engaged social followers are your best customers

A Forrester Consulting

Thought Leadership Paper

Commissioned By Wildfire

(A Division Of Google)

September 2013

Engaged Social

Followers Are Your Best

Customers How Marketers Can Leverage Social

Tools Throughout The Customer Life

Cycle

Table Of Contents

Executive Summary ........................................................................................... 1

Your Audience Turns To Social Media Throughout The Customer Life

Cycle ..................................................................................................................... 2

People Who Engage With Brands In Social Media Are Better Customers . 4

Key Recommendations ..................................................................................... 7

Appendix A: Methodology ................................................................................ 8

Appendix B: Endnotes ....................................................................................... 8

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1

Executive Summary

Nearly every online consumer now uses social media, and

nearly every marketer has followed its audience into social

channels. More than 85% of US online users engage with

social media on a regular basis. Likewise, more than 90% of

online marketers say they’re already using social tools to

reach these social audiences.1

In May 2013, Wildfire, a division of Google, commissioned

Forrester Consulting to more closely evaluate how people

use social tools to discover, explore, buy from, and engage

with five category-leading brands and companies — and

how valuable those socially engaged customers are to

companies. Then to further explore this trend, Forrester

developed a hypothesis that tested the assertion that

customers primarily use social media to engage with the

brands they already know, and that these socially engaged

audiences are among companies’ most loyal customers.

In conducting an online survey of 1,811 US social

networking users, Forrester found that people actually turn

to social channels and tools throughout their customer life

cycle — and that people who engage with a brand in social

media are more likely to prefer and buy from that company

and recommend its products to others.2

KEY FINDINGS

Forrester’s study yielded three key findings:

› People turn to social media throughout the customer

life cycle. Our survey shows that customers do indeed

use social media primarily to engage with brands after

they’ve made a purchase — but they also use social tools

at every other stage of their customer life cycle. For

instance, social ads and word of mouth create awareness

and discovery. Prospects also turn to social networks and

peer reviews when they’re exploring and considering a

company’s products and services.

› People who frequently engage with companies in

social are better customers. When we modeled the

relationship between customers’ social media

engagement with companies and their value to those

companies, we found that social media engagement has

a strong positive correlation with people’s preference for a

brand, their likelihood to have purchased from that brand,

and their willingness to recommend that brand. And the

more frequently people engage with companies in social

media, the more valuable they are likely to be as

customers.

› Companies must see social tools as part of a larger

puzzle. To get the most value from social tactics,

marketers must fit those tools into the larger context of

their customer’s journey and their own marketing

programs. Mapping each social tool to the stage of the

customer life cycle where customers use it will let

marketers better support those customers. And

considering which nonsocial touchpoints customers are

using alongside each social tool will help companies

design better-integrated marketing programs.

People who engage brands in social media are

significantly more likely to buy from and

recommend those brands.

2

Your Audience Turns To Social Media Throughout The Customer Life Cycle

The growth of digital media has changed how both

consumers and business buyers interact with companies.

Today, most people don’t simply move through a traditional

sales funnel that starts with awareness and ends with

purchase. Instead, your customers and prospects most

commonly follow a circular four-stage customer life cycle in

which they: 1) discover your company and the products and

services you sell; 2) explore whether your offerings are right

for them; 3) buy your products and services; and 4) engage

with you, and with their friends and peers, after their

purchase (see Figure 1).

And while you may consider social media primarily a tool for

creating engagement, our survey shows that your audience

turns to social tools throughout the customer life cycle:

› Social advertising and word of mouth create

discovery. Marketers commonly turn to reach tactics

such as TV advertising and in-store promotions to drive

awareness of their latest offerings — and consumers

report that these channels remain an important part of

how they discover products and services.3But social

tactics can also play a key role in helping marketers

create discovery. In fact, people who engage with brands

on social networks say that paid social ads are the most

common way they find out about new products and

services online (see Figure 2). Likewise, both online and

offline word of mouth play a leading role in driving

awareness of new brands and offerings.

› Social networks and consumer reviews support

exploration and buying. When people seek out greater

depth of information about the products and services

they’re exploring, they most commonly head online —

especially to search engines. But once again, social plays

an important role at this stage of the customer life cycle.

More than one-third of people who engage with brands on

social networks say they typically turn to those social

networks when they’re researching products or services

(see Figure 3). Detailed reviews from other consumers —

on retailer sites, manufacturer sites, and consumer review

sites — also play an important role when people are

exploring your offerings and making purchases. In fact,

one recent survey showed that 43% of all online users

prefer to buy products or services from websites that

allow customers to post ratings and reviews.4

› Branded social networking pages foster engagement.

People have many options for staying up-to-date with

their favorite brands and companies — including signing

up to receive email and postal mail, as well as visiting

those brands’ websites and retail stores (see Figure 4).

But over one-third of people who engage with brands on

social networks say the reason they do so is to stay in

touch with the company or brand. And while many of

those customers are looking for special offers or

discounts, four in 10 say they also visit branded social

networking pages to hear about companies’ latest

products and offerings. Customers also report that

branded communities and blogs play a role in how they

engage after the point of purchase.

FIGURE 1

Most Buyers Follow A Four-Stage Customer Life Cycle

Source: “Win The Social Marketing Measurement Game,” Forrester

Research, Inc., November 21, 2012

3

FIGURE 2

Social Ads And Word Of Mouth Play A Leading Role In Driving Discovery

Base: 1,684 social networkers who do engage with brands on social media (select responses shown)

Source: A commissioned study conducted by Forrester Consulting on behalf of Wildfire, May 2013

FIGURE 3

Social Networks And Consumer Reviews Are Vital When People Explore And Buy

Base: 1,684 social networkers who do engage with brands in social media

(select responses shown)

Source: A commissioned study conducted by Forrester Consulting on

behalf of Wildfire, May 2013

FIGURE 4

People Turn To Branded Social Networking Pages To Engage Their Favorite Brands

Base: 1,684 social networkers who do engage with brands in social media

(select responses shown)



4

People Who Engage With Brands In Social Media Are Better Customers

Not only does your audience use social tools throughout

their customer life cycle, but the people who engage with

you in social media are likely to be among your very best

customers. In fact, a recent survey of 1,811 US social

networkers shows that social media engagement positively

affects the likelihood of several key brand events, including

purchase, recommendation, and brand preference.5

For our analysis, we used logistic regression modeling to

quantify the relationship between a social media

engagement and the quality of a customer. (This study

focused on five leading brands from a range of product

categories, including several Wildfire clients, who boast

enough social media fans to provide a usable survey

sample.) These models assess the impact that drivers like

engaging with a brand in social media have on such metrics

as making a purchase from, recommending, and preferring

that brand. By specifying characteristics of an individual or

target, a logistic regression model predicts the probability of

occurrence of an event.

In other words, with everything else being equal, this

analysis shows the influence of one variable on other

variables — and found that social engagement with brands

has a strong positive influence on other key behaviors

throughout the customer life cycle:

› Social media brand engagers are more likely to

purchase from the brands they engage with. For all

five brands in our study, individuals with a social media

engagement with the brand have a higher probability of

having made a past purchase.6For example, an individual

who engages in social media with one large

entertainment brand we studied has a 54% probability of

having made a brand-related purchase in a 12-month

period, compared with a 24% probability of an individual

who does not engage that brand in social media (see

Figure 5). Similarly, someone who engages in social

media with one leading consumer electronics brand we

studied has a 51% probability of having purchased their

products in the past year, compared with a 26%

probability of an individual who does not engage with that

brand in social media.

› People who engage with brands in social media are

also more likely to prefer those brands. Across the five

brands we studied, people who engaged with the brands

in social media have higher probability of preferring the

brand compared with nonsocial media brand engagers.

For instance, someone who engages in social media with

one quick-serve restaurant chain we studied has a 71%

probability of preferring it over similar restaurants,

compared with a 47% probability of an individual who

does not engage with that chain in social media (see

Figure 6). Likewise, an individual who engages in social

media with a consumer packaged goods (CPG)

organization in our study has a 65% probability of

preferring it over similar brands, compared with a 48%

probability of an individual who does not engage with that

CPG in social media.

FIGURE 5

Purchasing Is The Largest Social Factor For Some Brands

Base: 1,811 social networkers

Note: Social media engager refers to individuals who engage with the

brand on one of five large social networks



5

› Social users are more likely to recommend the

brands with which they engage. Individuals who

engaged with the five brands in our study also had a

higher probability of recommending those brands to

others. For example, someone who engages in social

media with one national retailer in our study has an 82%

probability of recommending the retailer to friends,

compared with a 65% probability of an individual who

does not engage with the brand in social media. And an

individual who engages in social media with the

entertainment brand we studied has an 81% probability of

recommending the brand to others, compared with a 60%

probability of someone who doesn’t.

› The more someone interacts with a brand in social

media, the higher their likely value to the brand. Our

surveys show that people who engage with a company

every day in social media are likely to make twice as

many purchases from that company as those who engage

only monthly (see Figure 7).Brand perception and

likelihood to recommend are also typically stronger

among people who engage with brands in social media

more frequently (see Figure 8).

One important statistical note: These findings suggest

correlation, but not necessarily causation. Our models

quantify the relationship between social media engagement

and brand metrics like past purchase, recommendation, and

brand preference. However, it says nothing about causation.

These social media brand followers may already be brand

enthusiasts who are already avid customers. But either way,

the large impact of a social media engagement on brand

metrics means that your social media followers are both

valuable customers and brand advocates.

FIGURE 6

Brand Preference Is The Biggest Social Factor For Other Brands

Base: 1,811 social networkers

Note: Social media engager refers to individuals who engage with the

brand on one of five large social networks.



FIGURE 7

Those Engaging With A Brand Daily Are Likely To Make Twice As Many Purchases Than Monthly Engagers

Base: respondents who engage with brand(s) on social media


6

FIGURE 8

Brand Perception And Likelihood To Recommend Are Stronger From Those Who Engage More Frequently

Base: respondents who engage with brand(s) on social media


7

Key Recommendations

To get the greatest value from social media, marketers must both see the broader picture and learn to focus on the

right specific tactics. Follow these five rules to build successful social programs:

› Use social tactics throughout the customer life cycle. Many marketers still think of social simply as a tool for

engaging their existing customers. But while many who interact with companies in social media are existing

customers, our data show that customers also use social touchpoints when first discovering companies and

exploring what they have to offer. To succeed in social media, it’s important that marketers map each of their

social tactics to the stage of the customer life cycle where customers use it — and then consider the messages,

content, and experiences they should offer customers at those exact stages of their journey.

› Utilize multiple social networks. Sure, the largest social networks play an important role in your customers’

social behaviors. But this survey shows that your audiences use a range of social sites in their customer journey

— and so should you. For instance, people often turn to consumer review websites when they’re exploring a

product, and many use blogs and communities on marketers’ own sites as a form of post-purchase engagement.

Smart marketers are using a mix of social channels and destinations to support the entire customer life cycle.

› Give people what they want from social sites. You probably know by now that most people who engage you in

social media are looking for offers, discounts, and promotions.7But many are looking for other types of value as

well. More than 50% of people who engage with brands on social networks say they want to hear about your

latest products and services — which shows that discounts aren’t required to upsell these followers. Likewise,

40% follow you in social channels simply to read entertaining or interesting content — proving the value of

engaging topical social content.

› Post regular updates to keep your followers coming back. Our surveys show that people who frequently

engage with a company in social media are likely to be among that company’s most important customers. So

keep your existing social audience active by posting at least once each day. Many large marketers now create

content calendars to ensure a constant flow of interesting and useful posts into their social channels.

› Use social in concert with other channels. Remember: While important, social is just one piece of the

marketing puzzle. At every stage of the life cycle, customers cited nonsocial channels that were also important to

them. And our regression analysis showed that while social media engagement is highly correlated with

purchase, recommendation, and brand preference, other brand interactions, such as visiting a website or

participating in a loyalty program, also show a strong effect size in our models.8The bottom line? Marketers must

use nonsocial touchpoints alongside social tools to craft successful integrated marketing programs.

8

Appendix A: Methodology

In this study, Forrester conducted an online survey of 1,811 US consumers. Respondents to the survey were screened on

their use of social networking sites. Questions in the study related to their awareness of specific brands, their interaction with

the brands on various social networking sites, and their buying history/plans. Respondents were offered an incentive as a

thank you for time spent on the survey. The study began in May 2013 and was completed in June 2013.

Appendix B: Endnotes

1 Source: “Global Social Media Adoption,” Forrester Research, Inc., June 27, 2012 and “Integrate Social Into Your Marketing

RaDaR,” Forrester Research, Inc.,August 7, 2013.

2 The sample of our survey represents a social media-savvy audience and consists of US social networkers who engage

with brands on various social media websites.

3 In fact, TV and promotions are among the top offline methods for consumers to discover new brands, products, or services:

71% of US online adults report using TV and 51% report using in-store promotions as ways they typically discover new brands, products, and services. Source: North American Technographics

® Consumer Deep Dive: Investigating The

Customer Life Cycle (Discover Phase) Survey, Q3 2012 (US), Forrester Research, Inc.

4 Source: North American Technographics

® Retail Online Benchmark Recontact Survey, Q3 2012 (US), Forrester Research,

Inc.

5 Note: Purchase refers to having made a purchase from the brand in the past 12 months, recommendation refers to

recommending the brand to a friend or family member, and brand preference refers to preferring the brand over similar brands.

6 Note: Social media engager refers to individuals who engage with the brand on Facebook, Twitter, Google Plus, YouTube,

or Pinterest.

7 Sixty-three percent of US online adults who engage with brands on social networking sites look for deals, discounts, or

special promotions, the top action taken by consumers engaging with brands in social media. Source: North American Technographics

® Online Benchmark Survey (Part 1), 2013 Q2, Forrester Research, Inc.

8 Effect size is measured by the odds ratio. For example, the odds ratio for being a social media engager of a large

entertainment brand in the purchase model is 3.7. This means that the odds that an individual who engages with the large entertainment brand in social media will purchase a product from that brand or service are 3.7 times higher than the odds of someone who does not engage with that brand in social media (all other things being equal). Do not confuse odds with probability.

engaged social followers are your best customers

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