How social signals influence conversion rates for e-commerce stores?

Did you know FOMO is one of the best social media tactics to get the sales of your e-commerce store rolling? Read on as Valentin Radu delves deeper into the topic of social signals influence conversion rates for e-commerce stores.

Context

Online shops continued to soar in the last years, and, far from tapering down, the volume growth in comparison to brick-and-mortar stores is accelerating. It's also easier than ever before for new players to get into the game, with platforms like Magento or Shopify providing most of the technical and administrative elements needed to successfully run an online business.

Among other reasons, including the high rates of internet penetration, are the new marketing and advertising strategies that create explosive engagement on social media. You see an influencer wearing a T-shirt or people talking about it, and you just feel the need to have your own.

Social media engagement can be a great organic marketing strategy if you discover the recipe that works best for your online store. Let’s look at the components that define engagement, components we call social signals.  

Likes, tweets, followers, stars, hearts ♥, detailed articles and videos depicting unboxing experiences and ownership reviews, all count to a considerable portion of social media buzz. This is an authentic and organic tactic that can exponentially scale the conversion rate of online shops.

Research says that 42% of adults bought an item after seeing it on social media and 81% of consumers’ purchasing decisions are influenced by their friends’ social media posts.

Social media marketing strategies represent 1.08 percent of e-commerce website visits that result in purchases. These low conversion rates should not scare you, though. Your business could benefit so much from social media interactions. Social signals build brand awareness like nothing else, and brand awareness will always keep you top of mind, thus increasing your conversion rates.

To put it in simple words: all that is shared online matters. Let’s see how social signals directly influence the conversion rate of your online store!

Social signals build trust, and trust increases conversion rates

Social media signals improve website trust and make online retail more human. When you go in a brick-and-mortar store you connect to somebody in there, you place your trust in the sales assistant. Customers want to do the same with online shops. 88% of consumers will check a customer review before they buy.

Of all the types of testimonials and reviews, social proof is probably the most powerful.

When you say it, it’s marketing. When your customer says it, it’s social proof.

Besides, if people shout out loud how happy are with your product, you’re like: it has to be good, right? If you can make your customers speak about your brand, your products, their product testing and usage, you’re on the good path. Continue by offering them the possibility to let an impression, a photo or a video showing their feedback.

Let’s take a look at how ThinkGeek.com shares its customers’ photos on its home page:

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This way, the website encourages customers to share their product pictures with the #geekfamous hashtag, which benefits ThinkGeek in two ways:

• It shows that every product looks as good as the photos on their website.
• It proves that their products are already popular with a lot of people.

If a product has 20+ reviews (positive or negative), it will have a 83% higher chance of selling than one without any reviews. Don’t only hunt those epic, positive reviews.  A study by Reevoo shows that users will trust your website only if there’s a balance between positive and negative reviews; surprisingly, bad reviews have been shown to improve conversions by up to 67%.

If your main challenge is how to get more reviews and social proofs for your products, here are a few key takeaways that you can implement starting today:

• Send customers a follow-up email for a review a week after every purchase.
• Offer incentives for writing reviews (discounts, giveaways etc)
• Emphasize reviews on your site.
• Create great product videos that people will want to share on social media
• Answer to every review you get on social network pages and talk to people; make it as close to a real conversation as you can.

Social signals can induce feelings of missing out that drive people to buy more

Another important factor to consider, one that affects conversion rates and is closely tied to social signals, is the Fear Of Missing Out, or FOMO in short. FOMO is most prevalent among millennials. Around 69% of them experience the phenomenon, and 60% of millennials make reactive purchases because of FOMO.

When people are seeing products flaunting all over on Instagram, Facebook, Snapchat, they experience FOMO, or that gut wrenching feeling of being left in the dust while the others ride to the sunset.

Now, this is exactly what you want to do with your e-commerce store if you want to boost your conversion rate through FOMO.

Look, for example, at this green tea supplier that boosted conversion rates instantly via FOMO tactics. What they’ve done is that they’ve implemented a FOMO-feed that appears towards the bottom of the screen, to show real time cues. This increased conversions by a rate of 2%.

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Now, you can achieve similar results if you manage to get your customers to share their buying experience on social media.

Think about what you feel: what happens when you see 10 or 20 of your Facebook friends sharing the same product or when you watch dozens of Insta-stories with various influencers promoting the same “incredible moisturizing face cream” or "the latest razor you can't miss"? What’s your first thought? “I need this right now!” (I feel you, I do the same...). That’s because people are more likely than ever, and increasingly so, to feel the need to move with the herd.

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Beside those mentioned above, there are various methods to generate FOMO amongst your wanna-be customers. Here are some of them:

• Create scarcity & urgency

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• Utilize exclusivity

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There are even e-commerce apps that leverage the FOMO effect for increasing conversions, such as this one from Bigcommerce.

Influencer marketing is another strategy that’s on a constant uptick. This can improve so many aspects of your online store’s marketing strategy: brand awareness, trust, engagement, visibility, organic reach, and not to mention conversions. This is, perhaps, one of the most effective ways to use FOMO to grow your sales.

However, oftentimes you’ll have to pay for this type of exposure. If you have some budget, make sure you check out on these metrics for analyzing your influencer marketing efforts:

1. Reach – the number of followers an influencer has
2. Impressions or views – the number of people who viewed the content
3. Conversions – how many visitors took the desired action

Conclusion

Social proof and social signals matter. And as the e-commerce marketing landscape is changing, becoming denser and increasingly complex, we are adapting to it, whether we realize it or not.

Do you have any other insights on increasing conversion rates via social signals? Share them below!