The power of social: How Facebook and Instagram drive ecommerce sales

What do people do on holidays and long weekends? This past weekend was both President’s Day, in which most people had an additional day off, and Valentine’s Day which fell on Sunday this year. Many people take the extra day – and the special occasion – to go out and enjoy activities like parks and restaurants. 

However, this year, with the pandemic still firmly rooted in our daily lives, the extra time that we have due to long weekends is often spent where we have been spending more time in the past year than ever before. 

No, not at home (although that is also true). We’re talking about social media. Traffic to the sites and apps from Facebook and Instagram hit all-time highs in 2020, and relative newcomers like Snapchat and TikTok aren’t stealing share from them, but rather adding even more fuel to the social media fire. Surveys show that most Americans are using all social media channels, from Twitter to YouTube, more frequently due to the pandemic.

They’re consuming content – that endless scroll! – and posting more often, but they’re also shopping. The rise in online shopping isn’t new; many people report shopping via social media even before the pandemic. 

But if one key piece to successful marketing is “meeting customers where they are,” and there are more potential customers than ever in social media channels, then that’s where ecommerce brands need to go, right?

Advertising on social channels like Facebook and Instagram have proven to be a significant driver of demand for many DTC brands and helped them gain market share. MVMT, for example, went from zero to $90 million in under five years by partnering their Facebook ads strategy with Instagram distribution which improved their Cost Per Action (CPA) by 20%

But it wasn’t just about cost efficiency. Yes, MVMT succeeded because they were able to run their data-driven ecommerce store and advertising campaigns as most traditional ecommerce businesses do, with transactional and optimization strategies like split testing and different ad formats. 

Yet the nature of social media – it’s social, and it’s media – meant that they could simultaneously implement strategies that were true to their lifestyle brand, including magazine-style photography, consistent branding and customer-centric campaigns like social proof, responsive service and loyalty rewards.

MVMT is just one of the tens of thousands of ecommerce brands that use Facebook Advertising, and for good reasons: 

  • Unlike search, where users need to already be looking for your product, Facebook and Instagram allow for product discovery
  • Both are extremely visual, you can show off engaging images and videos of your products (and customers!)
  • For any brand looking for massive scale, you can’t beat these two platforms that together have billions of monthly active users. Specifically, if you’re looking to reach generations like Gen Z and Millennials, these platforms are where you will find them Here you can see how young Instagram skews:

While these are all good reasons why ecommerce brands choose these platforms for their ad dollars, we believe the main reasons why 90% of digital marketers are using Facebook ads is because of the level of tracking and targeting you can obtain.

Tracking is extremely important in the ecommerce ecosystem, because you need transparent and accurate reporting on campaign-driven revenue to make smart decisions about your future marketing strategy. 

Moreover, this data, when it feeds into larger, holistic systems that can leverage it not just for sales but for finance, operations and other areas – a true data warehousing and AI-driven ecommerce platform – plays an essential role in bigger decisions for the business as a whole.

Targeting is also critical for reaching customers who will buy your goods. Facebook’s targeting system has been the most sophisticated to date due to the incredible amount of personal data they have about their users. 

It’s not just demographics, but their preferences and behavior that are so compelling. If you’re selling a family meal subscription service, sure, you might want to target middle-aged women with children. But what’s more important is finding women who are working professionals (e.g., have little time to cook) and who are aware of the category, maybe even who follow your competitor! 

With Facebook targeting you can also create lookalike audiences and use their pixel to retarget those users, allowing you to “remind” a potential customer of a product they were looking at, promote upsells and cross-sells, promote discounts and even find people on their mobile device. For a full description of these capabilities – and how to do it – we recommend this post.

Lastly, though, there is one major consideration when it comes to the Facebook/Instagram Audience Network – the latest news from Apple that they are introducing a privacy popup on all apps on iPhones, where they specifically make users opt in to tracking used for advertising purposes. This will deal a huge blow to Facebook, as many estimate up to 80% of their users will opt out of tracking and data collection. This will significantly reduce the volume and the quality of the user data that makes Facebook advertising so effective.

Social media isn’t going to decrease in popularity anytime soon, and with so many DTC brands successfully leveraging these platforms to drive topline sales growth, it’s a channel that is well worth exploring for your brand.  

Of course, it’s not enough to execute on social media advertising – you must be able to see its effect on your business, too. Get all of your social media advertising data alongside your ecommerce data with the Tradeswell platform. Learn more about how Tradeswell can provide your brand with a single source of ecommerce truth for effective and efficient decision making.

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