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Barbara Farfan

Why Most U.S. Retail Chains Don't Like New Social Media Studies or the Retail Shoppers Guide to Social Media That Research Reveals (SBUX, WFMI)

By , About.com GuideJuly 31, 2012

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While top U.S. retail companies are still searching for the best way to use their social media channels, and researchers are studying social media behaviors from all angles, customers have figured it out already. If there were such a thing as the Retail Shoppers Guide to Social Media, the chapters would read something like this:

CHAPTER 1: A Picture Paints a Thousand Tweets - Shopping on Pinterest is More Fun
CHAPTER 2: Do Your Homework at Home - Compare Prices, Read Reviews, Find Coupons, and Use Your Social Networks for All of the Above
CHAPTER 3: If You're Happy With Your Shopping, Clap Your Hands - and Tweet Your Friends
CHAPTER 4: When Facebook Sucks, Just Change the Social Channel

This is the how-to manual that would be written by shoppers for shoppers, if the wide variety of recent research about shopping, the Internet, and social media is accurate. Because the desire is strong to understand the behavior of the unbridled shopper powered by technology, the studies trying to make sense of it all are numerous. The most recently released research studies tell us:

  • 85% of shoppers browse the Internet for apparel, according to a survey by Cotton Incorporated. On average, respondents to the Cotton Incorporated survey spend 100 minutes shopping online and in stores each month, which includes two in-store shopping trips and one online shopping session per month.
  • 79% of consumers say they "always or usually" do price comparisons online before they make an in-store purchase. Also, 73% of shoppers look for online coupons and 57% of shoppers read customer reviews before making purchases, according to the Cotton Incorporated survey.
  • Four of the five most followed retailers on Pinterest are fashion retailers. And it's no wonder because Pinterest is estimated to have 20 million users, according to ComScore and approximately 82% of Pinterest users are women, according to a July Report by Digital Flash NY.
  • Pinterest surpassed Twitter for referral traffic to websites in June, according to data compiled by Shareaholic from 200,000 websites. Pinterest is now also sending more referral traffic to websites than StumblUpon and Bing.
  • According to a study conducted by the Incyte Group, 82.6% of customers would be happy to be an online advocate of brands that they genuinely love, and 50% of those people would do it for free.
  • Facebook users are less and less satisfied with their experience on the world's largest social media platform. According to the American Customer Satisfaction Index (ACSI), not only does Facebook have the lowest customer satisfaction of all social media companies, Facebook also has the lowest customer satisfaction of all Internet companies. Facebook's customer satisfaction rating has dropped about 12% since 2011. According to a June, 2012 poll by Reuters, 80% of Facebook users say they ignore Facebook ads.
  • Twitter is the social media platform most used by the Fortune Global 100, according to the "Global Social Media Check-Up 2012" published by Burson Marsteller. 82% of the Global Fortune 100 have Twitter accounts, and the average number of followers on those corporate Twitter accounts grew 289% in the past year. 71% of the Global 100 claim they engage with their Twitter followers with retweets, and @mentions.

These are the latest insights about the ever-shifting social media landscape, and they are interesting and somewhat useful. The one question, though, that I've yet to see on any of the many studies that are done each year about shopping, the Internet, and social media is "What would you like to get online from retail companies that they're not giving you now?" Whether the question is asked or not, in the world of complete access and total control, shoppers will always find a way to get what they need wherever they can find it. And that is what really drives retailers crazy.

It's not that retail companies don't "get" social media, it's that most retailers don't like what they know to be true. Retailers don't want to encourage all the uncensored, two-way, public communication that social shoppers desire because it's uncontrollable and it's time-consuming. Retailers are willing to engage on their own terms, but that simply isn't enough for today's empowered shopper.

To be fair, this is a big philosophical adjustment that the largest U.S. retail chains are being asked to make, and it's not easy. Big retail companies are accustomed to being in complete control of their one-way messages, and they have enjoyed the challenge of manipulating consumer behaviors with those controlled messages. So it's understandable that retailers have tried to use that same controlled message manipulation strategy in the world of social media. And it's also understandable that retailers are frustrated that they can't find a way to make old strategies work in a new technologically socialized world.

Also to be fair, most retail companies have shown at least some willingness to engage, interact, and build relationships on social media - as long as it doesn't take time or cost money. If the the ROI of individually engaged customers can't be calculated, the spreadsheet-orientated companies just can't justify social media efforts to their bottom-line senior leaders.

The socialized bottom line is that a retail company that didn't value building relationships with customers before the explosion of social media isn't all of a sudden going to change its fundamental business philosophy with a few tweets, pins, and updates. Retail companies like Starbucks, Whole Foods, and Nordstrom are the retail social media champions today because they were already the retail customer service champions of yesterday, with business cultures built to create customer engagement. Social media just made it easier for the most customer-centric retailers to do what they were already doing.

It's not that companies, retail or otherwise, don't understand social media. It's that they don't value the outcome that social media can create for them. So the search will continue for how to make social media "work" without having to change any fundamental business practices. The answer is.... it won't. And all the research studies in the world are not going to change that.

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Comments

July 31, 2012 at 6:02 am
(1) Aditya says:

Interesting article!! I work for McGladrey and there’s a white paper on the website about this very topic readers would find useful. It describes several issues impacting retail sales, closures and acquisitions.FYI

August 13, 2012 at 8:55 am
(2) Khalia Wilkinson says:

GREAT Article! One of your final thoughts really hit home! “Retail companies like Starbucks, Whole Foods, and Nordstrom are the retail social media champions today because they were already the retail customer service champions of yesterday, with business cultures built to create customer engagement.” Accurate point.

KW

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