Brands are asking: What’s the return on social media?

Social media isn’t about producing sales today; it’s about driving sales in the future.

At this point, observers say, few brands, if any, are seeing significant sales result from their postings on Facebook, Twitter, Instagram, Pinterest and other sites. Social media hasn’t been about driving transactions; it has been about building brand awareness and a “community” that will be devoted to a brand years from now. As the Internet-crazed generation of twenty-somethings matures, they will remain loyal in purchasing the brand.

The majority of companies with a good to great social media presence can be found on the following platforms: Facebook, Twitter, Pinterest, Instagram, Tumblr, YouTube with e-commerce, a blog and often elaborate editorial content on their own websites. Burberry, Christian Dior, Chanel, Gucci and Louis Vuitton all having fan bases on these platforms that surpass 5 million. The more money brands put in to their social media efforts, the greater the pressure to show a return on their investment.

In an interview with WWD.com, Maureen Mullen, Director of Research forNew York UniversityLuxury Lab, or L2, noted that some brands have opted to invest in Facebook, Twitter, Pinterest and Instagram in favor of building a robust e-commerce site or search engine marketing. Mullen warns, though, that in the short term, a superior e-commerce business will generate more business for fashion brands than a “mediocre to good social media presence.”

Oscar de la Renta’s social media personality and Senior  Vice President of Marketing and Communications, Erika Bearman, has attracted nearly 150,000 followers on Twitter under her OscarPRGirl moniker. These fans may not be buying anything right now, according to Mullen, but in five to 15 years from now, most definitely.

“I don’t think it’s that far out. We would hope that through engagement — whether it’s through social initiatives or our [Web] site in general — we will develop customers much sooner. Initially, it was all about developing future customers, but how far in the future seems to be getting shorter and shorter,” Chief Executive Officer Alex Bolen said. 

Establishing a personal relationship with followers has been the brand’s social media strategy. A blog called George & Ruby launched last month Oscar de la Renta’s latest endeavor, centered around the children’s wear collection. The blog is written by Marissa Kraxberger, head of the company’s creative team. “It’s a demographic that we didn’t think made sense for me to speak to,” Bearman said, calling George & Ruby a personal account of Kraxberger’s life as a working mother of two. “I don’t have kids and we didn’t think it was realistic for our fans to hear about children’s clothing from OscarPRGirl.”

The social media approach is slightly different for contemporary priced brands, such as Kate Spade. Rather than using social media in hopes of forming a personal collection that will lead fans to buy, the brand effectively uses Facebook to gather pertinent data about its users.  This allows the opportunity to reach a specific market and target to them though e-mail outreach, according to Mullen, who sees this as viable evidence of ROI. 

Even though there still isn’t a metric to measure social media’s impact, platforms are popping up aimed at making social commerce. By seeking to empower consumers to purchase on Facebook, for example, it makes it worthwhile for companies that get involved.

For Zindigo founder Michael Bereck, the most important element is to really hone in on the notion of “direct social selling,” which sees a brand’s followers on Facebook facilitating in the promotion and selling of product on the medium. 

The technology allows users to implement a customized e-commerce experience with any of the more than 80 participating brands on their Facebook pages, with the ability to build a network of ambassadors. Bereck believes Zindigo allows brands to monetize social media with the platform agnostic technology (which upon its launch is only compatible on Facebook, but will roll out to other iterations in the coming months). Bereck even brought on board Kareen Mallet, who was the Neiman Marcus Group’s Senior Women’s Ready-to-Wear Director for 17 years, to serve as Fashion Director. Brands so far using the technology include Erickson Beamon, Be&D, Dallin Chase, Geren Ford, Kara Ross, Jay Godfrey, Ruffian and Isabella Fiore. 

The platform allows users to open a brand page and establish a new revenue model. Users are motivated by the commission made from items purchased on their brand pages — which is 40 percent — and all partners maintain administrative access to branded content. Content looks the same on each ambassador’s page (which has to be vetted by brands) to ensure individual brand consistency, although users can highlight whichever products they wish.