Capitalizing on the Social Media Revolution

WVictoria'sith the social media revolution in full swing in the retail industry, it would appear that Facebook is emerging as one of the most effective ways for companies to reach potential customers. Recent studies have indicated that Facebook is ahead of the pack amongst social networking sites being used by some of the biggest retail chains. The Limited Brands’ Victoria’s Secret is in the lead currently in this department, with 2.8 million fans on its Facebook company page.

“Many customers say they really wanted to hear about sales and products,” said Kevin Ertell, VP of Retail Strategy for research firm ForeSee Results, in an interview with Marketing Daily. “Yet many retailers aren’t doing that—conventional wisdom is that fans want things like engagement, with polls, or pithy comments or customer service tools. [We’ve] found those things are actually far less important.”

Studies like those conducted by ForeSee Results have often discovered that consumers who interact with their favorite companies via social media tend to become those companies’ most satisfied and loyal customers. Also, those customers who tend to seek out the Facebook pages of companies they support are often amongst the more loyal and satisfied. Their loyalty and satisfaction are thereby increased, creating a very positive cycle of consumer interaction.

Yet, it’s been determined that as many as a quarter of the top 100 online retailers still has no Facebook page, and another quarter has less than 10,000 fans. The aforementioned Victoria’s Secret, however, is an example of a major winner in the social media department, with some experts attributing this success in part to the brand’s teen-targeted “Pink” subdivision. In fact, this brand currently has 1.8 million Facebook fans on its own, distinct from the fans of Victoria’s Secret proper.

Ertell maintains that brands like Victoria’s Secret do well on Facebook because they give consumers what they most want—namely, information on new products, new promotions and hot bargains. Nevertheless, it is worth noting that the pitfall of social networking, Facebook fan pages included, is the temptation to bombard fans with too many updates. This harkens back to the more traditional practice of sending out emails to customers, which also brings back diminished returns if overused.