Like many of
you, I find that sometimes it is difficult to know how social networking can play
a part in business – especially small e-commerce and retail businesses. More
and more we are seeing companies experiment with or incorporate social
networking sites into their marketing strategies. As confusing as it can be – I
am intrigued and think that it is very important for all of us to pay attention
to trends in this space. For instance, if you’ve been on YouTube lately, you
may have noticed that the popular video site is now in the e-commerce business.
The
Google-owned company recently announced that it was adding “click-to-buy” links
to thousands of videos and will be partnering with e-commerce juggernauts
iTunes and Amazon.com in the process.
Watching a
video about a soon-to-be-released video game? Well, now you can just click a
link and buy it! It’s a bold move that should benefit both the retailers and
YouTube.
Which brings
me back to the world of social networking and how it can help small- and
medium-sized retailers. Did you know that heavy social-networking site users
are more apt to visit online retail sites? According to a 2007 comScore study,
95 percent of people who regularly visited sites such as Facebook, MySpace and
YouTube said they also visited retail sites. That’s compared to 80 percent of
the total U.S. Internet audience.
If you’re
marketing to a younger populace, you may absolutely want to think about a
social network strategy. According to a recent study by shopping comparison
site PriceGrabber, 85 percent of Generation Y participates in some form of
social networking.
I recently
interviewed Kristi Grigsby, marketing director for Neighborhood America,
an organization that builds enterprise-oriented social networks for clients
ranging from Volkswagen to Fox News, on how these sites can benefit retailers.
First,
Grigsby says, you need to determine if a social site is right for you. She says
that merchants who already have customers are more apt to succeed than those
who don’t. (After all, a network won’t do you much good if no one goes to it).
Having a compelling product is another precursor. A retail technology product,
for example, is a better candidate than, say, a lawn care product. (Nothing
against lawn care products.)
So, what can
a social site do for you? It will let you better connect with your customers.
Yes, they will be in control. But that’s a good thing. Grigsby says that when
your customers are in control, you will get unfiltered opinions—directly from
the people buying your products. Wow – what a cost-effective way to generate
some market research.
Best of all,
social network sites aren’t just for large car companies or news organizations.
Grigsby tells of one small t-shirt retailer, Threadless, which has been wildly
successful with its network. The site lets users design their own shirts. These
designs are voted on by other users. The top-rated shirts, meanwhile, are then
made. The company (which is not a client) is getting thousands of clothing
design — for virtually free!
The 35-person
firm adds 20,000 new members monthly and receives 150 new t-shirt designs every
day. This year, the company expects to post $20 million in revenue!
“That’s a lot
of t-shirts,” Grigsby says with a laugh.
Oh, and if
you’re thinking that a down economy may not be a good time to start a network,
you may want to rethink.
“In these
economic times, consumer spending is down,” Grigsby says. “It’s a competitive
market. Never has there been a more critical time to think about connecting
with customers more intimately — especially for retailers.”
I haven’t
solved the mystery of social networking, but I will continue to share what I
find out. We are interviewing a subject matter expert on this topic later this
month – so stay tuned, it should be fascinating stuff!
'Til next time,
Joan
The eSecurity Diva
