Are consumers following retailers to social networks?
The current economy poses many challenges for marketers and retailers. A Yankelovich Partners study (2005) found almost sixty percent of US customers find marketing to be irrelevant for them personally, and seventy percent are interested in products and services that would help block marketing attempts. Somewhat ironically, the same study also found that customers respond more favorably to marketing when they have control. Consumers are happier being a part of community, rather than the target of a marketing campaign (Cocheo, 2009). Consumers are more likely to buy something that is recommended to them, rather than when it is "marketed" to them; this is even more likely when the recommendation comes from someone that they trust.
Nielsen (2009) reported that global online video has grown 339% since 2003 and time spent viewing has increased almost 2000% In addition to the growth in the use of video, the number of online social media users has grown 87% since 2003, and the time spent on these sites has increased 883%. In the last year alone, (2008) time spent on social networking sites increased 73%. A large percentage (85%) of social media networking users want companies to interact with them using social media applications (Nail, 2009). A 2006 comScore Media Metrix report (Trusov, Bucklin, & Pauwels, 2009) indicated every second, online users in the US had visited at least one of the top fifteen social networking sites, and that approximately fifty social networking sites each had more than one million registered users. In 2007 Oser and Adepiju reported that 37 percent of the US adult internet population and 70 percent of teens used online social networking at least once per month. Predictions show that the total US social networking audience will grow to 105 million in 2011. According to Neilsen Online (2009) research, use of social networks and blogs is now the fourth most popular online category. Alex Burmaster, of Neilsen Online, stated "social networking is not just growing rapidly, it's evolving in terms of a broader audience, and compelling in functionality." One-third of Internet users report comments by consumers provided on the social media sites have been influential when they make a purchase decision, (Deatsch, 2009a), but just 11% considered advertising to be as effective. During the past year, almost half of Americans had consulted social media while shopping, and more than one-third, (37%), had done so in the past three months.
Based upon the usage rate and statistics, there is no question that retailers are quickly incorporating the use of social networking sites into their marketing communication strategy. The use of these sites became even more advantageous as many retailers implemented the benefits of the sites' applications during the holiday season in an effort to generate revenue during this struggling economy. Many have recognized that social networking is about linking people with common interests. Companies such as American Eagle, Gap, Ice.com, Victoria's Secret, Macy's and Nike have experimented and/or incorporated the use of social networking, (Reda, 2008). The challenge for companies is learning how to use social networks to the greatest benefit. Many retailers used such social networking sites as Facebook.com, discussed later, to utilize an application that the network labels "events". Retailers such as JCPenney and Macy's, created events to encourage customers to visit their online as well as brick-and-mortar sites in order to take advantage of special promotions and sales during a specified period of time.
Results of research conducted by a team of Fellows of the Society for New Communication Research (Barnes, Cass, Getgood, Gillin, & Goosieaux, 2008) found evidence to support the significance of social networking to current promotional mix decisions. Consumers 25-55 years old, college-educated, and earning $100,000 or more are among the most savvy and sought after consumers. The same group is using social media to research companies when making purchase decisions. While the economy has changed the way consumers shop, and how they spend, what has not changed is that consumers trust the opinions of friends and family, as well as people they do not know, usually more than anything the retailer has to say about the company or their products. Galeotti and Goyal (2009) purport that companies who use social media networking see higher sales and greater profits. Furthermore, Harridge-March and Quinton (2009) suggest that not only does social media networking allow for communications between consumers, but also allow retailers to develop a relationship with their customers, and therefore reduce churn. According to Mark Brohan (2009), while the economic downturn showed that online retailers were not immune to slumping sales, online sales grew by only a single digit rate last year. However, consumers remain loyal to online shopping, and as such, social media marketing provides an opportunity for retailers to develop a communication mix that is less costly, and reach consumers via a channel they want. The challenge for retailers is to identify how this digital word of mouth influences, as well as who the influencers are.
SOCIAL MEDIA AND RETAIL MARKETING COMMUNICATION
Internet Retailer's 2009 Top 500 Guide (GettingSocial, 2009) devoted an introduction to this year's report on the prevalence of online retailers' participation and use of social media networks. Approximately three-fourths of the Top 500 retailers had a presence on at least one social network by early April 2009. Facebook was the most popular, 57% participating; 41% having posted a video or commercial on YouTube; 29% were on MySpace, while 20% were linked to followers in Twitter. Finally, 10% were on the social shopping site, Kaboodle.
Owyang (2008) reported that more than 120 million active users made Facebook the fourth most-trafficked website in the world. It is visited by 3 in 10 people monthly ("Two-thirds of the global online population visit social networks and blogs," 2009) and has more than 75 million members in more than 80 countries (Leader-Chivee, Hamilton, & Cowan, 2008). Facebook reports that there are more than 28 million pieces of content (web links, news stories, blog posts, notes, photos, etc) shared each month. With this level of activity, it is no surprise that a recent study of social media ("Social Media Study Shows 59 Percent of Retailers Now Using Facebook ", 2009) found that up to 59% (59 of leading 100) of retailers are now using Facebook through the use of fan pages. These retailers have recognized the need to focus on what customers are looking for on a site, what the company wants to communicate, and the role the fan page can play in communicating their message. The actual number of retailers on Facebook doubled in only five months (Wagner, 2009). The 2009 Internet Retailer's Top 500 Guide shows that 56.8% of all retailers, or 284 companies, had a presence on the social networking site Facebook.com, including 70 of the top 100 ("More than half of 2009 Top 500 e-retailers have a presence on Facebook," 2009).
Kaboodle was launched in 2005 when Manish Chandra and his wife grew frustrated trying to buy home improvement products (2009). Because they believed shopping is a social process, the social shopping site Kaboodle was developed, where consumers can find, recommend and share products, sources for products, and other relative shopping experiences. As of fall 2009, Kaboodle has over 14 million monthly visitors, and 900,000 registered users, who had added 10 million products to the site. In mid-year 2006, Kaboodle simplified the process of adding products to the website by creating an "Add to Kaboodle Wish List" button for retailers to add to their respective web sites. Kaboodle launched a holiday portal in 2008, Holiday Kit 'n Kaboodle (O'Grady, 2008). During the 2008 holiday season, Kaboodle boasted more than 260,000 vendors, and was considered one of the top 25 Networking media companies.
MySpace is a regular destination of approximately 55% of teens (Maughan, 2007) and links 100 million users in more than 20 countries (Leader-Chivee, et al., 2008). As more young people choose online communication and social media, they want to share via text messaging, email, and now social networks like MySpace, the things that are important to them and their friends. According to Jeff Berman, (Newman, 2008) president of sales and marketing for MySpace, TJ Maxx and Target have reached consumers effectively, based on an expressed interest in fashion or a specific genre of music. These applications provided increases of up to 300% when compared to standard demographic targeting. Another example of company response to effectiveness of social media is Wet Seal's addition of a community when it noticed 15% of its traffic was coming directly from MySpace (Deatsch, 2009a).
While MySpace has been the largest social networking site with regard to ad spending, things have changed drastically in the past few months (Williamson, 2009). From October 2008 to March 2009, traffic fell 8%, to 70.1 million people, while Facebook's unique visitor numbers grew 33%. Current indicators suggest Facebook is poised to replace MySpace, however, demographic differences may be substantial enough on MySpace for more targeted strategies to remain effective for some retailers. By December 2009 ("MySpace Tumbles from the Top," 2010), Facebook had garnered 47% of the social media market share, while MySpace fell to just 18%.
Twitter attracted 14 million unique visitors in March, 2009, compared to only 1.1 million a year earlier (Deatsch, 2009b). This social medium has exploded so quickly that online retailers have just begun to consider how this medium could be used effectively to communicate with millions of potential customers. The key to making Twitter effective for a retailer is to get users to sign up and "follow" the retailer. Retailers must learn how to entice these followers by creating a 140-character statement that will be displayed on the retailer's Twitter page. In order to make Twitter a more successful tool for retailers, the website has introduced a guide to doing business online (http://business.twitter.com/twitter101/). Thus, updates on popular products, special sales or discount offers might turn low volume Twitter traffic into a high-value communication channel. For example, Delight.com reports a conversion rate 15% higher than average, and order size that is 20% above average. This site had 100,000 unique monthly visitors generating about $1 million in sales during 2008. Twitter Tweeters comprise about 8% of the US online population (Bernoff, 2010), while another 4 percent are considered to be lurkers. More importantly, a significant proportion (95%) of Tweeters are members of other social networks such as Facebook. BestBuy has established the Twelpforce for customer and technical support, not to generate sales, and it is has been very effective to date.
Dell began using Twitter in March of 2007, and now has more than 11,000 followers. While most social network participation is about brand-building, Dell has effectively used Twitter to generate sales and revenue (Williamson, 2009). By using Twitter-only promotions, Dell reports more than $1 million in sales over the past two years from the network (Wagner, 2009). While the original intent was not to generate immediate sales, this social network has proven to be a financial boost, as well as providing Dell the opportunity to be part of consumer conversations. Dell's strategy has been to be upfront about the purpose of the Twitter account. It is important to get consumers' interest before hitting them with marketing messages. Thus, it is important to follow what is being said about the company. On Twitter, they can offer consumers advice and generate good will, along with generating publicity.
Reda (2008) found YouTube participants to be engaged, capable of influencing purchases of others, and seeking online opportunities that offer rich entertaining experiences. Users of the social networking sites actually control and determine what is the most popular. Jones (Jones, 2009) found YouTube to have about 258 million users logging in weekly. According to the YouTube site, the average user base is broad in age range, 18-55, evenly divided between males and females, and spanning all geographies. With such a large and diverse user base, YouTube offers something for everyone (YouTube, 2009). Internet Retailer reports 41% of top e-retailers have placed a video on YouTube or are mentioned in a video posted by users ("More than half of 2009 Top 500 e-retailers have a presence on Facebook," 2009). Sonia (Sonia, 2007) reported online video through social media sites such as YouTube as the most used social networking tool (65%).
PURPOSE OF RESEARCH
It seems that we are becoming a nation of social media users (Patel, 2010), with 80% of online users reporting they had visited a social site, and 59% calling themselves active social network users. The search for information about new products, sales and discounts are the primary reasons people follow brands, retailers, consumer packaged goods and technology. Almost half (46%) of social media users had recommended or talked about a product or brand on Facebook, and a similar number (44%) had done so on Twitter (Palmer, 2009). A third of social media users thought social networks were a good place to seek company and product information. More than one fourth (27%) indicated they were receptive to invitations to events, special offers or promotions received through social media sites. Given the state of the economy during late 2009, the researchers were particularly interested in investigating just how successful retailers might be employing social media marketing (SMM) in their marketing communication strategy, during the all-important holiday season. Based upon the previous review of literature and social media discussion, the following research questions were developed:
1 What top retailers used social media during the Holiday 2009 season?
2 Which of the prominent social media networks did top retailers employ during the Holiday 2009 season?
3 Which top retailers employed multiple social media networks in their Holiday 2009 marketing activities?
4 Did multi-channel retailers use multiple social media networks?
5 Did the social media network employed by top retailers differ based upon the merchandise category sold by the retailer?
6 Did top retailers increase activities or events on the social media networks as the Holiday 2009 season progresses?
Four sources of top-rated retailers were used to identify the companies to review: Retailer's Top 500 Guide, Stores' Top 100, Hot 100 and Favorite 50 lists. The retailers that appeared on each of these four lists included: Amazon Inc., Apple Inc., Barnes & Noble.com, Best Buy Co., CVS Corporation, Dell Inc., Gap Inc. Direct, Home Depot Inc., JCPenney Company, Staples Inc., Target Corporation, and Wal-Mart.com. These 18 retailers were reviewed for participation on each of the five social media networks. Five social media networks were identified as the most prominent in the current retailing literature: Facebook, Kaboodle, MySpace, Twitter, and YouTube. Means to measure the degree of participation or consumer involvement with a retailer on each of the social media networks varied across the different social media:
* Facebook included the number fans, discussions, notes, and events
* Kaboodle measures included fans, comments, products, and promotions
* MySpace included friends and comments
* Twitter included followers and tweets
* YouTube measures included views and subscribers
Counts for each of the above measures were taken weekly from the first week of September, 2009 through the first week of January 2010, for each of the 18 retailers on the respective social networks where they had presence.
All of the 18 retailers had a presence of Facebook. Only two, JCPenney and Macy's participated on Kaboodle. Three retailers had a presence on MySpace, Dell, Kohl's, and Lowe's. Best Buy, Dell, Home Depot, JCPenney, QVC, Sears, Target, and Wal-Mart posted on Twitter. Finally 10 of the 18 retailers had a presence on YouTube. These were: Barnes & Noble, Home Depot, JCPenney, Lowe's, Macy's, Neiman Marcus, QVC, Sears, Target, and Wal-Mart. (Table 1)
* Retailers present on only one social media network: Facebook--Amazon, Apple, CVS, Gap, and Staples.
* Kaboodle: Macy's and JCPenney
* MySpace: Dell, Kohl's, and Lowe's
* Twitter: Best Buy, Dell, Home Depot, JCPenney, Lowe's, Macy's, Neiman Marcus, QVC, Sears, Target, and Wal-Mart
* YouTube: Barnes & Noble, Home Depot, JCPenney, Lowe's, Macy's, Neiman Marcus, QVC, Sears, Target, and Wal-Mart
Distribution across multiple social networks for individual retailers:
* Dell: Facebook, MySpace, and Twitter
* Home Depot, QVC and Wal-Mart: Facebook, Twitter, and YouTube
* Macy's: Facebook, Kaboodle, and YouTube
* JCPenney: Facebook, Kaboodle, Twitter, and YouTube
Only two of the eighteen retailers researched were active users of Kaboodle: JCPenney and Macy's. The researchers expected to see an increase in usage during the period tracked for the selected retailers who utilized Kaboodle. The number of fans for each retailer ranged from 10,000 for JC Penney the first week, and almost 15,000 for Macy's, to 17,000 the last week for JC Penney, and 21,400 for Macy's at the conclusion of the review period. A positive percentage change was found in the number of fans for each retailer during the time surveyed. JCPenney increased the number of Kaboodle fans throughout the course of the research by 71.5%, while Macy's noted an increase of 44.7%. There was only one event, week 16, the week of Christmas, by JC Penney. The number of products actually declined for JC Penney and remained fairly constant for Macy's during the entire 18 week review period. Only the future will tell if this social shopping network truly takes hold with US retailers and shoppers alike. Table 2 shows the level of activity for the two retailers on Kaboodle during the review period. Overall, the lack of retailers present on Kaboodle precluded further examination of this social network.
The downward spiral of MySpace's popularity was evidenced in data collected from MySpace activities. The researchers tracked such MySpace elements as friends and friend comments. Only three of the eighteen retailers had a presence on MySpace. As evidenced in Table 4, Dell had garnered more than 10,000 fans on MySpace, while Lowe's had approximate 1,200 fans, and Kohl's slightly less than 150 fans. Other than Dell, these numbers would be of no significance in generating significant sales impact. All the retailers saw a decrease in friends and friend comments throughout the course of the study. Dell noted a 0.01% decrease in their amount of MySpace friends and a 3.8% decrease in the number of friend comments. Kohl's Department Stores suffered the same decrease in MySpace friends, by losing 4.1%. Lowe's saw a 5.6% decrease in MySpace friends and a 3.0% decrease in comments. These results support the current literature indicating that MySpace is falling out of favor with social networkers, and other social media are taking hold in the market share. While there were only three of the selected retailers with a presence on MySpace, it is also evident these retailers were not attempting to build activity on this social network. Table 3 provides individual data trends for these three retailers on MySpace.
Among the 18 retailers, seven had a presence on Twitter. Followers and tweets were recorded weekly. From week-to-week, most of the retailers saw an increase in both their followers and tweets as the 2009 holiday season neared. Significant differences in the number of followers and tweets are evidenced across the retailers in Table 4. By far, Dell stands out from the group with over 1 million followers. However, the number of tweets for Dell was rather low, 6-800 during the entire review period. This when compared to Home Depot, which in week 3 garnered 13,000+ followers, and tweets jumped to almost 2,500, Dell's level of actual activity remained basically steady. Best Buy and QVC showed increases in both followers and tweets as the holiday season progressed. Best Buy showed 103.2% increase (from September to January) in followers and a 68.9% increase in tweets. Best Buy employed Twitter to promoted current sales and upcoming new product releases to drive consumers to their online and brick-and-mortar sites. One stand-out statistic is the 209% increase in tweets for QVC. JC Penney posted a 149% increase in Twitter followers, and a 27% increase in tweets. WalMart also showed a significant increase, 259% in followers but tweets actually declined by 81%. More modest gains were demonstrated by Sears with a 92% increase in followers and 58% increase in the number of tweets.
The researchers tracked each retailer's views and subscriptions on their respective YouTube page. Of the 18 retailers observed during the time span of September to January, ten utilized YouTube in some manner. As presented in Table 5, the most substantial increase was JCPenney as their views increased by 293% and subscribers rose by 44.%. JCPenney took advantage of YouTube by posting videos to promote special promotions such as their partnership with Rascal Flatts and their American Living Unstoppable tour (American Living is a JCPenney clothing brand line). The video reported on the surprise visit of the popular country band to a New Jersey store location. Other videos included promotions of new products, as well as style experts explaining what is new and what is popular now. Macy's posted a 147% increase in YouTube views, and an amazing 1225% increase in subscribers. This substantial increase might be attributed to videos posted on Macy's YouTube promoting their Believe campaign. Such videos included a 31 second clip that summarized the goals of Macy's popular Believe campaign with a little girl making the trip from her home to her local Macy's store to deposit her letter with the help of Queen Latifah. The retailer also created and posted a caption under the video that further explained Macy's support of the Make-a-Wish Foundation[R]. Macy's committed to donating $1 for every letter that was deposited in Macy's Santa Mail, up to $1 million. This video alone received 5,918 views on Macy's YouTube site. It should be noted however, the overall numbers for Macy's were quite small, when compared to other retailers, as Macy's had less than 5,000 views and just slightly more than 100 subscribers the final week of review. The actual numbers of views for Home Depot, Lowe's and Sears were relatively impressive--ranging from more than 200,000 to slightly less than half a million. WalMart posted an impressive 17+ million views during the period, and about 1,500 subscribers, both numbers remaining fairly constant through the eighteen weeks. Tables 6A and 6B provide the raw data numbers for each of the retailers on YouTube discussed, while Table 2 presents the percentage changes for each retailer on YouTube.
The results of the research showed a positive percentage change for each tracked month in the number of Facebook fans for all retailers (Table 6). The four retailers with the greatest increase on Facebook were: Neiman Marcus, 628% increase, Sears, 532% increase, Wal-Mart with a fan increase of 556.8%, and CVS with a 495% change from September to December. Three other retailers also showed relatively large percentage changes during the review period: Macy's with a 320% increase, Staples a 170% increase, Barnes and Noble with a 127% increase, Home Depot an increase of almost 118%, and Dell with an increase of 112%.
Amazon, Apple, CVS, Gap and Staples employed only Facebook during the review period. Amazon, Apple and Staples had no events, and minimal discussions or notes. The Gap however, did engage consumers with events. CVS and Staples showed large increases in fans, almost 500% for CVS and 170% for Staples, even though they posted no special events (Table 7). CVS and friends took advantage of the discussions application of the CVS Facebook fan page. Such discussions included topics that concerned consumers. For example, one customer discussed her trouble with being overcharged for an online order before Christmas. She reported that the retailer had charged her debit card for the amount purchased four times. When she called a customer service hotline, she was informed that this had happened to nearly 2,000 other customers as well. These discussions allow consumers the opportunity to "vent" or be heard, and it allows the retailer to listen to customer concerns and to make changes where necessary. All this leads to better customer satisfaction and a better company-consumer relationship. Staples' Facebook page includes many unique tabs that can be accessed by Staples' fans. These tabs include an application called "I Shred U!", where fans can upload pictures and virtually shred them. Other tabs include a "News" tab that informs all fans of their newest products and offers links to videos that shows the consumer how these products work. Fans can also download their own "Easy Button[R]" (a trademark of Staples) that will appear on their computer's desktop. The "Extras" tab of the Staples Facebook page educates fans about Staples programs, including EcoEasy (Staples effort to be environmentally friendly by offering consumers a variety of eco-preferable products and services--www.staples.com/ecoeasy) and Staples Foundation for Learning[R] (a program that provides job skills and educational opportunities for everyone, especially disadvantaged youth--www.StaplesFoundation.org). These exclusive tabs give Staples an advantage on Facebook and provide fans much more than the typical retailer. This appears to be an effective means of segmenting and targeting Facebook applications to be more relevant for consumers. Furthermore, those merchants with greater than 100% increase in Facebook included: Barnes & Noble, Dell, Home Depot, Macy's, Neiman Marcus, QVC, Sears and WalMart. However, there is no correlation between the number of events posted by the retailers, to the percentage increase in the fan base. Barnes and Noble, Dell and Home Depot all had slightly more than a 100% increase in fans. Macy's and QVC increased their fan base more than 300%, and Neiman Marcus, Sears, and WalMart increased by more than 500%. It appears apparel and multi-line retailers reaped the benefits of increased fan base on Facebook.
Neiman Marcus also utilized their Facebook status by updating it on a regular basis to inform customers of upcoming sales. On December 17, 2009, Neiman Marcus's status read,
"ONLINE ONLY through December 20. Save 25% off your online purchase of four+ items from our Little Gems boutique. Click for details and start saving now! http://www.neimanmarcus.com/fb/littlegems."
This status did a great job of directing customers to go to the online site. Sears also used the status on their Facebook page to communicate with their customers. Sears was very effective getting customers to become involved on their Facebook page by posting a question as their status and letting their customers to respond. This will eventually help to create a strong relationship between Sears and its customers, the prime object of social media networking for retailers. On December 22, 2009 Sears' status read,
"You told us some of your favorite baked treats for Christmas, we decided to offer you an easier way to make them! Today only, until midnight, we're offering exclusively to our Facebook fans, a Hamilton Beach stand mixer for the low price of $145.79. Check it out in the Exclusives tab."
This offer to Facebook fans only demonstrated how Sears valued their fans on Facebook. This entices more and more consumers to join the retailer's fan page. The use of Facebook status for these three retailers, is believed by the research to be the reason for the large increases that were noticed in the population of fans on these retailers' respective fan pages. In order to have a successful Facebook page, retailers should take some advice from these retailers and use their Facebook status to communicate with their customers and create a strong relationship.
Wal-Mart's success can also be attributed to their use of Facebook status. Wal-Mart updates their status frequently to let fans know what is going on, and invite them to take advantage of upcoming promotions. On December 23, 2009, Wal-Mart's status read,
"Look what fell out of Santa's sleigh - more holiday savings! Whether you're looking for the perfect last-minute gift or the makings of a delicious holiday meal, we've got you covered."
Even though Wal-Mart is a huge corporation, it has learned how to relate to consumers, as this status is extremely inviting and does a great job of encouraging shoppers to use Wal-Mart for their holiday needs. Customers have the ability to respond to this status by commenting. Their December 23rd status generated 115 comments from Wal-Mart's Facebook fans. Such comments included:
"Wal-Mart's prices are dropping all the time.." and "... I wish they brought back layaway.."
Again these statements indicate that Wal-Mart was doing a good job of reaching customers by updating their status. Clearly, Facebook is the most popular social media platform for both retailers reviewed in this study, and their respective consumer fans.
ANSWERS TO RESEARCH QUESTIONS
The purpose of this paper was to answer six questions posed by the researchers. Now let us examine the answers to each of the reseach questions posed in this paper.
Question 1: What top retailers used social media during the Holiday 2009 season? The answer to this question is that all of the eighteen retailers identified participated in at least one social media network.
Question 2: Which of the prominent social media networks did top retailers employ during the Holiday 2009 season? Primarily Facebook, Twitter and YouTube. There was extremely limited use of MySpace (3 retailers) and Kaboodle (2 retailers).
Question 3: Which top retailers employed multiple social media networks in their Holiday 2009 marketing activities? Barnes & Noble, BestBuy, Dell, Home Depot, JC Penney, Kohl's, Lowe's, Macy's, Neiman Marcus, QVC, Sears, Target and WalMart all employed more than one social network. In other words, only five of the retailers Amazon, Apple, CVS, Gap, and Staples used a single social network: Facebook.
Question 4: Did multi-channel retailers use multiple social media networks? The answer to this question is yes. Furthermore, Amazon, the one online-only retailer was one of those using only Facebook.
Question 5: Did the social media network employed by top retailers differ based upon the merchandise category sold by the retailer? The answer is yes, but that is a qualified yes, in some cases. Only department stores: JC Penney and Macy's participated on Kaboodle. It also appears that department stores, discount stores, and home improvement retailers were more likely to have a presence on YouTube.
Question 6: Did top retailers increase activities or events on the social media networks as the Holiday 2009 season progresses? The answer is again a qualified yes, for some of the retailers. Barnes & Noble, Best Buy, Gap, Home Depot, JC Penney, Kohl's, and Macy's showed an increase in the number of events they posted/held on Facebook. Other social media data collected did not show an increase in the number of promotional activities by the individual retailers, rather the increases were in the number of consumers who signed in as fans, followers, subscribers, or viewers on the individual retailers' respective social networks. Results across the different social media networks is presented in Table 7.
SUMMARY AND FUTURE RESEARCH SUGGESTIONS
To summarize these results and findings, it appears evident that as the Holiday 2009 season progressed, consumers increased they participation on social media, and for some retailers this appears to have helped boost their seasonal sales. However, these top retailers seemed to focus their attention on Facebook, with some activities on YouTube. Facebook has been embraced by retailers and consumers alike. Greater affinity, or familiarity with this social network may be why both groups show higher levels of activity on Facebook. The less familiar Kaboodle has yet to take hold with retailers and consumers alike. Viral video of any kind lends itself to the YouTube platform, so for any visually enhanced promotion, this network may be effective, but not necessarily for everyone. The fact that Twitter limits the tweet communication to 140 characters may not be the best medium for retail promotions, but given the recent growth in Twitter's popularity, that is yet to be determined. Twitter appears to have reached a plateau, as recent reports (Quenqua, 2010) indicate that while new users are signing up to Twitter, they are not active. More than three-fourths (80%) have sent less than 10 tweets after they sign up to the social network, and 40% have never sent a tweet.
This paper provides the statistics that were collected by the researchers over a 3-month time span that investigated how and what social media was employed by top retailers through the financially important holiday season. The researchers believe that the results of this study could be applied to future promotional programs, and to refine effective market segmentation and target marketing tactics. Clearly, more in-depth data must be collected to determine what consumers think about and communicate regarding retailers, special promotions and offers, as well as customer service performance. Future research should analyze the content of consumer posts and comments, as well as responsiveness to specific posts and promotions by retailers. Use of new online analytic tools should also be employed to provide more detailed statistics regarding specific social media networks and individual retailer's promotional content. Several new measures have recently been added to the arsenal of online metrics. One of those is the Facebook Fashion Index ("New Index Ranks Facebook Fans' Fashion Choices," 2010) by Stylophane. This index shows the daily percentage increase or decrease in the number of fans for a particular brand. This company also posts the Fashion Popularity Index, tracking the most searched brands online ("Fashion Popularity Index," 2010).
Successful retailers will continue to employ social media marketing, and consumers are expected to be responsive. Online retail sales were up during Holiday 2009, at the expense of brick-and-mortar sales (Coremetrics, 2010). Much of the increase is attributed to early pre-promotions for Black Friday and Cyber Monday specials. Terry Lundgren, CEO of Macy's supports the importance of the online channel for multi-channel retailers, since every $1 consumers spend online, they spend $5.77 in store. Thus, it is important for multi-channel retailers to use the Internet to attract new customers and strengthen their relationship with consumers to get them into the store. Social media marketing is a significant tool in the relationship-building arsenal. Social media continued to grow during 2009, as reported by ComScore (Radwanick, 2010), with four of five Internet users visiting a social networking site during December of 2009. Social networking now accounts for 11% of all time spent online in the United States.
While social media was about developing engagement and buzz, many retailers did not generate that many sales from SMM in 2009 (McDaniel, 2010). It is predicted that marketers will move away from just garnering followers, fans, and tweeters, to generating sales via online social media marketing strategies and tactics. There is a fine line or balance in order to successfully entice online consumers, without making they feel they are being "sold to" on the social network. To do this successfully, new metrics will need to be used to determine the appropriate segmentation strategies to deliver relevant promotions to consumers. One advantage of SMM promotions is that they do not cost a great deal of money for paid placements; rather it is simple and quick to post a promotion on Facebook, Twitter, YouTube, etc. The key is to then monitor not just the "buzz" of pass-along messages, but to analyze the content of the discussion: what consumers liked, disliked, etc. McDaniel suggests that consumer might be enthusiastic about the price of a specific promotion, but then complain the shipping and handling costs were too high. This type of information provides a simply opportunity for the retailer to capture consumer sentiment and adjust promotions.
Twitter may have been overrated (Wasserman, 2010) as evidenced by the plateau of tweets for most brands and companies on the site. Rather, interest by followers and tweets seems to be focused on celebrities, rather than brands and companies. Twitter may be effective for mining what conversations and tweets are saying about the brand, but it is not terribly effective for marketing messages. While Dell and BestBuy have used Twitter effectively to improve customer service and offer especially hard-hitting deals and promotions, it appears that Twitter may be more effective for up-and-coming brands/companies, rather than well-established corporations.
Effective cross-channel promotions, such as those using email, Facebook and Twitter are not easy. It is important to coordinate cross-channel promotions (Henrich, 2010). Email and post on the Facebook Wall, as well as posts on Twitter was not possible simultaneously. Furthermore each medium requires different metric and analytic tools. An even more complicating factor: different platforms often require different software to post to individual social media networks. Retailers will need to plan across promotions as well as channels to effectively implement social media marketing programs that garner consumer engagement and generate sales in the coming year. Effective timing and coordination across multiple social network platforms and other online and interactive media will be a challenge in the coming year.
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Michelle B. Kunz, Morehead State University
Brittany A. Hackworth, Morehead State University
Table 1: Distribution of participation across social networks Retailer Facebook Kaboodle MySpace Twitter YouTube Amazon X Apple X Barnes & X X Noble Best Buy X X CVS X Dell X X X Gap X Home Depot X X X JC Penney X X X X Kohls X X Lowes X X X Macys X X X Neiman X X Marcus QVC X X X Sears X X X Staples X Target X X Wal-Mart X X Table 2 Level of Activity for Kaboodle JC Penney Week Fans Comm Prod Promo 1 10,012 2 10,218 3 10,508 4 10,348 5 10,645 80 18,816 0 6 10,775 79 19,144 0 7 11,012 79 19,369 0 8 11,230 79 19,540 0 9 11,398 79 19,727 0 10 11,789 79 19,949 0 11 12,587 80 18,542 0 12 13,522 82 17,372 0 13 14,938 83 15,308 0 14 15,231 83 15,988 0 15 15,768 83 15,329 0 16 16,115 83 15,518 1 17 16,779 83 15,679 0 18 17,169 83 15,728 0 Macy's Week Fans Comm Prod Promo 1 14,836 2 15,077 3 15,302 4 15,489 5 15,661 26 20,869 0 6 15,831 27 21,057 0 7 16,145 27 21,304 0 8 16,433 28 21,493 0 9 16,655 28 21,622 0 10 17,013 28 21,901 0 11 17,958 28 19,586 0 12 18,081 27 18,451 0 13 19,094 32 19,214 0 14 20,199 32 19,010 0 15 20,329 31 19,374 0 16 20,576 34 19,654 0 17 20,893 34 19,781 0 18 21,461 35 20,189 0 Table 3 Level of Activity on MySpace Dell Kohls Lowes Week Friends Comm Friends Comm Friends Comm 1 10,778 147 127 1,278 1,008 2 10,834 425 147 127 1,277 1,008 3 10,818 423 145 127 1,267 1,006 4 10,813 423 146 127 1,269 1,006 5 10,805 423 144 127 1,260 1,007 6 10,793 423 143 127 1,258 1,008 7 10,778 423 142 127 1,256 999 8 10,761 417 143 127 1,248 999 9 10,752 414 143 127 1,244 994 10 10,751 413 143 127 1,242 994 11 10,747 413 143 127 1,240 994 12 10,737 412 142 127 1,239 992 13 10,730 412 142 127 1,234 990 14 10,725 412 142 127 1,234 987 15 10,703 412 142 127 1,233 985 16 10,697 411 141 127 1,233 983 17 10,689 410 141 127 1,219 980 18 10,681 409 146 126 1,207 978 Table 4 Twitter Activity Best Buy Dell Home Depot Week Foll Tweets Foll Foll Tweets Foll 1 8,773 477 1,156,585 1,364 902 4,815 2 9,344 493 1,194,679 1,423 920 4,887 3 9,754 502 1,256,743 1,724 947 5,018 4 10,175 537 1,266,190 1,560 935 5,124 5 10,596 548 1,294,412 1,808 955 2,391 6 11,030 564 1,315,715 1,900 964 5,444 7 11,548 574 1,341,237 1,993 979 5,600 8 11,944 587 1,367,066 2,097 997 5,785 9 12,349 600 1,383,306 2,199 1,010 5,896 10 12,871 626 1,401,620 2,295 1,027 6,015 11 13,118 637 1,415,874 2,358 1,039 6,132 12 13,628 643 1,429,123 2,442 1,051 6,245 13 14,104 681 1,455,988 2,652 1,091 6,619 14 14,897 724 1,489,113 2,764 1,102 6,808 15 15,349 749 1,519,001 2,909 1,117 6,991 16 16,002 768 1,522,958 3,013 1,125 7,116 17 16,859 783 1,531,768 3,215 1,137 7,229 18 17,828 806 1,540,894 3,401 1,149 7,301 JC Penney QVC Sears Week Tweets Foll Tweets Foll Tweets Tweets 1 697 2,170 215 2,323 2,822 680 2 862 2,170 215 2,345 2,940 685 3 891 2,259 221 2,361 2,941 699 4 976 2,340 238 2,431 2,941 715 5 241 2,391 241 2,560 3,010 735 6 1,073 2,459 244 4,082 374 752 7 1,119 2,529 247 4,097 375 761 8 1,186 2,593 250 4,183 375 779 9 1,238 2,646 250 4,284 395 784 10 1,320 2,768 256 4,491 404 789 11 1,389 2,910 269 5,601 436 791 12 1,449 3,122 280 6,783 458 794 13 1,636 3,398 309 7,322 471 798 14 1,860 3,510 319 7,570 487 801 15 1,902 3,766 322 7,839 492 804 16 1,978 3,897 327 8,120 503 808 17 2,037 4,014 334 8,208 516 812 18 2,152 4,177 339 8,333 525 815 WalMart Week Foll Tweets 1 2,657 3 2 2,774 3 3 13,405 2,494 4 13,405 2,494 5 13,662 2,551 6 13,928 2,606 7 14,417 2,676 8 14,401 2,718 9 14,656 2,745 10 14,951 2,793 11 15,208 2,814 12 15,417 2,885 13 15,653 2,952 14 15,944 3,023 15 16,145 3,077 16 16,877 3,105 17 17,102 3,124 18 17,437 3,146 Table 5 YouTube Activity Barnes & Noble Home Depot JC Penney Week Views Subs Views Subs Views Subs 1 9,417 187 261,017 2,479 22,470 558 2 10,168 192 263,209 2,527 22,751 562 3 10,204 203 267,305 2,609 23,708 581 4 10,257 205 265,784 2,563 22,989 568 5 10,444 206 269,169 2,650 24,300 600 6 10,626 209 270,985 2,700 24,876 612 7 10,956 215 243,711 2,769 25,861 631 8 11,280 222 276,569 2,827 26,627 648 9 11,497 227 278,591 2,864 31,421 659 10 11,807 236 281,281 2,903 51,312 682 11 11,963 241 283,742 2,957 52,984 687 12 12,062 249 286,913 2,975 54,175 693 13 12,362 257 292,115 3,054 58,765 718 14 12,725 262 297,439 3,136 63,446 734 15 12,986 268 301,751 3,227 68,147 756 16 13,198 271 306,273 3,322 73,150 779 17 13,302 280 310,678 3,340 79,249 787 18 13,435 287 315,780 3,351 88,264 806 Lowes Macys Neiman Marcus Week Views Subs Views Subs Views Subs 1 419,873 1,947 1,628 8 6,274 83 2 424,517 2,049 1,890 15 6,294 83 3 429,650 2,171 2,013 21 6,301 83 4 426,756 2,108 2,282 28 6,334 83 5 432,246 2,232 2,359 34 6,359 83 6 434,755 2,285 2,442 44 6,361 85 7 438,756 2,348 2,568 47 6,443 85 8 442,655 2,393 2,628 54 6,493 86 9 445,756 2,429 2,709 55 6,518 86 10 449,609 2,481 2,819 57 6,545 88 11 451,287 2,102 2,865 59 6,560 88 12 455,559 2,537 2,978 65 6,579 88 13 460,562 2,602 3,316 71 6,591 88 14 465,903 2,673 3,667 79 6,606 88 15 471,737 2,757 3,819 85 6,625 88 16 477,741 2,781 3,902 89 6,647 89 17 479,917 2,802 3,989 97 6,679 90 18 482,869 2,839 4,017 106 6,721 92 QVC Sears Week Views Subs Views Subs 1 94,316 445 346,532 752 2 95,671 454 349,174 804 3 97,124 465 350,871 817 4 98,698 475 351,531 836 5 352,653 849 352,653 849 6 101,778 501 353,703 856 7 104,143 514 354,975 867 8 106,496 526 355,958 881 9 108,176 539 356,897 893 10 109,679 547 358,357 909 11 111,076 552 359,997 922 12 112,942 557 361,104 939 13 115,945 565 364,627 955 14 118,987 586 368,232 968 15 122,895 609 375,033 989 16 127,110 615 380,038 996 17 132,458 623 384,139 1010 18 137,087 630 386,990 1025 Target WalMart Week Views Subs Views Subs 1 67,917 258 17,180,210 1,406 2 70,538 298 17,181,538 1,414 3 73,431 347 17,182,264 1,421 4 76,335 415 17,184,368 1,433 5 79,568 463 17,185,898 1,449 6 81,061 485 17,187,083 1,459 7 82,529 500 17,188,445 1,474 8 83,841 523 17,190,421 1,497 9 84,666 537 17,191,491 1,507 10 85,744 556 17,192,982 1,527 11 87,009 578 17,194,561 1,546 12 88,012 595 17,196,002 1,570 13 91,320 621 17,197,013 1,587 14 93,891 669 17,198,026 1,606 15 95,609 698 17,199,058 1,629 16 96,512 727 17,200,016 1,633 17 97,893 756 17,201,372 1,638 18 99,300 778 17,202,626 1,645 Table 6 Percentage Change from Week 1 to Week 18 Retailer FaceBook Kaboodle MS Twitter Fans Fans Friends Followers Amazon 26.70% Apple 4.30% Barnes & Noble 127.30% BestBuy 36.50% 103.20% CVS 495.10% Dell 112.00% -0.50% 33.20% Gap 27.00% Home Depot 117.70% 27.60% JC Penney 41.50% 71.00% 149% Kohl's 28.40% 0.00% Lowes 30.00% -5.60% Macy's 320.70% 44.70% NeimanMarcus 628.00% QVC 304.80% 51.60% Sears 531.80% 92.50% Staples 169.50% Target 38.10% WalMart 556.80% 258.70% Retailer Twitter YouTube YouTube Tweets Views Subs Amazon Apple Barnes & Noble 42.70% 53.50% BestBuy 68.90% CVS Dell 19.90% Gap Home Depot 23.30% 21.00% 35.20% JC Penney 27.40% 292.80% 44.40% Kohl's Lowes 15.00% 45.80% Macy's 146.70% 1225.00% NeimanMarcus 7.10% 10.80% QVC 208.80% 45.30% 41.60% Sears 57.70% 11.70% 36.30% Staples Target 46.20% 201.60% WalMart -81.40% 0.13% 17.00% Table 7 Percentage change for retailers only on Facebook Amazon Apple Week FBFans %Change FBFans %Change 1 15,558 1,377,557 2 15677 1,381,648 3 15734 1,385,675 4 15856 1.90% 1,388,285 0.80% 5 15959 1,390,836 6 16091 1,395,348 7 16290 1,397,490 8 16569 3.80% 1,399,974 0.60% 9 16824 1,402,716 10 17026 1,404,678 11 17321 1,406,794 12 17545 4.30% 1,408,563 0.40% 13 18337 1,411,418 14 18858 1,414,440 15 19003 1,417,491 16 19276 1,420,680 17 19513 6.40% 1,425,067 1.00% 18 19707 26.70% 1,436,369 4.30% Gap Staples Week FBFans FBFans %Change 1 395,678 28,528 2 428,057 28,963 3 434,179 28,858 4 462,361 28,883 1.20% 5 468,882 43,943 6 471,761 56,145 7 473,051 57,191 8 474,655 57,165 30.10% 9 476,173 57,141 10 477,741 57,914 11 479,182 58,241 12 482,992 59,159 3.50% 13 486,380 63,636 14 490,029 65,317 15 498,002 68,440 16 500,124 71,827 17 501,072 74,925 17.70% 18 502,641 76,886 169.50%
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|Author:||Kunz, Michelle B.; Hackworth, Brittany A.|
|Publication:||Academy of Marketing Studies Journal|
|Date:||Jul 1, 2011|
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