‘not getting it’ as to not be tweeting.

In March the UK’s Daily Telegraph reported that 700,000 businesses in the UK had active accounts. and across the blogosphere and in company boardrooms the platform is being breathlessly talked up as the future of online customer communication.

But, hyperbole aside, how well does Twitter work as a channel for reaching customers and generating sales? 

Is Twitter driving sales? 

With one or two exceptions (most notably Dell, which has claimed several million dollars in revenue from Twitter), few businesses have used Twitter to drive significant sales. Studying the Twitter profiles of some major UK online retailers and analysing available data suggests that, as far as business is concerned,Twitter is yet to live up to its hype.  

The ‘wrong kind’ of followers, low follower numbers and a general disinterest in e-commerce sites on Twitter has meant that so far Twitter is far from proven as an effective tool for business.

The ‘wrong kind’ of followers

Examination of the Twitter followers of some of the big consumer facing businesses in the UK (Marks and Spencer, Debenhams, Carphone Warehouse), shows that 20 to 30% of their followers are not consumers, but either other businesses, or spammers. 

In addition, an estimated 60% of users quit in the first month. A large proportion of people following most businesses in Twitter are therefore the wrong sort of the 10 main types of Twitter user and overall, it is safe to say that the majority of people following businesses aren’t that interested.

Not enough followers

Although some businesses such as Topshop and ASOS have tens of thousands of followers, many household names with a presence on Twitter have a tiny number of followers given the size of their customer base. For example:

Given that the majority of these followers are probably not ‘following’ in any meaningful sense it can only be concluded that these Twitter presences must be driving a negligible amount of traffic and sales to the websites in question and barely advancing customer engagement. 

It could be argued that these low figures are in part due to a lack of promotion on behalf of the above as, for example, none of them advertise their Twitter profile on their homepage. Whilst this half-heartedness may be undeniable, the lack of followers is also probably symptomatic of a more general lack of interest of consumers in following businesses on Twitter.

Tweeters don’t visit e-commerce and business sites

Statistics from Hitwise shows that Twitter sends 55% of its traffic to other content driven media sites, such as social media, blogs, news and entertainment websites with only 9.5% going to transactional websites. 

As there is no shortage of businesses on Twitter then either Tweeters are not interested following businesses or they are reluctant to click on commerce Tweets. By contrast, Google sends 30.7% to transactional sites and Facebook 14.7%. During May 2009 Google sent 365 times more traffic to transactional sites than Twitter.

Implications for businesses and Twitter

As businesses flock to the platform, Twitter is in danger of becoming like a bad networking event, full of sellers but few buyers. Thousands of businesses are broadcasting their news but scarce, often of poor quality followers means that few people are listening. Twitter may be where a lot of current and potential customers are, but on the whole they don’t come to Twitter to interact with businesses.

The implications of this state of affairs are serious for both businesses and Twitter. If Twitter is not working for the majority of business account holders, then the platform will have difficulties with any future plans to charge businesses for a presence on the platform. 

Businesses need to see through the hype and consider the resources which they devote to Twitter with regards to other marketing channels. Tried and tested marketing techniques such as search engine optimisation, whilst much less sexy, have the potential to drive many times more traffic and sales than Twitter.  

Trevor Ginn

Published 12 March, 2010 by Trevor Ginn

Trevor Ginn runs the online baby and nursery retailer Hello Baby and blogs at www.trevorginn.com.  You can follow him on Twitter

3 more posts from this author

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Rory Dixon

Whilst you want as many followers as possible, the kinds of conversations that you have with your followers - regardless of number - is just as important, if not more so.  We use Twitter in our business to offer advice and support around our business area.  These have often led to conversions that occur offline, although one of the challenges that we are facing at the moment is tracking these.  Whilst it is not one of our top conversion tools, it does present one of the lowest CPA channels (in conjunction with our other social media activities e.g. forums, blog articles).

over 6 years ago

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Claire Hampshire

In terms of driving sales, I find it more effective to target individuals looking to buy rather than posting generic promotional posts. Setting up Twitter searches on Tweetdeck or using a social media monitoring tool allows businesses to directly target individuals expressing a particular need who are therefore more likely to convert. We (Appliances Online) also use Twitter for reputation management & connecting with existing customers as well as keeping an eye on what is being said about our competitors. This is a far more effective use of social networking, and will give a much higher ROI than simply measuring direct revenue.

over 6 years ago

Sean Clark

Sean Clark, Head of Web Operations at Adnams Plc

You really do have to look at this on a case by case basis. Retailers who are poor communicators on Twitter always talking about offers and promotions will appeal to a minority. Whilst for some retailers it is a way for them to offer that personal touch, especially large retailer brands which are often seen as disconnected from the consumer. Asda are fantastic UK example of a retailer offering a personal touch through Twitter. Also, if you expect to measure Twitter like you would an Adwords campaign you are going to be disappointed. But if it acts as part of your overall marketing strategy, you are open, honest and are seen as the expert in your field, it can make your retail outlet the place to go, on or off-line. "...full of sellers but few buyers" You should not forget though that the guy following you looking for an opportunity to sell you the latest e-commerce platform is also a consumer therefore potential customer. "Businesses need to see through the hype and consider the resources which they devote to Twitter with regards to other marketing channels." - Agreed resource allocation should always be a consideration, as should ensuring you enable your customers to contact you through the method that best suits them. Really Twitter like your email inbox just needs managing and unless you have huge amounts of Followers, and therefore potential, in the first place resource should not really be an issue.

over 6 years ago

Marty Hayes

Marty Hayes, Digital Director at Venture Stream

I ran my employers Twitter account when I worked for an online ethical store last year, and found Twitter to be of great value and use to the business. When I took over the account, they had less than 50 followers. Six months later this was up to over 3000.

This was down to a combination of carefully following active Twitterers with a genuine interest and passion for what the business was doing/selling. This included keyword monitoring via TweetDeck for terms such as 'vegan', 'fairtrade', 'organic', etc. As well as this, I posted various types of Tweet's on the company's behalf.

There was, of course, the Marketing tweets (special offers, new products etc.), but also Tweeting fresh and relevant UGC (customer product reviews, customer blog comments, staff blogs etc.), and general updates from the ethical arena. I interacted with our followers and engaged them in our conversations and got involved in theirs. Traffic to the blog and to high value product pages undoubtedly increased, as well as customer awareness and engagement.

I found that Twitter was extremely effective for customer service as well as PR/Marketing, and brand building and often delighted otherwise disgruntled customers with a resolution to their problem via Twitter.

I can't understand it when people say that Twitter doesn't increase sales or drive enough traffic. It prevents lost sales, opens new leads, puts your brand or business in front of active individuals, and overall, you get out of it what you put in.

over 6 years ago

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guy stephens

Interesting article and I think it simply illustrates that apart from the few examples where social media is being used well (Dell, ASOS, WigglyWigglers), there is still some way to go for many retailers in their social media journeys.

In the case of The Carphone Warehouse, there are some points I need to clarify, which may help to understand why attracting followers or building up sales, isn't our primary aim at present.

- you mention two different accounts which have very different purposes - 'cpwcares' is our dedicated customer services account, while 'carphoneware' is the official account for Carphone Warehouse and used primarily to announce press releases etc. Neither account is used for sales or to publicise new product launches.

- both channels tend to be reactive. With 'cpwcares' the idea wasn't necessarily to follow people, but rather to respond to our customer's questions and complaints. There was little to be gained in following people, who may or may not be customers. In terms of 'carphoneware', once again this was more about official announcements.

To date, we have not focussed on using Twitter as a lead for sales, but rather concentrated our efforts on using it as a customer service channel alongside our existing channels. I definitely think there is an opportunity for it to be used as a channel for sales leads, as I do for an account with perhaps a bit more personality, such as an 'overheardatmoo' type of approach. 

At the end of the day, each company will need to make up its own mind about Twitter and what approach to adopt based on sound business principles, and the relevance to their customers' needs.

over 6 years ago

James Gurd

James Gurd, Owner at Digital JugglerSmall Business Multi-user

Hi Trevor,

Thanks for the useful stats/links. I'm with Guy on the role/relevance of Twitter and I think his approach with CPW has been insightful for a lot of people.

Firstly, the obsession with #followers needs to go - the evidence shows that it is quality not quantity with social media. Not everyone is on Twitter to engage with brands or to buy, so the focus should be on building relationships with relevant followers. 

So Debenhams has 2,400 followers - what does that mean? The number means nothing in itself, what is important is the value that the communication with those 2,400 followers adds to both parties. I can't answer that as have not evaluated the Debenham Twitter account in detail.

One area, however, where there is potential for direct selling is for niche brands - @AcessoriesUK is a great example of a local company engaging with captive followers and driving traffic/sales via targeted promotions.

With Twitter it is essential that each company sets out its own goals and defines how their Twitter activity dovetails with existing communication channels and how it affects/supports each area of the business, from marketing to customer services. Interesting you make the point about SEO having the potential to drive more value - social media optimisation is a key part of SEO, so building Twitter presence independently of your SEO strategy makes no sense - the two need to be integrated. Business needs to lose the silo mentality.

Social media is no different to any other communication channel, you have to have a plan, dedicate resource, evaluate performance and make a commercial decision. Brands like Zappos have long understood that Twitter is a great tool for brand awareness and their interest is to use this to extend brand reach and drive the PR angle. Very much like investing in TV ads, it is not seen as a direct response and revenue channel.

For me the question a company needs to ask is why do they want to be on Twitter and how are they going to link it with other channels and measure the impact? It won't always deliver results but some companies leap in without thinking (remember Habitat) then wonder why it all goes pear shaped.

Just my opinion, welcome the thoughts of everyone else as always.

Thanks

james

over 6 years ago

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Tom Ollerton

I presented at the IAB Retail forum on this subject and have put some slides together on slideshare -  http://bit.ly/b5Ppqm

over 6 years ago

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legalbear

I see in www.tweetspinner.com that I geo target tweeters to follow based on the city in their bio. Tweetspinner set up www.followerwonk.com. That site allows you to search 13 million Twitter bios for keywords. I searched for two local cities in those bios. Loveland, Colorado, a city of 80-90,000 people had a grand total of 222 people that meantioned that city in their Twitter bio. Loveland's sister city, Fort Collins; a city of roughly 130,000 population had a grand total of 165 people with Twitter accounts. My idea of using Twitter to market to local people fell apart when I saw these totals.

When I think about it, the figures of 222 & 165 Twitter users in cities of those size seems accurate. If 250 million people live in the US of A, and only 13 million of them have a Twitter account, that's a half of one percent if I'm not mistaken.

I saw that Naked Pizza in Houston, Texas was using Twitter to sell pizzas locally. I saw a picture of them putting up a billboard telling passersby to follow them on Twitter.

I concluded that there has to be a better way to market locally.

over 6 years ago

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Elle Hawthorne

I don't follow retailers on Twitter, but I do have a bunch in a retailers in a Twitter list that I created. It was especially helpful during Christmas shopping to have one place to go to for finding specials and other retail information.

over 6 years ago

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Elle Hawthorne

Sorry for the typo. This is what I meant:

I don't follow retailers on Twitter, but I do have a bunch of retailers in a Twitter list that I created. It was especially helpful during Christmas shopping to have one place to go to for finding specials and other retail information.

over 6 years ago

Helen Coupland

Helen Coupland, ECommerce Manager at Freelance

Looking Dell's Twitter page http://twitter.com/delloutlet, it's full of 15 & 20% off voucher codes, so it's not hard to see why this would generate sales. But it is questionable how much would be incremental sales and not just customers who would have purchased anyway at full price. I think Twitter does have the potential to generate the sort of social shopping sales rush that I describe here http://heloucou.com/2010/01/when-social-shopping-can-really-work/ (my experience of seeing incremental sales with voucher codes & promotions on hotukdeals.com). I'd be interested if any retailer has seen a similar phenomenon with Twitter?

over 6 years ago

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