The Importance of Social Media in Business

Written by Micah Shin on Saturday, 09 July 2022. Posted in Business Analytics

Illustration by Sophia Liang for Girls For Business


As most companies have transitioned into the online marketplace since the pandemic, the popularity of new business models has emerged. Over the last two years, e-commerce sales have surged by over $240 billion, or 40%, compared to pre-pandemic statistics. As a result of state legislation, the retail industry has evolved. Brick and mortar stores have capitalized on the convenience of online shopping and at-home delivery. 

Online marketing, mainly through the use of social media, has played an integral role in the success of businesses that have taken their storefronts online. Creating a social media presence has catalyzed an increase in sales and customer base. In fact, 55% of consumers discover new brands through social networking sites. Now, companies that do not utilize social media are at a disadvantage, as consumers are more likely to engage with and purchase products from competitors with active accounts. One survey found that 68% of consumers agree that social media has allowed them to communicate directly with brands. This marketing method, unlike traditional advertising, is not one-way media. Companies are able to foster relationships and enhance the consumer experience through personalization and responsive customer service. A positive experience with a company on social media helps generate sales; nearly 80% of people are willing to purchase products from a company after having a positive interaction with it through social media. This aspect of online marketing strengthens brand loyalty, as followers are more likely to recommend and choose a brand over a competitor after engaging with it. The majority of consumers also believe that companies need a social media presence in order to thrive over the long term.

Data collected from social media is used by over 70% of companies in order to make informed business decisions. Analytical features on these sites provide insight into what content or products people prefer, allowing brands to differentiate themselves from competitors and improve the inventory they offer. Targeted content also helps brands reach individuals who are likely to be interested in making a purchase from a specific category of companies. The implementation of social media in marketing strategies is not just limited to targeted ads. Businesses are able to convey their stories and grow an audience with a relatively small budget. It is free to create a page, and most companies grow their platforms by simply posting consistently. Rankings and impressions can be enhanced through the use of search engine optimization (SEO) content. SEO content includes trending keywords, hashtags, designs, and formats. Thus, companies can reap the benefits of effective advertising without paying for premiums such as advertising tools. 

Social media is also important for competitor analysis. Business profiles across these platforms are public, allowing companies to research their competitors and learn what strategies they use to attract a wider audience. Above all, digital marketing increases a company’s overall return on investment. Companies can reduce costs for advertising, while reaching hundreds of thousands of potential customers.

About the Author

Micah Shin

Micah was a Business Analytics Writer at Girls For Business.

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