Retailers success through community driven marketing

Community driven websites offer retailers and consumer goods companies a new business model to capture the market by being a part of ongoing customer interaction. The key to success of consumer driven marketing is the social media – interactive sites where people form a community and share information, idea, experience about a product or services. Retailers such as Netflix, a US$1.3 billion online movie rental service with more than 15 million subscribers, have successfully deployed fully personalized social site where personal recommendation are made transparently and huge focus is given to the community. Amazon, a global e-tail leader with more than $31 billion in sales in the 12 months ended October 2010, is another successful online retailer. The key to success of these retailers is that they provide personalized recommendations driven by their proprietary customer master database that also provides cross-selling and up-selling opportunity based history of customer activities.

Given this increase in usage of social media, it is also important that retailers maintain a consistent message across the increasing variety of these social media. Retailers can use old spice method of spreading a consistent message. Old spice instead of just posting a YouTube video and a link in Facebook, it solicited the responses from the followers of its various networks. Old Spice simply asked its connections to submit questions to the “Old Spice Guy.” The old spice guy answered dozens of questions, all posted on YouTube. These made the ads for the deodorant to become enormously popular. Retailers can use similar strategy of using their connections to pose their questions and an expert answering them on YouTube. This would help the retailers’ brand seem much more relevant and well connected with the community.

With increasing adoption rates for smartphones and tablet devices, retailers should include new mobile and social media technologies as the part of their brand’s strategy. Retailers can best take advantage of Foursquare (a smartphone application that lets people automatically alert friends to their location with GPS technology and win rewards — discounts, T-shirts, and other prizes — for recommending products and stores to their circle of online acquaintances) by offering coupons and other promotions for purchases and by providing special offers to the most loyal customers. Retailers should also understand consumer behavior, such as understanding how consumers engage with products and services online, before deciding their strategy. By this way of constant engagement with the customers, retailers build trust and relationship with the customers. Through this social media engagement, retailers have a chance to prove the customers that they are transparent. By delivering what they promise and offering transparent return policies, retailers build consumer confidence.

These measures by the retailers are important to make sure that the retailers are a part of the community conversation. These make a company engage with the community more meaningfully addressing the needs of the customers.