Online Social Media – how much does it actually influence buying decisions ?

As a consumer, I am influenced by online social media. But the bigger the purchase, the less I am influenced by “online” social media, and more by “offline” social media.

I won’t try a new restaurant without checking yelp reviews.I won’t buy a book without reading what others say in Amazon. I won’t buy a widescreen TV without checking 15 sites and then talking to store clerks, friends etc. When I bought a house (the biggest purchase for me), I did comparisons online – but eventually I had to walk in and out of 50 or so houses before my wife and I agreed on a place. The bigger the purchase – the less I trusted social media, and the more I trusted “real” people and my own “physical experience.

When I say social media – I am typically thinking only of “online” media – twitter, facebook and sites like that. I am excluding other “offline” social things like hanging out with my buddies at the water cooler, chatting with other parents at my daughter’s swimming lessons, talking to others on phone and stuff like that which we don’t associate with “online”, despite being totally “social”.

It never fails to impress (ok, and scare) me when I log on to a site, and find context specific advertisements. I have seen a lot of SAP ads,Pet product ads, Cricket (the game, not the mobile phone thing, and not the creature ) and Tennis ads and so on when I use my yahoo email, google searches and facebook. Fantastic – yet in all these years, I have not clicked on even one link that these sites showed me. If anything, I get some pleasure in not clicking on them – since in my mind, I think of them intruding my private space.

And although not prolific by any stretch – I am fairly active in online social media, and spend some time every day on it. At best, it must be having an indirect effect on my buying decisions, since my gut feelings over time are surely influenced by what I read, and I read a lot of stuff online.

I started to think that maybe direct advertising is what is not working in social media – and that vendors can influence indirectly using social media by sharing information via blogs etc. But Forbes advoice single handedly ended that theory for me. I honestly cannot stand most of what gets published there by vendors and now it has gone to an extent that I don’t take any time to even glance at it when someone says “Forbes says” and point to an advoice link. No thank you.

TV advertisements influence me more than social media ads. I am not sure exactly why this happens. My hypothesis is that people have more experience making them and tuning them over years that it makes more impact. But even then – when it comes to big purchases, I still prefer the offline social media . It could also be that I grew up watching TV and not online social media, and hence am more influenced by TV. Others who are younger might not look at it the way I do. Yet another theory I have is that while video is more impressionable for me, since I consume most of the online content on my mobile device, low bandwidth decreases the user experience of video ads online, there by making me tune out quickly.

Enough about me as a consumer, what about me as a professional consultant and a seller of consulting services ?

All my clients know that I blog and tweet, and that I share some (hopefully useful) content with them – and some of their CXOs tease me on what I write. So, on the bright side – they do read what I write. I also have on occasion benefited from name recognition from my blogs, where I walk into a room and someone googles me and checks out the content that I have authored in past, and (so far) giving me some credit. But I cannot imagine (yet) any one who has given me business primarily because of what I have done in online social media. Not by a long shot.

Buying decisions for consulting services are still mostly influenced by past performance on delivery, trust,price, word of mouth publicity (even fierce competitors talk to each other when it comes to quality of consulting services or product maturity).
I am yet to see a multi-million dollar deal signed with a CXO saying – “it is your online ads that finally persuaded me”.

Even the big cloud players who sell the idea of “online sales” will readily go in person to meet the clients and sell them on their cloud wares. Sales people can be very superstitious. I have a friend who insists she needs to wear her “closing heels” to get ink on the contract, and another friend who insists on wearing his “deal making tie” for the same purpose. I keep wondering what will be the equivalents when it becomes virtual.

“Digital eminence” as my employer refers to it, is a big deal these days. Clients do google about consultants – and check out linkedin profiles and all that. And I have been rewarded to some extent in my career for my online social media activities. But when I think about it – I think what gave me some credibility in online social media is the experience I gained (and continue to gain) in the offline world. That outweighs the reverse situation of online credibility helping me in the offline world. It will be interesting to watch if this balance will ever shift in future. I am not holding my breath on it.

What about big companies who tried innovative online social media advertising? Couple of years back – Pepsi had such an initiative that I read about. I believe it was called “Refresh”. I am typing this on my flight to Portland, so I cannot google it to confirm. They took their foot off the gas pedal for TV and print ads, and focused heavily on online social media – primarily facebook I think. I do not follow superbowl, but I did hear they even pulled out of advertising there for that year. How did it work out for them ? They got tremendous coverage from analysts and marketing experts for being innovative and all that. But it did not exactly help them increase the sales of the pepsi softdrink. Not only did classic coca-cola remain the number one drink, pepsi lost the second spot it long held, and that spot was taken by diet coke. Pepsi went right back to heavy advertisements on TV etc quickly after that. The irony is not lost on me – since I followed this story using online social media 🙂

I am not saying that this experience will stay the same for other companies. It probably will improve over time. If I am a representative consumer – then companies will do well to pair TV and online social media to work together. I say this because I forgot the last time I watched TV without multi-tasking on an online device at the same time. In fact, I usually check out things I see on TV at real time on internet, and make buying decisions depending on size of purchase.

Now there is one last thing – I have no idea if my view is shared by any one else on the planet 🙂