Most of the advertising on Social networks aimed at Millennials is a waste of money. New research indicates that 71% of Millennials are not likely to buy from targeted, paid advertising that comes in their social network feed. Instead, they will buy from brands they like.

Thus, it’s essential for marketers to create Social Commerce programs — the intersection of e-commerce and social networking sites — that will increase engagement with this powerful buying group that recently surpassed Baby Boomers as the largest generation in the United States.

This latest study of Millennials from UMass-Dartmouth, is an in-depth look at current purchasing habits and trends of Millennials using three of the most widely used social media platforms: Facebook, Twitter and Pinterest. Instagram (owned by Facebook) was included due to its rapid rise in popularity among Millennials to explore its viability as a social commerce site.

Highlights of the Study

These are the key findings:

• Likes, follows and pins are significantly related to subsequent purchases on the platform. This makes brand involvement central to the sales effort on social networking sites.
• Even though Instagram is not yet an active social commerce site, 40% of Millennials follow companies/brands on the site. Great potential exists for buying products on Instagram.
• While companies move to increase their paid social initiatives, data is now available to indicate that 71% of Millennials are not likely to buy from targeted, paid advertisement that comes in their social network feed.
• Eighty-five percent of Millennials on Facebook and 80% of those on Twitter state the top motivator for liking or following a company/brand is to support the company/brand they like. Pinterest users are motivated to share interests/lifestyle ideas with others.
• Millennials are more likely to be converted to a sale if a coupon or discount is offered on a social networking site. While this study focuses on Millennial online behavior from liking, following and pinning companies/brands to making purchases (online or offline), we continue to inquire about the interest in “buy” buttons on Facebook, Twitter and Pinterest (which has experienced success with their buyable pins).

Facebook is the most popular Millennial platform for businesses with 56% of Millennials liking companies/brands on that site, followed by Instagram at 40%, Twitter at 17% and Pinterest at 14%.

When asking Facebook users why they “like” a company/brand, respondents said it is to support the brand they like, receive regular updates or get a coupon or discount.

Instagram Goes Native

As I wrote in a post two years ago, native advertising is designed to generate more consumer engagement, often through the use of celebrities or other influencers. The thinking is ads that seem to be part of the editorial content of a magazine or newspaper will have more appeal to Millennials and other buyers and increase their brand loyalty.

Since then, however, the Federal Trade Commission has issued warnings to dozens of brands and social media influencers for failure to clearly disclose their relationships with brands and products they’re promoting.

Just recently, in a move to be more transparent, Instagram announced that it will begin to roll out native advertising with a sub-head that reads “Paid partnership with.” This will make it clear to readers that the post they are seeing is actually paid advertising.

Will this detract from the brand? Will knowing that a post is actually an ad turn off Millennials? Will it reduce a buyer’s “liking” a brand?

It’s too soon to know, but brands will need to explore how they can engage Millennials, not only through social commerce, but offline in public relations and promotional campaigns.

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