FreshNetworks Blog

Golden Ticket (Photo credit: Derek Lakin)

Ticketing company Eventbrite has released its social media data and shows that it make an additional $3.23 (or £2.01) in revenue every time an event is shared on social media. This is highest for Facebook (£2.56 revenue per share) followed by Twitter (£1.15) and lowest for LinkedIn (£0.57). These figures look great. But what does it say about social commerce and what can other brands learn?

First it is worth exploring these numbers a little bit more. Twitter drives the most clicks (almost twice as many as for every share on Facebook) but these are much less likely to lead to a sale. In fact for every click through from a share Twitter generates the least revenue (just 3p per click compared with 18p for Facebook and 6p for LinkedIn.

So we can surmise the following:

• When an event is shared on Facebook more revenue is ulitmately created per share than on any other social channel
• People are more likely to click through to an event on Twitter than on any other channel but they are less likely to purchase

Facebook not only generates more revenue per share, it is much more efficient at it.

The social nature of ‘events’ as a product

This allows us to explore a little more what is happening in social with Eventbrite, and whether the ‘success’ they have had with social shares could be repeated for other brands.

Eventbrite’s product is events, and these are inherently social; we typically go to an event with people – friends or colleagues. So should it be any surprise that when these events are shared on social channels other people go ahead and book. A simple look at how Eventbrite events are shared on Facebook shows a long list of people telling others where they are going and asking them to go with them. It should not, therefore, be surprising that some people do.

In fact the nature of the product means that the shares are different to most products that people share in social.

• If the product you share were a pair of shoes, for example, you are likely to be saying ‘I like these shoes’ or ‘I just bought these shoes’. These are personal reasons with no clear call to action for your friends (except a bit of jealous perhaps).
• When you share an event you are usually saying ‘I am going here, you should too’ or ‘Anybody want to come with me to this event’. You are giving your friends a clear call to action to click through, attend the event and spend money.

So on this basis it is no surprise that Eventbrite should be generating revenue like this from social shares. And it should be no surprise that Facebook is the most efficient way of getting this revenue; the connections you have with people there are typically stronger than on Twitter.

But could these revenue numbers be shared by other products? Unlikely, unless your product is also social in nature. This is a great example of where social does make sense – the product is social, you experience it with other people, and so making it easier for you to find others to attend the event with makes absolute sense to the consumer and the brand.

The key thing we can learn from Eventbrite? Use social in the ways it can have biggest impact on your business. And this depends on what you are selling and to whom; one solution is not right for all.

Walmart, the world’s largest retailer, acquired social media firm Kosmix just over a year ago, creating @WalmartLabs, with the intention to use this specialist R&D unit to define the future of commerce by merging social, mobile and retail.

So far WalmartLabs has released two interesting developments using social:

• ShopyCat – the gift recommendation engine

This Facebook application uses your Facebook profile to suggest suitable products for you, based on the interests and hobbies of your friends. An interesting aspect of this approach is that the app will offer links to other retailers if Walmart do not stock a suggested item in their own stores.

The notion that the app may steer customers away from Walmart may seem unusual, but the brand sees more long-term gain in making the service as useful and relevant as possible to its customers.

• Get on the shelf – innovative product pitching

‘Get on the shelf’ was a contest that allowed innovators to pitch their products to Walmart customers, who then voted for the ones they would like to see Walmart stock.

Over a million votes were cast, narrowing the field down to three products that will now be available to purchase in Walmart: a DIY-screw replacement system for glasses; an airtight plate cover for food storage; and the overall winner – a socially conscious bottled water whose company donates its profits to provide clean water supplies.

The next step – Big Data

These examples are innovative approaches to using social media to encourage sales and generation of inventory, but the area that I think will prove the most fascinating is how WalmartLabs will leverage “Big Data” to develop the retailer’s ability to predict market demand and so optimise their supply.

Understanding and fulfilling local demand

This is where the situation becomes truly interesting – stores will be able to optimise their inventory according to their area’s specific tastes and seasonal demands.

One of the examples WalmartLabs’ Venky Harinarayan offers is that of college football. By monitoring social media buzz during college football season, Walmart is able to determine when discussion about college football in a certain locality is beginning to heat up. This lets them know when they should be stocking products that are related to the season and local teams.

Creating demand and making recommendations

As ShopyCat has demonstrated, recommendation engines enable customers to discover new and relevant products, either for themselves or their friends. As I mentioned above, ShopyCat currently directs customers to alternative suppliers, but from understanding customer behaviour and using Big Data, a logical evolution would be for these alternatives to become increasingly niche as Walmart develops supply according to consumer taste.

The ability to bring all of these channels together in-store via mobile will be significant. WalmartLabs are developing in-store navigation using mobile, so I would expect to see apps that offer customers information and the location of recommended items, or prompts for items of interest that are already in close proximity. A reminder of a friend’s upcoming birthday and interest in fishing, while you are passing the sports section, for example, would help you make a relevant purchase while saving time and hassle.

You may’ve heard that supermarket behemoth Tesco has signed up for Foodie.fm – a service which has been dubbed by its backers as “the Facebook for grocers”.

Launched by technology firm Digital Foodie, Foodie.fm claims to be the first social network to offer a social shopping platform for grocers via a fully integrated checkout with www.tesco.com.

Having purchased social media company BzzAgent back in May last year,Tesco is certainly not shy about using social media as part of its wider business strategy, and their partnership with Foodie.fm looks like another way of embracing multichannel more effectively.

Foodie.fm, available as free app on iPhone, Android and Nokia applications, as well as via the Web and Facebook, enables users to make friends with other food lovers and to swap cooking tips and recipes. Visitors can create an editable shopping list, based around a meal, by clicking on photos of recipes. For example, if a user was to click on the recipe for beef burgers, the shopping list would consist of  mince meat, onions, salt, etc.

The Foodie.fm site then checks availability with Tesco before the order is placed, the customer pays and delivery is arranged.

At the core of Foodie.fm is a recommendation system that learns from a user’s eating and purchasing habits, and suggests recipes and groceries that match his or her ‘taste profile’. The system takes into account personal preferences like food allergies or intolerance, as well as any budgetary restrictions. This enables users to personalise their profile and allows the site to suggest recipes and groceries to match customer profiles. It is this customised shopping list that will help the consumer plan and budget for a week, or even month’s worth of meals, and the shopping that is needed for it, in one go.

Until now, food retailers and consumer packaged goods were somewhat sheltered from the toughening economy, with 40% of people spending more on groceries than 3 months ago (according to Deloitte) – a result not just determined by inflation, but the fact that the tough current economy means that people spending are more time at home cooking for themselves rather than eating out in bars and restaurants.

However, as Deloitte has pointed out in their recent Consumer Review,  40% of the value of all transactions in non-food retail are now digitally influenced, and it’s hard to believe this influence will not impact food and consumer packaged goods too moving forward.

With this in mind, food retailers would do well to explore options like Tesco’s partnership with Foodie.fm. Given the rise of the connected customer, retailers should look at strategies for integrating social and multichannel into their offering, and should look at ways at becoming an agile and fully engaged social business.

Making purchases directly from within Facebook (a form of social commerce) has the potential to make the social network a place where we spend not just considerable amounts of our time, but also our money.

Social Media Influence has created this infographic which reflects on the past two years of Facebook commerce (known as “F-commerce“).

From the very first purchase ($34 worth of flowers) through to movie rentals and mobile phone credit purchases, F-commerce already has a varied history, and this is just the beginning.

Some key points of interest:

• 67% of shoppers spend more when they have received a recommendation from their online community of friends.
• Just 11% of the surveyed UK customers have bought something from Facebook.
• Only 8% of retailer Facebook pages are able to accept transactions.
• Predicted value of social commerce is set to reach $30bn worldwide by 2015.

Every time people share an event from Eventbrite with their friends and contacts in social media or by email, they generate $1.78 in ticket sales. This figure comes from a recent study by the event ticketing site which analysed their user data and how shares in social media and by email tracked back to ticket sales. This is a surprisingly powerful number and shows the growing importance of social shopping – using recommendations in social networks and online communities to influence purchase decisions.

Eventbrite is, undoubtedly, a prime candidate to be benefiting from social shopping before others. Events are, by their nature, things which connect people with similar interests – people like you. If you love jazz and connect with people like you in social media, then were you to share a jazz event with you then the chances of this appealing to them is quite high. Events are a prime candidate for social shopping and this study by Eventbrite highlights just how powerful it is.

How much is a social media share worth?

The study by Eventbrite found that, on average, every time an event was shared that resulted in $1.78 in ticket sales. Drilling down into this number shows how valuable different types of share are:

1. Facebook: $2.52. Facebook resulted in the highest average ticket sales per share with every ‘Like’ on the social network resulting in $2.52 in ticket sales. That this is the most valuable type of share is not surprising – Facebook has grown with events and users are accustomed to inviting people to or accepting events on the platform. Overall this is a very important driver of traffic and sales for Eventbrite – it is the sites biggest referrer of traffic and every ‘Like’ drives 11 visits back to the site.
2. Email: $2.34. The second most valuable sharing mechanism was not a social media tool at all, but email. This is not surprising – email is likely to be much more targeted as users need to select individual people with whom they want to share the event, rather than just publicising it to all people they connect with in a social network. That this is not the most valuable type of sharing is a surprise and shows the ever increasing power of Facebook and other social networks as a communications and sharing mechanism.
3. LinkedIn: $0.90. LinkedIn shares are the third most valuable with an average of $0.90 in ticket sales generated every time an event is shared on the social network. This is much less than for shares on Faccebook or via email but is still significant driver of sales.
4. Twitter: $0.43. Shares on Twitter are the least valuable of all four means, with each share worth $0.43 – almost a sixth the value of a Like on Facebook. This is, perhaps, a sign that connections on Twitter are less focused than on Facebook, or perhaps that on Twitter shares and messages are less engaged with – indeed recent research from Sysomos showed that over 70% of all Tweets get no response. So Twitter messages may be less engaging than those on Facebook, leading to fewer clicks and so fewer ticket sales.

These numbers are impressive and the data from Eventbrite is a great insight into social shopping and how, at least in the event ticketing market, recommendations and shares in social media can lead to significant ticket sales. People are using social media to connect with people who have similar interests and passions to them – this makes for a potentially valuable territory for social shopping. Recommendations from people like you carry a lot of weight – for Eventbrite, each recommendation leads to $1.78 in revenue from ticket sales.