According to recent statistics, seven
percent on online retail sales are driven directly from social
networking sites in the UK. That figure accounts only for sales
generated from a customer clicking through to a brand’s online store
from their social media page. Considering that social media marketing is
a relatively modern concept in the history of retail advertising
strategy, that seven percent is a difficult figure to ignore. Factor in
the evidence that in the US Facebook generates more traffic than any
other site including Google, social media is a potential marketing gold
mine.
“The balance of power has shifted dramatically over the last couple of years where the retailer has to respond to the demands of the consumer of your media, whatever it may be.”
-Andrew Kovan
With e-commerce proving resilient to the effects of the economic downturn that devastated so many other retailers, social media sites attracting escalating numbers of users across America and worldwide, this platform presents a logical outlet for marketing. The wide spread use of smartphone technology, with consumers now accessing the Facebook or Twitter accounts from wherever they are, has brought yet another dimension, and one that has been proven to significantly improve a retailer's bottom line.
"The key priorities for retail and for technology innovation are understanding how to properly prioritize where we should be spending time and money," explains Andrew Kovan, CIO and Head of Customer Engagement at Steve Madden. "Mobile is a tremendous game changer for us. So we've built a mobile website, and now we're trying to figure out how we can drive that to drive more store traffic and how we can utilize that to help our wholesale partners be more effective and develop the best business practice."
The best business practices, for Kovan, include using the social networking paradigm to communicate directly and effectively with his customers, so as to fully understand what it is they want and be able to give it to them. "So we can maintain a more significant relationship or a more personal relationship," he explains, "which has been proposed as a holy grail of any business for a very long time. I think the challenge now is that consumers are more piped in to what can be done and they have access to a lot more information, which is raising the bar."
Kovan reveals that he is currently involved in gaining a better understanding of how Steve Madden's online brand is marketed out to consumers, and the speed and complexity with which this social media marketing sector is evolving, so as to be abreast of the innovations in this field. "We're really taking a longer range perspective," he explains, "because the speed of the game has changed so much and the challenge will be for us to keep up with the changing nature of the business. It's the consumer that's driving it. I mean we've got to face that fact. The balance of power has shifted dramatically over the last couple of years where the retailer or the brand or the service provider or whoever it may be has to respond to the demands of the customer, the consumer, the consumer of your media whatever it may be."
By way of a warning Kovan cites the publications industry as an example, pointing out that following the recent, huge shift in the magazine trade caught many business that had not moved with the times "sleeping at the wheel". In order to prevent this from happening in his organization, and to encourage a collaborative culture, he explains how he stays in contact with the whole staff base, emailing updates of his findings every couple of days and engaging in meetings so as "to encourage others to take the opportunities as they see fit."
One to group
"We're doing a lot of testing right now with Facebook," Kovan reveals when discussing Steve Madden's social media strategy. "We're trying out a whole variety of different strategies with Twitter, marketing and promotional messages versus informational. One thing that we're finding especially with social media is there's a lot of byproduct that's incredibly valuable, more so than how many followers you have."
Indeed, Kovan seems to embracing the dual powers of a social media following; a way of gleaning information about your consumers, as well as a direct marketing line to them. He is in a position to utilize the high levels of data that can be gained about his consumers and a then begin to create a marketing strategy accordingly, as well as distributing the information around the organization. But he hastens to add that it is a gradual process, and Steve Madden still has a way to go. "I call it crawl, walk, run, and I think we are between crawling and walking right now.
"I think there's tremendous potential moving down the road for much better segmentation and much better utilization of data to more effectively create direct one to group, not one to one [marketing]. One to one I've heard for 15 years and it still hasn't come to pass, even with billions of dollars of investment. I think one to segment is achievable today. I think one to segment some of us are doing. I think one to segment is probably something that will be the standard within the next 24 or 36 months for marketing communications."
He goes on to explain that engaging with your followers is the most effective way of utilizing the social media paradigm to market your products, and to that end is testing polls and questions and contests to interact with consumers. "Our hope is that in talking with [the consumer]," she says, "a lot of product development ideas, a lot of marketing strategy ideas will come out of it. Maybe things that were not originally discussed, probably contemplated but not as aggressively discussed but that's kind of unilateral."
Asking questions such as "What do you think of this?"; "Would you choose this shoe or this shoe?"; "If you could have a gift with purchase here's a poll. Tell us what it would be."; "What's your favorite color of nail polish?" allows Kovan and his team to glean some insight into how the customers are behaving and how they create more compelling marketing campaign to drive consumer into the store.
"I think that my perspective has evolved as I've started to recognize the engagement factor. I look at brands like Sephora and Starbucks and I see how tapped in and how engaged their followers are with their brands. I think our brand historically was more talking at consumers on Facebook, telling them what we thought empathetically, not as much asking them to tell us and that's the shift. We'll start the conversation."
Loyalty
"I think for us we see social media and we see everything we do as kind of being a continuum to gather information to get closer to who is our customer and what is it that they want." This mentality is beginning to pay dividends as with the company's loyalty schemes. Using the information gathered through social media interaction, notably the Facebook polls, also helped Kovan's teams to roll out the most appropriate loyalty rewards. "It started out by asking some questions, "What would you like as a gift for purchase?"" he explains. "That was one of the questions and ironically the number one answer was, "Something to store my shoes in," like a shoe rack or a canvas shoe bag you can put over your door. So we're definitely going to run promotions, promote it via social media."
The numbers are encouraging. Kovan explains that generally the loyalty schemes invite customers to make a purchase with Steve Madden; any customer that makes a purchase within a certain week will be eligible to win a prize for their loyalty and typically around 25 customers will receive a prize each week. Kovan reveals that in just over a week, Steve Madden's Facebook fan base has increased 24 percent. Growing from 16,900 user to 21,000 users, he believes 100,000 can be reached without much difficulty. "I've mandated that we'll get to 100,000 followers in an engaging way within 12 months and I made that announcement two weeks ago. So I've got 50 weeks left to get there."
www.ngretailus.com
“The balance of power has shifted dramatically over the last couple of years where the retailer has to respond to the demands of the consumer of your media, whatever it may be.”
-Andrew Kovan
With e-commerce proving resilient to the effects of the economic downturn that devastated so many other retailers, social media sites attracting escalating numbers of users across America and worldwide, this platform presents a logical outlet for marketing. The wide spread use of smartphone technology, with consumers now accessing the Facebook or Twitter accounts from wherever they are, has brought yet another dimension, and one that has been proven to significantly improve a retailer's bottom line.
"The key priorities for retail and for technology innovation are understanding how to properly prioritize where we should be spending time and money," explains Andrew Kovan, CIO and Head of Customer Engagement at Steve Madden. "Mobile is a tremendous game changer for us. So we've built a mobile website, and now we're trying to figure out how we can drive that to drive more store traffic and how we can utilize that to help our wholesale partners be more effective and develop the best business practice."
The best business practices, for Kovan, include using the social networking paradigm to communicate directly and effectively with his customers, so as to fully understand what it is they want and be able to give it to them. "So we can maintain a more significant relationship or a more personal relationship," he explains, "which has been proposed as a holy grail of any business for a very long time. I think the challenge now is that consumers are more piped in to what can be done and they have access to a lot more information, which is raising the bar."
Kovan reveals that he is currently involved in gaining a better understanding of how Steve Madden's online brand is marketed out to consumers, and the speed and complexity with which this social media marketing sector is evolving, so as to be abreast of the innovations in this field. "We're really taking a longer range perspective," he explains, "because the speed of the game has changed so much and the challenge will be for us to keep up with the changing nature of the business. It's the consumer that's driving it. I mean we've got to face that fact. The balance of power has shifted dramatically over the last couple of years where the retailer or the brand or the service provider or whoever it may be has to respond to the demands of the customer, the consumer, the consumer of your media whatever it may be."
By way of a warning Kovan cites the publications industry as an example, pointing out that following the recent, huge shift in the magazine trade caught many business that had not moved with the times "sleeping at the wheel". In order to prevent this from happening in his organization, and to encourage a collaborative culture, he explains how he stays in contact with the whole staff base, emailing updates of his findings every couple of days and engaging in meetings so as "to encourage others to take the opportunities as they see fit."
One to group
"We're doing a lot of testing right now with Facebook," Kovan reveals when discussing Steve Madden's social media strategy. "We're trying out a whole variety of different strategies with Twitter, marketing and promotional messages versus informational. One thing that we're finding especially with social media is there's a lot of byproduct that's incredibly valuable, more so than how many followers you have."
Indeed, Kovan seems to embracing the dual powers of a social media following; a way of gleaning information about your consumers, as well as a direct marketing line to them. He is in a position to utilize the high levels of data that can be gained about his consumers and a then begin to create a marketing strategy accordingly, as well as distributing the information around the organization. But he hastens to add that it is a gradual process, and Steve Madden still has a way to go. "I call it crawl, walk, run, and I think we are between crawling and walking right now.
"I think there's tremendous potential moving down the road for much better segmentation and much better utilization of data to more effectively create direct one to group, not one to one [marketing]. One to one I've heard for 15 years and it still hasn't come to pass, even with billions of dollars of investment. I think one to segment is achievable today. I think one to segment some of us are doing. I think one to segment is probably something that will be the standard within the next 24 or 36 months for marketing communications."
He goes on to explain that engaging with your followers is the most effective way of utilizing the social media paradigm to market your products, and to that end is testing polls and questions and contests to interact with consumers. "Our hope is that in talking with [the consumer]," she says, "a lot of product development ideas, a lot of marketing strategy ideas will come out of it. Maybe things that were not originally discussed, probably contemplated but not as aggressively discussed but that's kind of unilateral."
Asking questions such as "What do you think of this?"; "Would you choose this shoe or this shoe?"; "If you could have a gift with purchase here's a poll. Tell us what it would be."; "What's your favorite color of nail polish?" allows Kovan and his team to glean some insight into how the customers are behaving and how they create more compelling marketing campaign to drive consumer into the store.
"I think that my perspective has evolved as I've started to recognize the engagement factor. I look at brands like Sephora and Starbucks and I see how tapped in and how engaged their followers are with their brands. I think our brand historically was more talking at consumers on Facebook, telling them what we thought empathetically, not as much asking them to tell us and that's the shift. We'll start the conversation."
Loyalty
"I think for us we see social media and we see everything we do as kind of being a continuum to gather information to get closer to who is our customer and what is it that they want." This mentality is beginning to pay dividends as with the company's loyalty schemes. Using the information gathered through social media interaction, notably the Facebook polls, also helped Kovan's teams to roll out the most appropriate loyalty rewards. "It started out by asking some questions, "What would you like as a gift for purchase?"" he explains. "That was one of the questions and ironically the number one answer was, "Something to store my shoes in," like a shoe rack or a canvas shoe bag you can put over your door. So we're definitely going to run promotions, promote it via social media."
The numbers are encouraging. Kovan explains that generally the loyalty schemes invite customers to make a purchase with Steve Madden; any customer that makes a purchase within a certain week will be eligible to win a prize for their loyalty and typically around 25 customers will receive a prize each week. Kovan reveals that in just over a week, Steve Madden's Facebook fan base has increased 24 percent. Growing from 16,900 user to 21,000 users, he believes 100,000 can be reached without much difficulty. "I've mandated that we'll get to 100,000 followers in an engaging way within 12 months and I made that announcement two weeks ago. So I've got 50 weeks left to get there."
www.ngretailus.com
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