Brian Kilcourse, Managing Partner
December 8, 2009
Back in August 2008, RSR partner Paula Rosenblum rhetorically asked, “Social media … is it anything?” But in a remarkably short space of time, social media has turned from a technical curiosity into a marketing imperative. According to a recent National Retail Federation study, “… 47.1 percent of retailers surveyed will be increasing their use of social media this holiday season. More than half of retailers said they have added or improved their Facebook page (60.3%) and Twitter pages (58.7%) this year”.
Two big challenges are before retailers as they learn how to use social networks to their advantage. The first seems obvious – learn how to advertise via social media. The second is not quite so clear: how to turn consumer sentiment expressed via social media into a useful indicator of demand? The second challenge will require technology to turn unstructured data into something consumable by retailers’ business intelligence systems. The first just requires a little ingenuity to get started.
One of the most innovative examples so far this holiday season was launched for an IKEA store in the southern Swedish town of Malmo, just across the Õresund Strait from Copenhagen, Denmark. Store manager Gordon Gustavsson hired an advertising agency to create a Facebook profile for his store. Over a two-week period, images from IKEA showrooms were uploaded to his Facebook photo album. Then a message went out over the social network to say that the first person to tag their name to a product in the pictures would win it. As a result, thousands of Facebook users spread pictures of IKEA showrooms to their network of “friends”. For a few free items, the IKEA story spread throughout the Internet as a brilliantly simple and creative example of how to create some buzz.
A New Lead-Gen Engine
But such an example might also seem a little frivolous – what’s the lasting value of the idea? RSR’s take is that social media represents a new way for retailers to use technology as a lead generation engine for their total value offering. The viral nature of social networks can enable a single person to trigger thousands or even millions of impressions. But unlike other forms of media, it’s a direct and two-way conversation. In a social network, the consumer is not anonymous. Retailers can not only know that she has clicked on certain content (as search engines like Google and Yahoo do), but also her name, where she lives, her age, specific areas of interest, and even what she looks like. And consumers with common areas of interest can find each other easily and exchange points of view. This is what technologists and analysts are calling “the network effect” – and it’s potential for good or ill is profound.
How to Begin?
Of course, as in real life, the best way to have a conversation is to start one.
For retailers who haven’t begun experimenting with the two-way communications capabilities of social media networks, an obvious question is, “how do we begin?” The question should be answered as part of the retailer’s overall cross-channel marketing strategy. Issues that need to be addressed include:
· One, a few or many social media networks? Which ones?
· What are the intended objectives of the engagement? Promote the Brand (eg. community involvement)? Product promotions? Special one-time offers? Employment opportunities? Employee support? Customer support? Special services? Corporate communications?
· Organizationally, who will “own” social media communication?
· How will “success” be measured?
· Will IT support be required?
· Will there be involvement from internal support organizations? What level of involvement?
· How will we separate out the “noise”?
Listen
A second important aspect of any good conversation is in listening. Retailers need to decide up-front what they will do with the direct feedback that they get from social media. Like any other data, this new information must be processed. For example, where do employee complaints go to? Customer complaints about products? About services? Suggestions? Corporate inquiries?
Just as in face-to-face communications, responses to social media can come in three flavors:
· Competitive listening (not recommended): where the listener is more interested in his/her own point of view than the other party’s;
· Passive listening: where the listener absorbs but does not verify the message; or,
· Active listening: where the listener engages, feeds back and verifies the message and commits to follow up.
In the case of the business use of social media, retailers should develop use cases based on the objectives that have been established for the two-way communications.
Begin to Develop a Roadmap
As experimentation with social media evolves, retailers need to begin thinking of a future scenario where social media sentiment is interwoven into the business as customer insight. One way to approach developing a roadmap is to map input from social networks to the internal business processes and the people who execute those processes.
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