FreshNetworks Blog

While a consumer drives down their road, what triggers their decision to go to Tesco as opposed to Sainsbury’s? As they switch on their laptop to shop online, is it Ocado.com or Waitrose.com they visit?

While the flat economy keeps consumer consumption weak, retailers are looking to pull levers other than just price to build brand loyalty.

Short term vs. long term customer loyalty

Price differentiation is clearly unsustainable and confusing for consumers in many cases. Whilst price matching might be good for the consumer in the short term, it negatively impacts the bottom line and does not lead to increased loyalty in the long term.

In a recent study by loyalty360 it was revealed that 84% of respondent retailers use some form of loyalty strategy, but surprisingly less than half (48.8%) believe their initiatives are working.

Therefore, what can drive loyalty in the longer term?

Having a single view of the customer is increasingly challenged by consumer uptake of multichannel. A consumer expects to be able to research a product or service using one channel, order it via another, and potentially take delivery via a third, with the expectation that the retailer is aware of each and every activity and delivering a consistently seamless service.

Consumers also expect the same authentic brand experience whether they are communicating via a brand’s website, social network, or speaking face-to-face with a representative.

How can social data be used?

So how can brands use social data to drive loyalty? How can it help make every moment memorable for the customer, while still affordable for the retailer? Beyond responding to customer service queries in twitter and other social networks where else can social build customer loyalty?

One way is by using social data to anticipate future customer behaviour. For instance, by seeing what is trending and delivering a better marketing message accordingly. This could take the form of tweaking a website in real-time, with the intention of more prominently displaying items customers are discussing online and showing a propensity to purchase. In this way the brand is clearly identifying with its customers in real time and using that data to make it easier for them to find the things they like.

Another example is if a customer has a goal to lose weight, their supermarket could use the data they have collected through a traditional loyalty programme (in relation to the customer’s food purchases), and make that data available to them to calculate their calorific intake. This data powering an app could then be used by the customer to manage their diet, making them more likely to continue shopping with that supermarket in particular because it is collecting their data and using it to benefit them.

These are just a few ways in which social can play a big role in driving and maintaining customer loyalty, and ways which give the customer benefits beyond discounts for being loyal.

Image credit: Karen V Bryan

Though there are several opportunities for using social media as a customer service channel, but while customers are using social media to lodge complaints, the majority of them are not receiving an acknowledgement or response from the service or product provider they are complaining about/to.

A few days ago, a piece of research conducted by Sage UK among 2,000 UK consumers found that while 22% of consumers would complain to a company using social media when they received a disappointing customer experience,  only 40% had received an acknowledgement as a result.

This is not just a problem over here in the UK. As reported in the Financial Times today, a survey carried out by social media management platform Conversocial in order to track US consumer expectations of social media found that while 51% of respondents were using social media to communicate with corporations,  a third of consumers who had attempted to communicate with companies via social networking sites were ignored.

Furthermore, 88% of respondents said they would be less likely to do business with that retailer if their complaint went unanswered.

With this in mind, businesses really need to make sure that their social media strategy assesses customer service otherwise they risk loosing not only existing customers, but also new customers, given that social media gives the casual observer the chance to see if, and how, a brand or business responds to a customer complaint.Social media makes the process of complaining a lot less confrontational and with the modern consumer expecting a better customer experience, businesses need to make sure they use social media in a way that adds value at all main customer touchpoints , including responding to complaints.

So why is there seemingly a reluctance to response to customer complaints in social media? Is it just that businesses are not listening out for complaints properly, or that they still don’t know how to respond? Perhaps it is still fear, in which case businesses need to start seeing the complaint as an opportunity to engage with the consumer directly, address their problem,  and then in some cases, turn a complainant into an advocate for the brand.

Either way, companies can’t afford to stick their fingers in their ears and ignore complaints or be slow to react to customers. As Dr. Tomas Chamorro-Premuzic of Goldsmiths University in London points out,  ”social media thrives on immediacy, so small issues can snowball very quickly if they are not responded to effectively and efficiently”.

By now we all know that social media can help put our customers at the heart of our business.

With this in mind, Lauren Carlson from Software Advice recently pinned down Brian Solis to discuss his definition of engagement.

Solis responded with what he calls the six rules of engagement: value, efficiency, trust, consistency, relevance and control. Let’s take a look at this to see how they can be applied as part of your engagement strategy:

1. Value

Consumers want to feel valued by the companies they do business with. Feeling valued translates to knowing that the company or brand will go above and beyond to meet your needs.

How to achieve this: Use social media to help you stay in touch with your customers in a personal way. In the “old days” this would be making a phone call, and there’s nothing worng with doing that today too, but you should also try to respond directly to tweets and other comments on social channels. You could also set up a loyalty program to reward return business, or offer discounts through social media channels to your most loyal customers to help them feel valued.

2. Efficiency

With the rise of new technology, particularly mobile, processes that used to be long and laborious are now happening much more quickly. Because of this, customers expect the same level of expediency when dealing with businesses.

How to achieve this: Consider how efficient your site is for mobile access and mobile purchasing. Also, instead of using call centers to deal with customer queries and concerns, think about using Twitter, Facebook or a live chat module for real-time support.

3.Trust

Consumers need to be confident in the credibility of your business and the product, actions and services that you deliver. With the rise of social media customers are trusting brand messages less and are turning to the advice of friends, peers and “people like them” to make their decesions.

How to achieve this: It’s been said time and again but be honest and transparent in all communications, across whatever channel. If a company builds trust through honesty and transparency, their customers will feel more confident to recommend the company or brand to others through social media. Don’t bombard your audience with your own brand messages and agenda; listen to what people are saying about you and join in the conversation in a natural, organic way to gain their trust.

4. Consistency

It is common for companies to offer multiple channels for communication with their customers. Offering multiple channels is a good thing, however there is no value unless the service you provide is consistent across each one.

How to achieve this: Don’t offer something you can’t deliver on. It is more valuable to have three consistent channels as opposed to six fickle ones that do not really engage with your customers. There is no point having a Facebook page or a Twitter profile just to have what you believe is a presence on there, if your customers are posting and commenting and getting no response or interaction.

5. Relevance

Many companies use social media as another means of advertising. They essentially spam social media profiles, blogs and marketing emails with product-centric information. However, that’s not what the consumer wants – engagement needs to be relevant.

How to achieve this: When potential and existing customers visit your blog, Twitter, Facebook page etc, they want to find information that is interesting and focused on their needs. Use social media monitoring to listen to what your customers are saying and identify your influencers or people who form part of your target audience. Engage with these people on their terms and only interact with them if you have a relevant message, or something of value, to offer them.

6. Control

We have heard over and over again that the customer is in control. But the idea of control is two-fold. It is clear that customers want a sense of control in that they want to choose the channel they communicate on, and they want the ability to opt in and out of specific engagements. In other words, they want an experience that gives them the sense of control.

How to achieve this: This is an interesting analysis of the word control. It puts the onus back on the businesses to still control the customer experience as a whole; it’s just that now, with the rise of social media, the customer can choose where and when they want to interact with a brand, if at all.  What Solis seems to be suggesting is that businesses should gain consumer insight and design an experience that provides the user the choice to interact with you or not (so ‘control’ in that sense of the word). Look at your key customer touchpoints to see where social media can add real value to your business.

Having already looked at the Facebook engagement and content strategy of two large rival consumer brands (Unilever’s AXE v P&G’s Old Spice) we thought it would be interesting to use social analytics tool Socialbakers to look at the engagement levels for another two rival consumer giants – Coca-Cola and Pepsi.

1. Fans

At face value, Coca-Cola has 29,368,850 more fans than Pepsi. Coca-Cola’s fan total stands at a whopping 35,454,838:

During October Coca-cola’s fans grew by 1,020,439  and Pepsi’s only grew by 188,349.

2. Engagement

We’ve always believed in building real engagement rather than “likes” or fans and so, to us,  the really interesting analysis comes when looking at the activity of Coca-Cola and Pepsi in terms of engagement.

Using Facebook’s “Talking About” metric, during October significantly more people were “Talking about” Coca-Cola instead of Pepsi:

While the people “Talking About” metric  seems to be fairly consistent for Pepsi, the increase and subsequent peak in people “Talking About” for Coca-Cola on 29th October could be because tickets for the Coca-Cola sponsored NASCAR Sprint Cup Series race at Daytona International Speedway  went on sale on Saturday October 29th.

However, even though more people were “Talking About” Coca-cola during October, in terms of other engagement metrics is appears as though Pepsi has the advantage:

Pepsi has an average engagement rate of 0.06% versus Coca-Cola’s 0.04%.  What’s more,  Pepsi has a total of 180,050 interactions (posts and comments) to Coca-Cola’s 117,964, again proving their higher engagement levels. Part of the reason behind this is that Pepsi used a lot of pictures and images to engage with its audience during October, rather than just links and text, thereby helping to generate a lot of interactions with the page.

Also, throughout October, Coca-cola made 21 posts, while Pepsi bordered on almost three times the activity with 53 posts, often posting twice daily. Updating and refreshing content on a regular basis is likely to have helped with Pepsi’s engagement rate.

So it seems that although Coca-cola has the more ‘famous’ Facebook page, with by far the most number of fans, in terms of engagement during October it seems that Pepsi is the winner.

It would be interesting to track this trend over a longer period of time than just a month to get a real understanding of the levels of engagement on each page.

Image courtesy of elliemaeink.blogspot.com

Who is your most valuable consumer?

The one who buys the most from you, the one who generates the most margins or the one who spends the most time in your stores?

Think the answer is “the ones who buy from you the most”? Well, think again…

According to Sudhir Holla, a consultant at Infosys, the answer to the above question has changed in the last couple of years, thanks to social media.

In his post on a Forbes, Holla claims that social media has altered the traditional controlled customer experience to one that is more similar to Multi-Level Marketing (or MLM).

Multi-Level Marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a down line of distributors.

In social media terms, this means the consumer’s voice has the power to influence others, helping to generate sales further down the line. So even though a consumer may just be “just looking” or browsing for a service or product, the fact that social media enables that consumer to spread an opinion about these services or products could help to generate sales further down the line.

This fact is particularly prominent on Facebook where discussions have centered around the fact that friends of fan on Facebook constitute an important incremental audience on Facebook – 34 times larger, on average, for the top 100 brand pages than the fans themselves.

So how do you leverage this trend? Identify your key consumers based not on spend alone but also by those who exert the maximum positive influence among your sector, audience, market or region, or by those who are influential about convincing consumers to buy the products or services offered by you.