How Social Media Impacts Consumer Spending


According to analysis, 46% of consumer use social media for purchasing. Although, the socially viral content has the ability to make people act in very specific ways that are positive for business owners. This states that social media use is prevalent and meaningful for all demographics. A new research also suggests that the social network for businesses creates a big impact on consumer spending.

A new study conducted by scientists from University at Buffalo School of Management determine social media posts for sentiment, popularity, and customers’ likelihood. They found that the viral contents on social media had the greatest effect on purchases.

Ram Bezawada, the study co-author said, “A neutral or even negative social post with high engagement will impact sales more than a positive post that attracts no likes, comments or shares. This is true even among customers who say their purchase decisions are not swayed by what they read on social media.”

Scientists analyzed data from a large specialty retailer with multiple locations in the northeast United States. They then combine the data about customer participation with in-store purchases before and after the retailer’s social engagement efforts.

With this study, scientists conducted another survey as well. In this survey they determine, what is the consumer’s attitude towards technology and social media? They found that the businesses social posts strengthen the effect of traditional television and email marketing efforts.

When the social media post combined with TV marketing, consumers spend more than 1.03%. Their cross buying was 0.84%. Cross-buying is when a customer purchases additional products or services from the same firm. Next, when it combined with email, the spending and buying rates were 2.02 percent and 1.22 percent.

That means, it clearly states that social media marketing matters. Thus, the managers should grasp it to build relationships with customers.

Bezawada said, “Developing a community with a dedicated fan base can lead to a definitive impact on revenues and profits.”



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