A recent report by Knowledge Networks found that social media doesn’t drive purchases — or at least, that customers don’t think it does. The survey results indicated that less than 5% of social media users say they regularly turn to social media for guidance on purchase decisions, and only 16% of social media users say they are more likely to buy from companies that advertise on social sites. Some blogs are citing the report as evidence that social media doesn’t drive purchases, chalking social commerce up to no more than hype.

The fact is, social commerce is about much more than a corporate brand presence on Facebook or Twitter. Successful social media marketing is about soliciting structured feedback relevant to shopping and buying, and making this feedback available to customers making purchase decisions.

Getting useful feedback on your product and brand

The first step to driving sales through social media is to build a collection of rich, structured feedback relevant to your customers. Enable customers to contribute their experiences with your brand and products, and reward them for their contributions.

Jon Nordmark, founder and CEO of eBags, had a number of useful insights on encouraging contribution at this year’s Social Commerce Summit. Jon found that while promotions are always a great way to drive reviews and traffic, a simple “thank you” can turn a one-time reviewer into an influencer. Recognize your top reviewers individually and on your site to keep them contributing and encourage new reviewers.

Making feedback available to shoppers making purchase decisions

Once you have relevant feedback, place it where your prospects will be influenced by it. Input and opinions from people like them help consumers cut through the clutter and find what they’re looking for. Including ratings and reviews on product pages allows customers to read about products in their own language, building trust in your offering and encouraging shoppers to buy.

David Tice, Vice President and Group Account Director for Knowledge Networks, drew an important conclusion from the social media study. "Social media users do not have a strong association between these sites and purchase decisions,” Tice said. “They see them as being more about personal connections – so finding ways to embrace that powerful function is key.”

While consumers may not get on Facebook looking for ads or corporate profiles, their peers’ opinions do influence them. Customers want the opinions of people like them; leverage their personal social networks to promote your brand. ShoutIt! allows customers to easily share their reviews and feedback with their existing social media networks. Customers can then promote their opinions to those they influence most – their networks of friends on their Facebook, Twitter, Digg, and del.ici.ous accounts.

Bazaarvoice clients know firsthand the positive impact of user-generated content on sales. Your customers are your best marketers; empower them to make social media work for your brand.

At Bazaarvoice, we don’t think of search in terms of just search engines. To us, “search” includes any way that consumers look for information, anywhere along the consideration or purchase path.

Social Amplification is a big part of this. Social Amplification is about extending your user-generated content beyond your site, wherever people congregate and influence others. This content is found on Facebook or in shopping portals, but it drives traffic right back to your site.

For example, ShoutIt! is a capability available for all Bazaarvoice products that lets consumers easily share their review, answer, or story on their own Facebook or MySpace page, or in their Twitter, digg or del.icio.us accounts.

One way shoppers are influenced is by people like them – or like they aspire to be – on their favorite sites. They read reviews, look for people like them, then visit that profile to discover other products this person reviewed and enjoyed. Deploying profiles helps companies amplify search within their own sites. A great example of this is how Free People highlighted their Top Reviewer on their blog. Now Christina influences Free People shoppers every day.

At Bazaarvoice, we firmly believe that searchers and shoppers will find information to fuel their buying decisions on their own terms – it’s about creating flexibility, not walled-garden destinations. That’s why we help our clients amplify their user-generated content so that users can find it where they want to find it – and where they are already looking.

Learn about our holistic view of search in our blog that introduces our Social Search Framework, and read our overview of technology that Bazaarvoice clients use to increase their search results.

We recently launched a new client, Mighty Leaf Tea, a specialty tea company “born for the sole purpose of infusing life into an ancient indulgence by creating tea products that reach new heights of quality and innovation.” They are truly passionate about finding the best handcrafted teas in the world – just try some and you’ll see.

While not a huge company, they are very hands-on when it comes to maximizing their Ratings & Reviews solution. They’re already very engaged with their Community Manager, who is helping them create campaigns to build review volume, setting up analytical reporting to track ROI, and talking about using customer feedback in their marketing campaigns.

This innovative company is also adopting several  Ratings & Reviews features, including…

TagShare, where their customers can summarize their opinions with searchable  tags
QuickTake, so their customers can quickly scan tags, pros and cons for a more cursory view of reviews
SearchVoice Reviews creates a single portal where all product  reviews can be found and maximizes SEO value. See theirs here.
ShoutIt! allows their customers to share their reviews, products and profiles on social networking sites like Facebook, Digg, and Del.icio.us
Ratings snapshot – allows customers to visualize the distribution of ratings across products

Brett, our CEO, has long been a big fan of Mighty Leaf Tea and we’re proud to welcome them into the Bazaarvoice family….and to serve their teas in our kitchen. They’ve been a big hit both in our Austin and London offices and their positive word of mouth is spreading fast. They even create fun green tea leaves to denote their ratings, instead of stars…

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Now Chris and Wired strike again with a preview of his new book, "Free", which is due in 2009.  The cover article of this month's Wired is "Free! Why $0.00 Is the Future of Business".  If you want to read now what everyone will be talking about next year, read this article now.  It isn't worth me summarizing here – trust me, it's worth your 15 minutes to read the entire article by clicking the link above.

Free is a very powerful word-of-mouth driver, and Bazaarvoice has certainly placed a lot of "bets" in this area.  Currently, the following Bazaarvoice solutions are free (to at least one stakeholder):

• ShoutIt!: Share your review on Facebook, digg, and Del.icio.us – free to clients and users; creates a form of advertising without the taint of being advertising
• SyndicateVoice: free for shopping comparison portal partners, free for new clients for a period of time; creates a form of advertising without the taint of being advertising
• BrandVoice: free high-converting user-generated content for clients from the customers of their manufacturing partners; leverages the power of channel marketing, which has existed since the dawn of vendors selling through the retail channel
• Ratings & Reviews, Ask & Answer, Stories: free for users; gives them the context they need to make a purchase decision as well as connect with other customers; consumers used to pay for this type of content from people like "Consumer Reports", or by physically driving to a store to speak to an in-store sales person who may or may not have the information and context that they need

I look forward to seeing how Chris's new book shapes up, and I have no doubt that it will be impactful.  As he so eloquently describes in this article, free already surrounds us due to near free transistors and bandwidth.  As more businesses transform to be information-based, this trend will radically accelerate.

How are you using the power of free in your business?