Retailers, consumers and prices
This holiday’s shiny new toy: social media
Companies that cater to consumers are always chasing after the latest consumer technology trend (anyone remember Second Life?), and this holiday season that means following them into the world of social media.
Companies ranging from Wal-Mart and Panda Express to J.C. Penney and Target are experimenting with Facebook, Twitter, YouTube or Flickr. Some are tweeting special coupons or limited-time deals, while others are doling out fashion advice or providing play-by-plays from product launch parties on Facebook. M.A.C. said it is using its Facebook page to feature artists, color collections, and what is happening backstage at fashion shows.
While figuring out if all this tweeting, posting and friending is increasing sales is difficult, companies said one thing is certain: Social media is giving them a direct, unfiltered link to consumers.
For instance, when Target asked its Facebook fans what they thought of its mens clothing line, they got suggestions like: “MORE MLB, NFL, NBA merchandise…” and “Could use a better selection of mens jeans, and tall mens shirts (not just dress shirts) too.”
Target is now using the responses to tweak its merchandise selection.
When Panda Express wanted to celebrate its new SweetFire chicken breast, it allowed Facebook fans to print a coupon so they coud visit a restaurant on Sept. 25 and try it for free. Chief Marketing Officer Glenn Lunde said 25,000 coupons were redeemed and traffic in its restaurants rose that day.
Larry Weintraub, the chief executive of marketing agency Fanscape, said that unlike traditional media, social media can give companies tangible results.
“If I run a TV ad or I do a billboard … I don’t always know the direct effect,” he said. “If I do Facebook and there’s a coupon or a direct link to buy it, I actually see the results.”
Coach said it is luring shoppers to its stores and its website by using Facebook, Twitter and establishing relationships with influential blogs. For this holiday, it is developing an iPhone gifting application. Users can type in who they are shopping for, what that person’s favorite color is, and their price range. The application will respond with a bundle of possible gift ideas.
But Zain Raj of Euro RSCG Discovery said companies need to keep social media’s potential in perspective for this holiday. He pointed to Dell, which has said it raked in more than $3 million from Twitter followers who clicked through its posts to its Websites to make purchases.
However, Raj said that is “not even a drop in the ocean” for a company that posted $12.3 billion of revenue in the first quarter of this year, alone.