Retail: The Give And Take of Social Media

As social media proliferates, pretty much every retailer is looking at how they can ”ride this wave” to their advantage. But while many retailers think of it as just another channel to advertise to your customers, social media can be so much more.

That’s because social media enables retailers to both listen to their customers and engage their customers. And that balance—the yin and yang, the give and take—is what’s required for retailers to realize social media success.

Can I hear you now?

In many ways, social media is an always-on focus group. Let’s say you’re a seller of women’s apparel. You see a cluster of tweets in which customers lament they can’t find the right size or don’t like the new colors for the fall season. You just got advance notice of what your point-of-sale (POS) reports won’t tell you for another month. You can take instant action to change the product mix at the retail storefront.  The reverse is also true… if your inventory control system is reporting an ‘out of stock’ on red dresses, but an overstock on black dresses, your social media campaigns need to adapt in real time to reinforce that ‘a girl can never have too many black dresses for the holiday season’.

Not only that, but you can also cross-tab social-media data by gender, age, those who shop on weekends, non-customers versus loyal customers, and so on. In fact, that’s a perfect example of Big Data in action—millions of bits of data that, with some sophisticated analysis, can reveal true insights. Once you have that, you can begin to understand how pricing, merchandizing, and couponing strategies can alter your customer experience and your margins.

Talking back

Social media also enables you to directly engage your customers—and increasingly, your competitors’ customers. Let’s say a customer tweets that she’s upset she left a competitor’s 20 percent-off coupon at home (which of course you would notice as you’re monitoring conversations about your competitors , aren’t you?) . That’s your opportunity to send a tweet direct to the customer with your own 20 percent-off coupon.

In fact, one of the most valuable aspects of social data is that it’s “living” . It’s a point-in-time data source, but because it’s unique and personal, it lets you measure unique trends over time. For example, you can launch an initiative to grow “share of voice” of a specific customer set, and measure precisely how your actions and engagement efforts influence those people over time.

That’s very hard to do with other data sources. And it’s what allows you to build a “target segment of one” to optimize customer experience for each individual customer.

Cloud computing, data analytics, and in-memory computing are crucial tools in combining and leveraging that social data with POS data, loyalty data, and syndicated data. Most retailers already have far more data sets than they ever anticipated. But they aren’t achieving the insights they could and should. Enriching those data sets with the million bits of social data requires thoughtful planning on the back end, where the data is stored, and on the front end, where it’s visualized.

Look before you tweet

For all its advantages, social media carries potential downsides. One is that as long as customers are interacting on Facebook or Google+, much of their data remains locked in Facebook’s or Google’s servers, and creating an environment where much of your most valuable data isn’t even something that you ‘own’. Some retailers might consider creating private (so called ‘owned’) social platforms where customers can engage—and where you can access their data and engage the customers directly in exchange for value you provide them.

To that end, never expect your welcome to extend beyond the terms of your relationship. Let’s say a customer “likes” your branded line of tools. He probably wants to be kept in the loop on your new ratchet set. But he doesn’t want to get involved in your company’s political conversations about immigration, minimum wage, or civil rights – no matter how noble they might be.

More important, never let your social activities cross the line into creepy. Perhaps you can aggregate data from a customer’s loyalty card, purchases, and social activity to determine with 100 percent certainty their income, marital status, and political views. That doesn’t mean you should. There has been ample media coverage of companies that became too invasive in the collection of data.

The customer you keep

Many of your customers are actively communicating on Facebook, Twitter, and other social platforms. If you aren’t managing your social media presence, they may be doing it for you. If a customer repeats a completely erroneous allegation that you sell products made with child labor, for example, you have to be part of the conversation if you want to control the damage.

At the same time, don’t look to social media solely to engage your “complaining 10 percent.” Yes, you need to respond to customers who have had a negative experience. But what about the customer who refers to your coffee chain by tweeting, “Just ordered my favorite latte at my favorite cafe!”? You can respond, “And we love seeing you, too!” Customers who are acknowledged by the brands they love deepen their loyalty—and can become your best ambassadors.

It’s all part of the give and take of social media.

Turn Facebook into a Point of Sale

Wow Bao, a Chicago-based Lettuce Entertain You Enterprise, Inc. restaurant concept specializing in steamed Asian buns, announced the launch of a new “Online Ordering” tab on its Facebook page that allows fans to order their takeout or delivery meal right from the social media site. The application was developed by Exit41, a leading provider of web, mobile and call center ordering applications and services for the restaurant industry.

“With the addition of our Online Ordering tab on Facebook, we’ve just made it even easier for our most loyal fans to order our food,” said Geoff Alexander, vice president and managing partner, Wow Bao. “This is a tremendous opportunity for us to really engage with and reward our fans, plus attract new fans with the powerful, viral nature of Facebook.”

On Wow Bao’s Online Ordering tab, fans can browse a variety of the restaurants’ most popular menu items (everything from BBQ Pork Bao to Homemade Fresh Ginger Ginger Ale), easily add selected items to their cart, and then seamlessly complete the transaction on the Wow Bao online ordering site. The application features real-time integration with the restaurant point of sale system for up-to-date pricing, taxes and menu item availability.

Exit41 will be launching Facebook ordering for its restaurant customers, which include some of the world’s leading fast casual, casual dining and fine dining brands.

Exit41 also has aggressive near-term plans to enhance the application with features including the ability for fans to share their favorite menu items with their friends, “Like” them, and find “Top-Liked” products across their network, and the ability for restaurants to instantly reward fans based on their order frequency.

“Adding online ordering to their Facebook page opens up a huge opportunity for restaurants to gain exposure to the millions of Facebook users,” said Joseph Gagnon, chief executive officer, Exit41. “Think of it — there is nothing more social than food and with this enhancement we have now fully integrated the restaurant into the social graph.”

Facebook Tests New Mobile Payments System

Facebook is in the early stages of testing a new payment system that would store users’ credit card information for use in mobile transactions, but would not complete any transactions directly. Instead, the system would complete payments through third parties such as PayPal.

Why does Facebook want to store a user’s credit card information if it is not conducting any actual transactions? According to a statement from the company, this process “gives people the option to use their payment information already stored on Facebook in a mobile app.” Their goal is “to make it easier and faster for people to make a purchase…by simply pre-populating your payment information.”

This payment system is in the very early testing stages, but remains a significant move because it takes Facebook yet another step closer to being an all inclusive site, one that hordes an individual’s every data point and effectively connects all people to everything all the time. Have you noticed how you can often choose to “log in through Facebook” when logging into a third party site? Even if you don’t want to have your Facebook account linked to the other site, it’s tempting because to select that option is so much easier than creating yet another online account. This mobile payment thing is just like that—but with credit card data.

Facebook frames the move as a way to “help apps provide a simpler commerce experience.” But it’s obviously about more than just alleviating the annoyance of having to enter one’s payment data on a mobile device. It’s also about collecting user data and about attracting advertisers. The more Facebook knows about each user, the more the company can tailor individual experience, including—and especially—advertisements.

What does this mean for business owners? If the payment system expands and becomes a regular Facebook feature, it could mean that your customers will have a simpler path to completing mobile payments—because have you ever met anyone with a smartphone who isn’t constantly logged into Facebook?

Currently, Facebook is testing this new payment system with a single flash-sale shopping site called JackThreads. Will the test be a success? That obviously depends on many factors, including users’ willingness to trust Facebook with their credit card information. Personally, the thought makes me uneasy—but as addicted as I am to Facebook, I’m still something of a holdout when it comes to the social network; I don’t even list my hometown or the kind of music I like in my profile. But that’s beside the point. The point is that Facebook is making a push into mobile payments, leaving the rest of us to wait and see how this test goes and what move the company decides to make next.

Social Media & Business Strategy

Saw this article in the Straits Times newspaper so thought of sharing with you all. Social media was the hype years back and people were generally skeptical if it would work for businesses. After a couple of years, we can see more and more companies embracing it. However, it’s not about jumping in and be all over the place. One must still define the objective(s) of engaging social media and there must be plans lay out and executed step by step. Happy reading!