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WHITEPAPER /
MARCH 17, 2011
The Eect o Social Networksand the Mobile Web on Website Trafc and the Inevitable Rise o Facebook Commerce
EXECUTIVE SUMMARY
An interesng dilemma that companies have been facing of late is whatlevel of promoon is necessary for their website vs. their Facebook page.Recent campaigns show evidence that a few companies have brokentradional norms in direcng trac directly to their fanpage, surpassingtheir websites. What started as a means to an end of drawing people towebsites is becoming an end in itself. Such a blatant favorism showcasedtowards the Facebook presence of a brand is not without reason. Withaccess to more than 600 million members, an ever increasing fan baseand an opportunity to engage closely with the audience, companiesdesire a glorious ride on the social sea. But where does all this leave thewebsite?There is a popular percepon that brand websites are losing trac totheir Facebook counterparts, although only a couple of examples havebeen cited in blogs. As a step towards nding quantave evidence, weanalyzed the website trac of Fortune 100 websites based on ‘uniquevisits’. The study revealed that 68% of the top 100 companies wereexperiencing a negave growth in unique visits over the past year, with an
KEY FINDINGS
• Websites that do not engage in e-commerce are losing tracto their Facebook pages at a startling rate• Facebook stores are very ecient at trac acquision ac-quiring visitors at no cost through wall posts and establishinga store monthly user base equal to 1-10% of the retailer’s fanbase• Facebook commerce conversion rates ranging from 2% to 4%are on par with Commerce websites.
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average drop of 23%.To ascertain if Facebook had a part to play in this decline, unique visits to a brand’s websitewere compared with unique visits to its Facebook page (obtained using fan count as a proxy)within a three to ve month period. In a sample of 44 companies, 40% exhibited higher tracto their Facebook page compared to their website. When these companies were categorizedbased on the presence or absence of e-Commerce transacons, we found that the majority of the companies (65%) in the ‘Non e-Commerce’ category received higher trac on Facebookcompared to their website. On the other hand, most companies (about 77%) featuringe-commerce did vastly beer on their websites, although exhibing a sharp decline in annual
visits.
Finally, we examined the recent growth in Facebook commerce, in parcular e-Commercetransacons occurring in stores within Facebook pages and newsfeeds. Adgregate Markets,a provider of Facebook commerce services, has signed over 50 retailers, most in the InternetRetailer Top 500, over just the last few months. With early data from Adgregate Marketsindicang that their network of Facebook stores are more ecient at acquiring visitors and justas eecve at converng them, Facebook commerce appears poised to take o.We conclude from this research that Facebook is gaining tremendous popularity as a desnaonto connect with brands online, and is increasingly chosen over the websites of certaincompanies. Though there are websites sustaining trac in spite of Facebook, we predict thatit will be short-lived unl Facebook catches up with e-commerce in a big way, which the datain this thesis indicated is just around the corner. With the mobile web also growing in size andpopularity, it is me for brands and retailers to understand that surviving online is no longerabout all-in-one websites, but measuring and improving performance in all the social, mobileand web enes.
FIGURE 1: YEARLY CHANGE IN UNIQUE VISITS
WEBSITE TRAFFIC IN THE PAST YEAR
FINDINGS
Majority of companies (68%) in the top 100 list experienced fewer visitsto their websites indicated by a negave percentage change from 2009 –2010 (Figure 2). The average drop was -23.02%, and the range varied upto -76%There was no strong correlaon among companies that receiveda posive trend in terms of industry vercal, although most of thecompanies with e-commerce transacons sustained higher trac levels(not surprising given the amount of budget retailers expend driving tracthrough SEO, online display, email, etc.)
FIGURE 2: CHANGE IN UNIQUE VISITS NOV 2009 NOV 2010
To test the hypothesis of decreasing website trac, we analyzed the one year (Nov 2009 – Nov2010) trac trend of the top 100 Fortune 500 companies. The number of unique visitors towebsites was obtained from Compete.com and the percentage decrease/increase calculated.(Figure 1)
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