Loyalty schemes are a great incentive for consumers, lets face it, and don’t we all love to be rewarded with free stuff/extra points/discounts? I know I do!
The popularity of these programs has exploded around the world, currently increasing in attractiveness (Sharp & Sharp, 1997). As competition in many markets is increasing, these schemes are introduced to build customer loyalty based on a customers purchase history (Yi & Jeon, 2003). Looking at some academic literature, the ultimate goal is to establish increased customer retention from profitable sectors, done by providing enhanced satisfaction and value to particular customers (Kannan & Bramlett, 2000).
This blog will critically analyse one case study showcasing how and why it has become a success. Then followed by some hot tips so keep reading!
Below you’ll see a video from Lance Walker presenting at a TED Talk on customer loyalty programmes, which is a great watch! He speaks about how we carry our mobile phones instead of our wallets and purses, which will increase the utility of loyalty programmes on mobile, which leads fantastically onto the IKEA case study.
After hearing what Lance had to say in the TED talk, we are aware that mobile is playing an explosive role in loyalty schemes, especially for IKEA as it continues to build motion in the US with the Family Program.
STRATEGY
The umbrella strategy at IKEA is to focus on offering customers every day low prices.
GOAL
The goal of the loyalty program is to reward IKEA best customers with special offers and discounts throughout the store.
This scheme has been available in other countries around the world for a number of years, such as Europe and the Far East, however was introduced into the US in 2011. The global communications manager for IKEA Family unveiled new plans at the Retail Bulletin Customer Loyalty Conference 2012 in London, including: rebranding, data anaylsis and mobile marketing. Holst stated “all countries should present a unified front” – creating an impressive brand image that will ultimately enhance brand reputation across the globe.
A key part of this strategy is mobile with employees using tablets in store to sign up new customers to the Program and were SMS messages are sent to keep customers aware of new products. The tablet allows has been extremely well received with stores using at events in and out of store to sign up new members – is this something your brand could do? Regarding the SMS messages, IKEA are placing heavy focus on delivering targeted content specifically for the Family Program members – is this also something your brand could do? SMS have been a great way to help unite it’s various communication channels together having found that the value of a consumer will increase the more channels and programs they are signed up to.
PROS
Gives members a program more relevant to their needs
Extended services (longer period for refund and exchange policy)
Not based on a points system, instead it’s a continuous process of giving back to its consumers
CONS
High cost of promotion and implementation
Time consuming and complex to operate regarding human resources
Re-launch can be a disadvantage as conumers are used to the company and attitude (Burt et al, 2011)
Long way off generating as many advantages as Tesco (worlds most successful loyalty card – in many aspects) (Burt et al, 2011)
Risk of failing foul of Consumer Privacy act
To critically analyse this case study, we can see from academic literature that Palmer & Beggs, (2000) state that loyalty programs and market segmentation should be inextricable linked for these two very important reasons:
The data typically collected can allow for detailed anaylsis of customer profiles so that a company is able to accurately identify very small market segments with distinguishing buying behavior
On the basis of information collected, suppliers are able to adapt the product offer to the needs of individual segments
IKEA possess these traits however, it is important to recognise that this is a continuous process and large organisations should be aware of mistakes to avoid in order to enhance the effectiveness, and desire to become part of a brands loyal community.
Check out this Whitepaperfrom Forte Consultancy on Loyalty Programs gone wrong and how to avoid the common mistakes!
To summarise this blog, take a look at some secrets to ensure your loyalty scheme is effective:
Integration of loyalty into the full experience
Integrate payments and mobile technology into the store experience to ensure the transaction is more enjoyable
Use the data
Important to move beyond the “discount only” standardisation and build market leading capabilities to target the highest value customer
Build partnerships
For example, collecting rewards across a broad variety of non-competitor retailers furthering value proposition to customers – this will capture external data that could be beneficial
Maximise the difference between perceived value and real cost
Develop a series of offerings that are highly valuable to top customers but have little marginal cost to your company
Allocate loyalty reinvestment to the most profitable customers
Offer rewards based on ticket price where loyalty rewards spend remains similar to other brands in your market – this is aimed at driving profitability.
If you are interested in finding out more, take a look at this Blog from the Wise Marketer on the 30 major factors behind a successful loyalty programme!
References:
Burt, S., Johansson, U., & Thelander, Å. (2011). Standardized marketing strategies in retailing? IKEA’s marketing strategies in Sweden, the UK and China. Journal of Retailing and Consumer Services, 18(3), 183-193
O’Brien, L. and Jones, C. (1995) Do rewards really create loyalty? Harvard Business Review, May-June, 75-82
K. Kannan, & M. D. Bramlett. (2000). “Implications of Loy- alty Program Membership and Service Experiences for Customer Retention and Value.” Journal of the Academy of Marketing Science 28 (1): 95-108
Palmer, A., Mcmahon-Beattie, U., & Beggs, R. (2000). Influences on loyalty programme effectiveness: a conceptual framework and case study investigation. Journal of Strategic Marketing, 8(1), 47-66
Sharp, B., & Sharp, A. (1997). Loyalty programs and their impact on repeat-purchase loyalty patterns. International journal of Research in Marketing, 14(5), 473-486
Yi, Y., & Jeon, H. (2003). Effects of loyalty programs on value perception, program loyalty, and brand loyalty. Journal of the academy of marketing science, 31(3), 229-240
After looking at why Social Media is important to business’s in my previous blogs, I’m now going to critique if Facebook competitions can increase awareness to ultimately drive sales (doesn’t every company want to drive sales!?) Take a look at the below table from Mangold & Faulds, (2009) to see where Facebook is situated within social media as whole.
(Mangold & Faulds, 2009)
It is interesting to recognise that Facebook originally started out as a niche private network for Harvard University Students (Kietzmann et al, 2011) and now has become an integral part of everyday lives not only for consumers but also for businesses. This presents an enormous challenge for firms where management methods are ill-suited to deal with the change in how customers want to be listened to, engaged and responded with (Kietzmann et al, 2011). It is apparent that companies are using sites such as Facebook to support the creation of brand communities (Muniz & O’Guinn, 2001) showing academic theory behind the aim of this blog. Examples of this are Warner Brothers and Adidas allowing visitors to associate themselves with an identity and ensuring activity alignment (Kaplan & Haenlein, 2010).
Worldwide, there are over 1.39 billion monthly active Facebook users (13% increase yea-on-year) statistically meaning Facebook is just too big to ignore, offering a massive platform to showcase your brand and products.
In the increasingly saturated market place of home furnishings, it is essential to promote your brand to stay ahead of your competitors. As Hall & Bensoussan, (2007) state, “the level of need to remain competitive has increased by statistically a significant amount since 1996”. With 16 million local business pages created since May 2013, a whopping 100% increase from 8 million in June 2012, shows just how popular this channel must be.
The Facebook competitions that succeed are ones, which appeal to the lifestyle and interests of the brand’s target market, creating the best Return on Investment. Ultimately this keeps the motivation to enter, related to your brand and your products. The Facebook competitions that don’t succeed are ones that give away other incentives that are unrelated to the brand, an example of this could be iPads being given away by home furnishing companies.
Very.co.uk is a national UK shopping website that has used Facebook to increase its traffic by starting a Facebook competition with the caption #TheFreeze.
How to enter?
To enter and win the weeks #PartyInStyle (the weeks featured outfits) entrants need to firstly watch the Very Video. Great advertising of its stylish products, agreed? The entrant then takes a selfie mimicking the pose from the advert and posts it onto the competition page. Simple!
Why it works?
This competition is aimed at woman, the brands core demographic and target market and has been creatively executed. Very are capitalising on the populariry of the selfie and more importantly enticing its core customer.
Crate & Barrel are a home furnishing and houseware supplier that started off in Chicago. Now it is owned by the Otto Group of Hamburg, Germany – the 2nd largest online retailer worldwide! The competition objective was to encourage engaged couples to create gift registry with the store.
How to enter?
The competition used the Strutta platform, where entrants had to create a gift registry, and then submit 3 images and answer 3 questions. There was a round of voting then a judging panel picked the final winners – to win a $100,000 dream wedding! With Strutta, Crate & Barrel were able to:
Validate each couples gift registry for entry
Build a customised site
Manage and moderate all content
Why it works?
The competition was promoted across all channels (website/press releases/online advertising/email and blogger outreach/in store displays)
Results:
$35 million in gift registry created over 2 campaigns
16,000 couples shared their love story!
3 million pages views over a year
1/2 million votes each year
As soon as couples upload their photo’s they can share and tell friends to get as many votes as possible, having customers promote the competition themselves can be the most cost effective way of promotion!
However, Facebook competitions can go wrong (creating bad brand reputation and not brand awareness):
Lori Greiner (from QVC)
Where did it go wrong?
First impressions, this would look easy and simple to enter. However, critically analysing this competition, people have to comment on the image to enter which is against the Facebook terms and conditions.
It is also against the rules to administer a competition through a photo and instead should be done through a 3rd party application.
To summarise, as the competition is done through an image, Lori has no way of contacting the winner apart from posting it on her page and asking them to message the page. Again against the guidelines! This shows a level of unprofessionalism which can affect consumer confidence in a brand, what if the post gets missed?!
Skillens Jewellers in Castlewellan
Where did it go wrong?
Planning to give away a tanzanite and diamond ring sounds too good to be true? It was. All you had to do was like the photo, share the photo and comment saying ‘liked’ or ‘shared’. Again, critically analysing this example, this goes againt Facebook page.
Something that can damage brand reputation rather than enhance awareness is coming across as lying to entrants. Lynda answered from the Skillens account, which portrayed a confusing message that she was an employee, attracting outrage. It later emerged she was not an employee, however having devastating effects on the company as the Facebook page was deleted – potentially having consequences on sales.
Brand Awareness
Let’s be honest, everyone likes to win freebies, don’t they? Competitions, if done correctly can be super effective, as we can see, with little outgoing expenditure for the brand. This can be a key tactic when wanting to boost online traffic and over time, can lead to higher sustained levels of traffic.
To increase brand awareness and ultimately sales, these are things not to forget:
Include competition information on your website
Ensure entrants must visit the website to enter
Link back to the site whenever promoting the competition!
And avoid the following:
Using a Facebook feature as a contest
Click like to win
Share this photo and win
Comment to win
Not using an application
Popular competition applications are: Binkd, Strutta & Wildfire
Announcing winners on wall
Giving away unrelated prizes
Not promoting enough
How to run a successful Facebook Competition:
It is important that you understand how to run a Facebook competition, as it can be confusing. Checkout this great 5 minute video below that will guide you through how and how not to create a successful Facebook competition for your brand!
Did you get all that? If not take a look at this helpful blog, giving you a detailed 5-step guide, from Wishpond! However, Facebook reserves the right to remove any business page without warning, for not adhering to the terms and conditions. So be careful!
Finally to summarise this blog, I think the scope of Facebook has dramatically changed over the years allowing business to become more personal and interactive with consumers through things such as competitions. There have been some great examples above showing how traffic has increased to the websites having a knock on effect of increased sales. However through critical analysis, there are also some poor examples that have in turn created a poor brand reputation even leading to a business Facebook page being shut down – definitely creating poor brand awareness and no ROI.
There is the famous saying of.. “Any publicity is good publicity” which can be seen as a subjective statement. But do you agree?
References:
Hall, C., & Bensoussan, B. (2007). Staying ahead of the competition.
Kaplan, A. M., & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of Social Media. Business horizons, 53(1), 59-68
Kietzmann, J. H., Hermkens, K., McCarthy, I. P., & Silvestre, B. S. (2011). Social media? Get serious! Understanding the functional building blocks of social media. Business horizons, 54(3), 241-251
Mangold, W. G., & Faulds, D. J. (2009). Social media: The new hybrid element of the promotion mix. Business horizons, 52(4), 357-365
Muniz, A. M., & O’Guinn, T. C. (2001). Brand community. Journal of Consumer Research, 27(4), 412—432
Following on from my previous blog post, where I discussed the HOT benefits of social media, I’m now going to directly relate it to the home furnishings market.
The UK home furnishings market is positioned as part of the home furniture industry. This contributes a whopping £9.4bn to annual GDP, a figure that took me by surprise due to its sheer size. Industry revenue is projected to grow by 4.9%, which didn’t take me so much by surprise considering that the Government’s Help to Buy scheme is estimated to help 120,000 households, increasing the number of first time buyers, having a positive trend on the UK home furnishings market. Surely you’re now thinking how can social media increase this statistic even more? So now lets look at the social media industry and see how the two combined, can benefit from one another..
Since the millennium, user generated content has turned the world upside down, becoming increasingly popular on the web. An important thing to remember is more and more users are participating in content creation, instead of just consumption (Agichtein et al, 2008). Without overwhelming you with numerous statistics, here are just a few to get your head around; Twitter has become the most popular micro blogging site (Zarrella, D. 2010) with an expanse of over 230 million active users (an opportunity not to be missed by home furnishing retailers), Facebook has become the foremost site, allowing companies to track and engage with potential customers (Zarrella, D. 2010) with over 1.2billion users. Its apparent to see that social media is an effective way of communicating for retailers (Chaffey and Ellis-Chadwick, 2012) – surely?!
Put both these industries together and you cant deny the ever-growing importance of social media as consumers go-to tool for inspiration, reviews, communication and shopping.
I’ve found this great case study on Fab Furnish as a great example of a success story.
In order to utilise and leverage social media, it is important to set some business objectives, for Fab Furnish they wanted to:
Increase website traffic
Increase sales by 20% every month using their Facebook Ads
So how did they go about it? If you want to read in more detail then check out this blog on Digital Vidya!
Strategies implemented to attain their objectives:
Photo Ads
Fab Furnish posted relevant and attractive photographs showcasing the best of their 60,000 products. These were shown on desktop and mobiles on the right side of the page, in the form of news feed, encouraging people to click on them.
Link Ads
This increased traffic to the website providing quick and easy further details of the products.
Quality Images
In-house top quality images were selected to be in the Ads alongside embedded call to action tab enabling visitors to take immediate action.
Targeted Right People
Fab Furnish decided to target the upwardly mobile bracket with superior spending capabilities and those expressing an interest.
Custom Audiences
The first line of target should be a customer that is loyal as they prove to be a valuable part of a business. Identifying requirements of those existing helps to market appropriately and effectively.
Increased Online Sales
Don’t forget that it’s essential for potential customers who click through, are forced to visit again and again!
How to change your online presence:
Setting up a page
This should include all the information about the business, its diverse range of products, not forgetting attractive images and links to interesting blogs and the website
At least one page category should be mentioned to appear in search results making it easily accessible.
Identifying the target audience
For a home furnishings company, this needs to be people who are willing to spend on these products and those who have shown interest in products whilst visiting the website. This helps to target the right products to the right customer.
Compelling Content
This has more of an impact than blocks of text, encouraging increased click through. Queries need to be responded promptly to help develop a bond to the brand. Links provided increase user friendliness and enables interaction for the customer.
What were the resultsfor Fab Furnish?
Revenues increased by 10 times
Traffic to the website increased 5 times
The number of orders increased by 12 times
The ROI over advertisements increased by 2 times
WOW.. it’s now clear to see that home furnishing companies can leverage their online sales by implementing social media marketing strategy to attain objectives. These channels should be embraced and not ignored! I’ve definitely learnt more through this success story and I hope you have to!
However I’ve also found an example of a failed success story, looking at Habitat UK.
This trendy furniture store decided to use trending topics on Twitter to get their brand and products noticed. Habitat UK used hashtags that had nothing to do with furniture or shopping, using popular ones at the time such as #Apple, #iPhone, even using a hashtag for an Iranian election, trying to get people to sign up to a database… totally inappropriate I’m sure you’re all thinking!
As you would expect people were annoyed which led to Habitat deleting its offensive tweets replacing them many product and sales related tweets.
What could Habitat have done instead?
Individually reply to everyone who complained and apologise for the spammy behaviour
Apologise in public
Given Twitter followers a special discount to be redeemed online
Ask Twitter followers what information/offers they would like to see to build value and interest
It’s ok to fail, but do it quickly and apologise publicly! If you want to read more on this, take a look to Social Media Today’s blog!
So what’s the main message?
Tone down the hard selling
Respond quickly to customers
Use lots of enticing videos and photos
Be creative
And perhaps.. unexpected!
So finally, I’d like to leave you with some academic DO’s & DON’Ts from Ramsay, (2010) to get you thinking from all perspectives…
DO put a communication strategy in place
DO develop a style
DO strike the right balance between conversation and sales
DO set limits for what is and is not to be tolerated in any channel
DON’T use social media for corporate communications
DON’T be afraid to vary strategy per channel
DON’T forget to update content
If you have the time I’d recommend looking at the social media etiquette specific to each channel here.
References:
Agichtein, E., Castillo, C., Donato, D., Gionis, A., & Mishne, G. (2008, February). Finding high-quality content in social media. In Proceedings of the 2008 International Conference on Web Search and Data Mining (pp. 183-194). ACM
Chaffey, D. and Ellis-Chadwick, F. (2012) Digital Marketing: Strategy, Implementation and Practice. Harlow: Financial Times Prentice Hall
Ramsay, M. (2010). Social media etiquette: A guide and checklist to the benefits and perils of social marketing. Journal of Database Marketing & Customer Strategy Management, 17(3), 257-261
Zarella, D. (2010). The Social Media Marketing Book. Canada: O’Reilly
The average person is reputedly exposed to 2,000 or more marketing messages every day, a figure that might take you by surprise! As Weber, (2009) states, marketers should participate, organise and encourage social networks in which people want to belong. This encourages vital engagement; instead of talking at customers, marketers can talk with them. The social web has become the most effective way in the history of the world to do this, on a large scale (Weber, 2009). Therefore as a start-up company, social media can be invaluable, so take a look at these HOT tips!
10 HOT benefits for start-ups:
Easy to learn about your audience
The key to success is knowing your target market, for any business across all industries. Now social media has such a huge impact on consumers, businesses are acknowledging the impact on brand reputation (Kaplan, & Haenlein 2010). Facebook Insights in Hootsuite is a tool offering valuable information such as, age, gender and dominant languages spoken, helping to aid offers and campaigns ultimately increasing profits.
Helps to target audiences effectively
An effective way to send marketing messages to a specific demographic or specific audience based on locations can be achieved through geo-targeting. For example, Google News site automatically identifies local content based on IP addresses and other geo-targeting technologies (George & Hogendorn, 2013). Platforms such as Twitter and Facebook have tools allowing organisations to communicate appropriate content to the appropriate audience. Hootsuite can target by; education, language, age, location and many other aspects. If you want to send out a post to people who live in London, geo-targeting is an successful tool to utilise.
Helps to develop audience and entice new customers
An essential part of success for a start-up organisation is to expand their potential customer base and to locate current customers. Using geo-search in tools such as Hootsuite on Twitter, can allow small home furnishing start-up retailers to locate anyone tweeting about home furnishings within a selected area. After locating those twitter users, it’s possible to invite them to purchase goods using a unique promotional offer from your organisation, ultimately encouraging loyalty and potentially online and offline word of mouth marketing. Marketers are aware of the importance of this channel, which now affects the majority of all purchase decisions (Dichter, 1966).
(Kozinets, 2010)
It is important for start-ups to understand the academic theory behind word of mouth evolution, as shown in the image above, before interacting in any social media presence as poor word of moth marketing can ultimately damage brand reputation.
Instant feedback from customers
As an organisation, being active on social media gives immediate access to strong or weak feedback. This access is incremental in providing valuable insights into customer perspective with the ability to interact, increasing brand reputation and rectifying any damaging feedback with the aim of providing excellent customer after care. If you launch a new range of home furnishing products, organisations can learn from social media which features they like or learn how they style their homes and which products they would like to be sourced. This can lead to brands bringing out new products based on what their customers desire.
Staying ahead of your competitors
Want to access important information on your competitors? Another useful tool is social media monitoring which can improve organisations market intelligence, therefore staying abreast of all movements that can affect your own sales and profitability. This can guide strategic business decisions such as developing your organisations product range to offer diversity that competitors might be lacking.
Increase traffic and SEO
Social media will direct people straight to your website (although only ensuring increased sales if the usability is great!). The more shares that your oganisation receives; the higher up the search engines you will be placed, showing organic growth.
(Takes, 2011)
The above diagram shows the importance and significance of each social media platform in correlation to search engines and website traffic.
Easier & faster to share content
A vital part of ensuring engagement is making sure you organisations social media content aligns to the brand values and targeted audience. This can encourage customers to share your content and a faster rate! Businesses can use social media specifically to build awareness of new products/ranges, simply by sharing it on the organisations social network platforms that it’s active on! Easy Peasy you might that.. however it is important to emphasise the importance of relevant content. For example, as stated in my previous blog reasons that customers Unlike brands on Facebook can be for the following reasons; post too frequently, repetitive posts, stopped liking the brand in ‘real life’ and boring content. So it is important to steer clear of these.
Meaningful customer relationships created
Social media platforms can be an excellent tool to create two-way relationships with customers and potential customers. For example, Urbanara customers can show feedback through Trust Pilot. Two-way dialogues are essential in creating customer loyalty as it is fast and very personal, something that traditional marketing campaigns will never achieve in comparison.
Still not convinced? Take a look at this blog from Clickz, on how you can build customer loyalty through social media!
Increase brand awareness with minimal budget
Traditional advertising methods are known to have much higher costs in relation to the costs associated with social media strategies. It’s now becoming popular for companies marketing departments to start hiring community managers to adopt relations with online audiences across many regions and markets.
Enrich the customer experience
The core function of social media is a communication channel, in the same way you would pick up a telephone to make a call or send an email. Each individual interaction poses itself as an opportunity to visibly validate your customer service skills.
The above hot tips are a great guide for start-up companies if considering social media as a means to expand their brand. However, it is important to recognise that this is just a guide!
It is advised that some critical analysis should be done of the external environment, as this is likely to affect consumers and possibly the way they use social media.
For example, the following can heavily impact on a consumer and therefore your organisation:
Economic changes – this can include inflation / tax rates which can impact consumer confidence. Ultimately you as an organisation may be active on social media but if consumer confidence is low this may not result in an increase in sales through these channels.
Laws – consumer protection / environmental and environmental legislations are always changing. This can impact on costs and therefore may take away from the cost of having social media resourced the majority of the time.
Changes in technology – this has become significant since the millennium. Communication technologies are evolving constantly, so it is important to be aware of latest developments as falling behind with social media channels can devalue your brand!
References:
Dichter, E. (1966), “How Word-of-Mouth Advertising Works,” Harvard Business Review, 16 (November–December), 147–66.
George, L. M., & Hogendorn, C. (2013). Local News Online: Aggregators, Geo-Targeting and the Market for Local News. Geo-Targeting and the Market for Local News
Kaplan, A. M., & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of Social Media. Business horizons, 53(1), 59-68
Kozinets, R., Wojnicki, A. C., Wilner, S. J., & De Valck, K. (2010). Networked narratives: Understanding word-of-mouth marketing in online communities. Journal of Marketing, March
Takes, F. (2011) Search Engine Optimization. Leiden University
Weber, L. (2009). Marketing to the social web: how digital customer communities build your business. John Wiley & Sons
Do you have a profile on the popular free social networking website Facebook? Do you know anyone that doesn’t? No? That’s because as of the 3rd quarter of 2014, Facebook had 1.35 billion active users and we can be sure that this number is growing!
‘Friendships’ on Facebook can be taken very seriously and it seems like the entire world has been turned on its axis when you realise that someone who you considered a friend, has deleted, unliked or in the worst case scenario…. unfriended you. The same can be said for Business’s on Facebook and as much as we try to act cool, it is a big deal. So what drives people to do it? Easy enough… you irritate them!
Now here are some interesting statistics for you to consider taken from a survey conducted by Lab42. Close to 90% of users on Facebook say that they Like at least one brand on Facebook with a huge 50% finding that the Brands Facebook page is more useful and informative than the company website. Coca Cola has the largest audience on this social networking platform with a whopping 94,035,545 total fans, which isn’t a surprise as its simply one of the most recognisable brands in the world! (we all know it’s Christmas when we hear the jingles of the Coca Cola advert!)
Facebook represents a way for individuals to continue their offline relationships and conversations in an online medium (Hollenbeck &Kaikati, 2012). This convenient toolbox allows users to congregate into like groups and therefore continuously reinforces an array of meaningful associations strengthening an identity. However, it is important to recognise that this can also create ‘not me’ identities as Hollenbeck and Kaikati, (2012) states which can have a negative effect on the engagement with a brand.
Unlike
Opinionated and controversial posts, bragging about yourself and begging for likes are all ways in which your so called friends are more than happy to find that delete button, but as a brand on Facebook, what causes its fans to bolt?
Brands post too frequently
People don’t want to see an advertisement everytime they look at their timeline.
Repeating the same posts
Companies can make the mistake of repeating their messages in 2-4 hour intervals with the hope of increasing visibility.
Stopped liking the brand in ‘real life’
This can be down to bad customer experience.
Boring content
Instead brands should be highlighting specific products and messages and conveying them in an innovative way.
On the plus side, social media users still find Facebook Brand pages highly valuable. I hope you aren’t bored with the statistics because there’s more heading your way! Using the same study for the purpose of consistency, 87% of people on Facebook Like brands with 82% thinking it is a good place to interact with brands and finally 75% of people feeling more connected to a brand.
So now we know the significance of Facebook brand pages, how do we ensure that people don’t do the unthinkable and Unlike them? Easy enough… don’t irritate them!
Monitor the frequency of your posts
Reduces potential annoyance and if need be post different messages in-between to avoid repetition
Page Post Targeting
Targeting your posts to specific audiences based on gender/location etc increases the relevance and reduces irritation.
Like
Now lets get to the interesting stuff, what drives us to engage and Like a brand on Facebook?
Coupons & Discounts
The number one motivation, according to Lab42 is Coupons and Discounts.
Interact on a Brand’s page
Through engaging and different content – funny content always engages with fans.
To learn about new products
Firms can also ask users for ideas or new features they would like to see – great idea as a mini focus group
Lego is exceptional at creating unique content for each of its social channels, inspiring fans to follow them on a variety of platforms without getting bored of the same message.
For example, the Facebook competition shows strong commitment to engaging in conversation. Personal communication and value of the competition revolve around being personal, which follows the pyramid of engagement from Guosong Shao (2009) where the ultimate goal is the producing for self-expression and actualisation.
The strategy is to debut its latest coffee concoctions on Facebook – product marketing packaged in the lifestyle of Starbucks engaging the consumers of it’s 38M likes. They have many tabs including employment oppurtunities/interactive consumer polls -providing great information without doing any annoying selling!
These brands strive to create and consolidate fan communities (Pereira et al, 2014). Therefore, companies must be willing to devote continued and dynamic resources towards the brand profile, supplying users with unique content they need and want once involved with the brand on Facebook (Pereira et al, 2014).
Troubled Brands on Facebook
Dell
Blogger Jeff Jarvis expressed negative experiences with his new Dell laptop and the brand didn’t respond swiftly enough causing a big debate on Facebook that hurt Dells online reputation.
Nestle
Deleting a video and critical comments regarding purchase policies for palm oil led to accusations of a lack of transparency. This is a case of not allocating appropriate resources to manage their brand presence.
(Gamboa & Concalves, 2014)
Critically analysing where these Brands went wrong, it is quite apparent to see that they have not conducted enough prior research before interacting with the essential target customer base. For example, responding swiftly is a basic must when interacting on social media in order to create positive perceptions. This could have easily been avoided and therefore brand reputation would not have been damaged.
On the other hand, having the resources available at all times ready to respond can be costly to an organisation. Perhaps Dell were short staffed that day? and perhaps a contingency plan was not put into place.. something that hopefully Dell have now rectified.
Another factor to consider for Brands is how much time consumers are spending on social media today. Here’s an insightful blog from Business Insider looking at the surprising facts about how much times is spent on the major social media networks.
A finishing note:
Looking at the above honeycomb of social media framework by Kietzmann, Hermkens, McCarthy & Silvestre, (2011) this is a great way for brands to really see how different building blocks integrate and play imperative roles on one another. Take a look at this academic paper here! This can ensure the correct preparation is done to enhance the brand engagement on Facebook and on other social media platforms, to avoid becoming a laughing stock or annoyance for consumers online.
References:
Gamboa, A. & Goncalves, H. (2014). “Customer loyalty through social networks: Lessons from Zara on Facebook”. Business Horizons, Vol 57, Iss 6, pp709-717
Hollenbeck, C. R., & Kaikati, A. M. (2012). Consumers’ use of brands to reflect their actual and ideal selves on Facebook. International Journal of Research in Marketing, 29(4), 395-405
Kietzmann, J. H., Hermkens, K., McCarthy, I. P., & Silvestre, B. S. (2011). Social media? Get serious! Understanding the functional building blocks of social media. Business horizons, 54(3), 241-251
Pereira, H., Salgueiro, M., & Mateus, I., (2014). “Say yes to Facebook and get your customers involved! Relationships in a world of social networks” Business Horizons, Vol 57, Iss 6, pp695-702
Shao, G. (2009) “Understanding the appeal of user‐generated media: a uses and gratification perspective”, Internet Research, Vol. 19 Iss: 1, pp.7 – 25
Millions of us have at least one, or typically, a purse/wallet full to the brim of loyalty cards from a variety of Retailers. To be precise, a report from YouGov reveals that a whopping, three-quarters (76%) of British consumers say they carry between 1-5 cards with them at all times.
Economic hardship has encouraged an increasing number of consumers to hunt for bargains as household budgets have tightened. The question is how to retain your customer base and do it right?
This blog will give a guide on what makes a successful loyalty scheme for the Retailer. It will look at certain Retail success stories that have encouraged consumers to stay loyal, as these customers are also its most profitable (O’Brien & Jones, 1995). So it’s no surprise that more companies not fewer, are jumping on the bandwagon, spending millions of pounds developing and implementing reward programs.
The development of long-term relationships plays an essential role in enhancing customer loyalty and profitability (Kalwani & Narayandas, 2011)), therefore creation and maintenance to support this needs to be customised.
The customer loyalty scheme is one example of the continual blurring of the boundaries between direct marketing and ‘mainstream’ marketing, relying as it does upon a customer database and direct communications (O’Malley, 1998).
The question is, what makes a successful loyalty scheme for the Retailer?
Applied analysis of consumer data to predict future purchase. Targeted campaign activity based on communication preferences can be tested to check the accuracy of the prediction model. Fundamentally, continual testing to determine the learning from each campaign can be applied to the next. However practitioners often think data collected is too complex to grasp and should be simplified.
Appropriate & sufficient business architecture, in order to understand which data elements indicates current and historical loyalty behaviour (either in store or across multiple channels).
The customer service centre. A sophisticated customer loyalty scheme involves several different parties, so must be organised efficiently and appropriately.
Database & analysis is critical to the schemes success. It must be able to handle large amounts of data quickly, reliably and efficiently with data quality being maintained in order to avoid a high volume of customer queries.
(Stone et al, 2004)
However, Retailers also need to take into consideration how Facebook has 800 million unique monthly visitors worldwide to make this social network one of the most visited sites on the Web. It has become quite common for customers to air grievances about brands on Facebook, which can impact the perceptions of people in their closed network. So, if a brand values it’s customer loyalty, listening and acting at the right moment is crucial. When a company responds to a complaint or negative review, 18% of unsatisfied customers become loyal customers and buy more (Gamboa & Goncalves, 2014)
Success Schemes
Tesco Clubcard – most popular loyalty card in the UK. Over 68% of the British population own one. This scheme excels because they know so much about your shopping habits. With this wealth of data, Tesco can tailor your coupons, as well as allowing you to redeem points against a huge variety of products (holidays/groceries).
My John Lewis/Waitrose – just for creating an account with John Lewis you are rewarded with free coffee and cake every month, without spending a penny! You also gain insider tips, news, product previews, invitations to local events and exclusive offers on products to match your shopping habits! According to Mark Price, Managing Director of Waitrose, “loyalty cards are meaningless – consumers want immediate rewards”.
Boots Advantage – UK’s third most popular loyalty card. For every £1 that you spend you earn 4 points – equivalent to 4p (this can really add up!) You also get access to coupons and discounts as well as free Boots magazine every month with further coupons.
Failed Schemes
Air Miles – The globally successful Air Miles program failed when it was launched in the US market, mainly due to the complexity of redeeming benefits. The program lost $25million in its first year and subsequently shut down.
Ikea Family – rewards customers only with discounts on select products and throw-ins (free coffee). There is no points system and no accumulation based on spend, with no reward.
Common mistakes to avoid:
Not treating high value customers differently
Pretending to treat high value customers differently
Offering too narrow a rewards earning period
Being stingy with payout
If you are interested in finding out more on mistakes to avoid then check out the Whitepaper Forte Consultancy did here – http://bit.ly/1znwW4A it gives a really detailed insight into loyalty schemes gone wrong!
References
Gamboa, A. & Goncalves, H. (2014). Customer loyalty through social networks: Lessons from Zara on Facebook. Business Horizons, Vol 57, Iss 6, pp709-717
Kalwani, M., & Narayandas, N. (2011). Long-term manufacturer- supplier relationships: Do they pay off for supplier firms? Journal of Marketing, 59(1), 1—16.
O’Brien, L., & Jones, C. (1995). Do rewards really create loyalty? Long range planning, 28(4), 130-130
O’Malley, L. (1998) Can loyalty schemes really build loyalty? Marketing Intelligence & Planning, Vol. 16 Iss: 1, pp.47 – 55
Stone, M., Bearman, D., Butscher, S. A., Gilbert, D., Crick, P., & Moffett, T., (2004). The effect of retail customer loyalty schemes—Detailed measurement or transforming marketing? Journal of Targeting, Measurement and Analysis for Marketing, 12(3), 305-318
‘Urbanara provides the world with beautiful, high quality homewares, without the sky high price tag’
Founded in September 2010, Urbanara is an online brand which carefully sources each product from around the world. Online Marketing and the company website is a major way of attracting their customers. The top keywords that Urbanara’s potential customers might use, include:
luxury blankets
homeware online
UK homeware
Competitors include companies such as:
A brief look at these competitors shows that keywords that users may search for, resulting in the above could also be used to increase traffic to the Urbanara website. Ultimately this could increase potential customers and increase the awareness of the brand, something a recent start up company will strive for. These keywords include:
home furnishings
decorative accessories
Companies now need to consider many external factors when it comes to their brand reputation and and strategic position within the market. N.Booth 2011 says “Consumers are now the individuals broadcasting personal or second-hand stories to their social networks and the world. They are a brand’s storytellers and the new brand ambassadors.” So how can a company like Urbanara control these external factors?
For example, homeware bloggers could be a main influence on Urbanara such as http://www.designhunter.co.uk (a UK interior, design and lifestyle blog). Another influence would be social media conversations between previous customer experiences who then share their perusal stories for perhaps, social benefits or self enhancement and promotion. By taking an analytical approach to these influencers, Urbanara can listen and should act almost immediately to continue consumer conversations about the brand, as they are now brand embassadors. As Booth and Matic discuss, “control is an illusion, companies cannot control the conversations with social media, but they can influence them”.. something that should be at the heart of every social media campaign in order to generate measurable results.
Booth, N., Matic, J.A., 2011. Mapping and leveraging influencers in social media to shape corporate brand perceptions. Corporate Communications: An International Journal 16, 184–191
This week’s blog will be looking at Email Marketing from one of Europe’s annual Music Festival held in Croatia, Hideout Festival. I will be using an example I received in the 4th November regarding the release of Priority tickets for the event taking place in June-July in 2015. This was an opt-in permission based email marketing campaign, triggered by an event.
Hideout Festival being something I actively invited into my inbox, with the desire to be ‘in the know’ about upcoming and useful information was a compelling enough reason for me to open this email. The Call to Action is visible even before this stage with the main purpose being to engage potential customers into purchasing Priority Tickets. After a brief scroll this action is immediately made possible with a Buy Tickets link appropriately placed in the centre of the page which will further take you to the again appropriate, landing page. In relation to Hernandez and Resnik (2013), user scan patterns can be of great importance due to the typical nature of following the visual hierarchy of a page. The Inverted Pyramid shows the top of the page as having the longest gaze duration, therefore including information such as the date of the event and the primary intent of priority ticket awareness. With attention funnelling down the page with freedom to break off, information such as the Line-Up is shown. This is reinforcing information from a prior email therefore not ultimately beneficial to be shown in the subject line or within the most volumes part of the email.
Is this email powerful enough for me to take the action? I have not yet bought a priortiy ticket. This could be down to many external factors although it could also be down to lack of personalisation. It would of been pleasing to have my name within the subject line, or my name within the content of the email, just to make it a little more ‘special’. Perhaps having no facility to ‘share’ this event among social media and my friends, could also be a reason why there has been little conversation in regards to planning this trip.
Overall, this email does what it says on the tin. From the moment it entered my inbox I knew exactly what it would be about. The visuals of this email make it look fun and far from dull to look at, with images and text being broken up. The patterned outlined by Hernandez and Resnik (2013) feels like the best format. Due to the nature of the event, there are a string of follow up emails ensuring every piece of new information available is sent out, therefore having the newest piece at the top matches the path of my eye as I scan through.
Hernandez, A., & Resnick, M. L. (2013, September). Placement of Call to Action Buttons for Higher Website Conversion and Acquisition An Eye Tracking Study. In Proceedings of the Human Factors and Ergonomics Society Annual Meeting (Vol. 57, No. 1, pp. 1042-1046). SAGE Publications.
Big Data is becoming a big trend within many industries such as Retail and Airlines, for many important factors. For example, the Retail industry has increasingly become more of a 360 degree experience where consumers are expecting all channels to seamlessly integrate. Big Data allows companies to track everything their consumers are looking at online and even how they navigated there. Airlines are using this to improve their ETA’s in order to increase their effeciency. Ultimatley this will enable a better coordination between all staff involved in an airplane approach, by eliminating gaps of estimated and actual arrival times. This is done by combining public data about weather and flight times from air traffic control.
However, there are differences between ‘Big Data’ and ‘Analytics’:
Volume: companies that are born digitally such as Amazon and Google are masters of Big Data.
Velocity: speed is as/more important than volume.
Variety: using messages/updates/social media for ultimate engagement.
To conclude, Big Data can play a significant role in Marketing for many firms across a wide range of industry. Retail firms can track their consumers thoughts in many ways, which can help measure and manage more precisely how their shoppers ‘think’. Firms can tailor many promotions and offers targeted to their key audience and consumers in order to increase their spend and loyalty.
Big Data leads to smarter decisions.
McAfee, A., & Brynjolfsson, E. (2012). Big data: the management revolution. Harvard business review, 90(10), 60-66.
