This Is How Retailers Are Using Social Media In Stores To Drive Sales

Cooper Smith Jul. 4, 2014, 11:13 AM

BI Intelligence

 

Social networks do not drive a lot of e-commerce sales directly (see chart), but they do influence shoppers by helping them discover new products to buy. Now some retailers are leveraging that influence to drive sales in stores. 

 

Nordstrom recently announced that it's installing video monitors in more than 100 of its stores to display products being shared on social shopping app Wanelo. "It's a purely customer-driven strategy," said Bryan Galipeau, Nordstrom's social media director, in a press release. "We take a snapshot of that trending category once every week, and we will then match that up against our inventory and what's available in those stores so we're providing a good customer experience." 

 

Brands such as Sephora and Lululemon are now using Wanelo and other social networks to keep tabs on women's fashion trends. A recent report from BI Intelligence noted the following stats about how social drives sales:

• Facebook influences 30% of American women when deciding what professional clothing to buy. Pinterest influences 22%, according to a joint study by Netbase and Edison Research. 
• When it comes to clothing for a special occasion, Pinterest influences 28% of American women and Instagram influences 17%. 

 

BI Intelligence

 

In the BI Intelligence report, we analyzed the data and spoke to leaders in the social commerce space to understand how their companies are adding value at different stages of the retail and e-commerce "purchase funnel," the long process that ultimately leads to a retail sale.

 

Some of the latest trends include building social networks around e-commerce platforms, partnering with brands, and otherwise transforming social commerce's strengths for Pinterest-style digital window-shopping. The report looks at the most important way retailers are leveraging social engagement to drive purchases. 

 

Here's how social commerce companies are driving sales: 

• It's not about click-to-buy: Social commerce is not simply transactional — it's not just about offering a click-to-buy link next to an offer on Facebook. Social commerce will never be what some have wanted it to be, an "Amazon killer." 
• What will help social commerce grow as a sales driver? The key is to help connect the funnel end-to-end, or to connect different mediums — say, social media and TV — to help coax a consumer down the funnel. 
• There are a few ways to encourage purchases: Retargeted advertising may be one missing link. It enables social commerce to connect the sales funnel from end-to-end by serving ads that remind users of products they have browsed across the Web but have not yet purchased. Facebook has made huge strides with its retargeted efforts.
• Also: Clever merchandising and user interfaces allow for sticky merchant-to-consumer relationships that can help nudge a consumer toward purchase over time. 
• Finally, referrals shouldn't be discounted: Another solution is for social commerce to develop as a sales referral engine, and take a cut of the sales. If social commerce sites have a large enough audience, even a low referral and conversion rate will result in a good revenue stream.

 

In full, the report: 

• Explains how time-sensitive offers on social media can motivate users to snap out of casual browsing or social media-grazing and into a buying mood
• Includes interviews with three social commerce industry leaders
• Discusses why Twitter has a unique opportunity at the bottom of the funnel
• Looks at Pinterest's prospects as a top-of-funnel platform
• Reveals average order values and order volume for a leading social commerce platform
• Breaks down the share of social media-generated e-commerce sales for each social network
• Looks at the demographics of social commerce consumers
• Compares Twitter, Facebook and more traditional digital methods of retail customer acquisition such as search engines

To view the original article please visit: Business Insider

 

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The new shopping behavior that is creating big challenges for the retail industry

Shoppers browse merchandise at an Old Navy store in San Francisco.(David Paul Morris/Bloomberg)

By Sarah Halzack February 11

Think back to December, when you were in the thick of your Christmas shopping.  How did you pick out that perfect scarf you put under the Christmas tree for your sister?  How did you know you got a good price on those Beats by Dre headphones for your nephew?

If you’re like most shoppers, the answer is likely that you did plenty of research before opening your wallet.

The Web has made it easier than ever for consumers to make price comparisons and to access product reviews, and that has meant that today’s shoppers are frequently armed with reams of research by the time they pull the trigger on a purchase.  And they’re not making impulse buys like they were in the days before the recession.

This dynamic is creating major challenges for retailers, who must now figure out how to thrive in an era when the consumer is ultra-knowledgeable–in many cases, more knowledgeable than the store’s own sales staff.

A new study of U.S. consumers, conducted by professional services firm PricewaterhouseCoopers, shows just how prolific this shopping behavior is becoming.

In its annual shopping survey, PwC asked shoppers how likely they are to conduct research before making specific types of purchases, including everything from jewelry to toys to clothes.   As you can see in the chart below, the share of shoppers who did not conduct research was already fairly small in every category back in 2013.  But more striking is how much the figure decreased in every category in 2014.  In each case, significantly fewer shoppers are not researching before they buy.

Chart Courtesy of PriceWaterhouseCoopers.

This may not seem especially surprising if you remember the “showrooming” panic that became a fixation for brick-and-mortar retailers several years ago.  Back then, they were worried that shoppers were coming into their stores to try on or test out merchandise, only to go home and purchase them online from Amazon.com or another e-commerce competitor.

But that perceived threat hasn’t quite materialized the way many retailers expected.  In fact, the PwC survey, along with many other recent research studies,  suggests that “showrooming” is far less common than its opposite, a practice the industry has dubbed “Webrooming,” in which people browse online before ultimately going to a store to make a purchase.

Chart courtesy of PricewaterhouseCoopers.

So here is the gauntlet that consumers have thrown down for retailers:  They continue to want to shop in physical stores in large numbers–for now, only about 7 percent of purchases in the U.S. are made online.

But by the time they get to the store, shoppers already know exactly what they want, and they want to get in and out of the store quickly.  And this attitude makes it extremely hard for retailers to upsell them on a fancier kitchen mixer or persuade them of the merits of buying a protective case for their smartphone.  And it makes it hard for them to provide outstanding customer service, since store clerks now have to assist shoppers who might are already be experts on what they’re buying.

The silver lining in this data for traditional retailers is that it makes clear that stores are hardly becoming an obsolete part of the shopping process.  In many of the categories above, including grocery, sports equipment and even consumer electronics, more than half of consumers want to visit a store at some point in their path to purchase.  And so even in the digital era, those expensive store leases are still playing a critical role in driving sales.

To view the original article please visit: The Washington Post
 

Todays Millennial Consumers May be Picky, But They're Loyal, Too

Millennials may be down, but they're not out. See how this key demographic spends its Benjamins.

By Vicky Castro

 

@vcastro_medill

Image: Getty Images

 

It’s well known that Millennials were among the hardest hit by the economic downturn these last few years. And while it’s taken a toll on their financial strength, young people remain a key consumer base--and how they spend their cash should be top of mind for any customer-facing business.

 

That’s the focus of a new survey from Elite Daily, an online publication known as "The Voice of Generation Y," and Generation Y researcher Millennial Branding. On the whole, young people are eager to spend on technology like smartphones and cars versus, say, shelling out for a mortgage. As far as shelter goes, they would prefer to rent, according to the survey, which polled more than 1,300 Millennials in October 2014.

 

For this group of consumers, not only is brand loyalty important, but it is earned through product quality, a good customer experience, and the brand’s support for society. While 60 percent of respondents said they are often or always loyal to brands that they currently purchase, nearly half said the quality of the product is the most important attribute in a purchasing decision--more than twice that of price. And despite growing fears that all Millennials are all selfie-taking narcissists, 75 percent reported that it is either fairly important or very important that a company gives back to society instead of just making a profit.

 

A good customer experience and a “quality product” are the two most cited reasons for what influences Millennials to share information about a brand online. Sixty-two percent say that if a brand engages with them on social networks, they are more likely to become a loyal customer. Forty-three percent say Facebook is the social network with the most influence on their spending habits, followed by Instagram at 22 percent.

 

“If you want to connect with Millennials, then you’re going to have to rethink the way you advertise and market your product to them,” says Dan Schwabel, founder of Millennial branding. “Instead of traditional advertising, which they ignore, brands have to publish authentic content as a way of building trust and loyalty with this extremely important and influential demographic.”

            

 

 

To view the original article visit: http://www.inc.com/vicky-castro/todays-millennial-consumers-may-be-picky-but-theyre-loyal-too.html