Article

GlobalShop 2012: Why leveraging social shopping will lead to better sales

Retailers need to use social shopping trends to their advantage.

March 1, 2012

Thanks to the mobile phone, shopping is a social event even when a consumer is in a store by herself. She may use applications on her smartphone to get more product info, snap photos to post on Facebook or compare prices, all of which are examples of social shopping.

More than a trend, social shopping is the latest way for retailers to engage customers, and it's not going away, said Kurt Karlenzig, global vice president of The Marketing Store Wolrdwide, when he addressed a group of retailers Thursday at Global Shop in Las Vegas.

Social networking sites like Facebook and Twitter also make it easy for consumers to interact with one another before, during and after the point of purchase, but social shopping consists of a few other elements as well. If used correctly, retailers can use the following social shopping trends to increase loyalty among consumers, which leads to sales increases:

• Shopping apps and tools
• Group deals
• Shopping communities
• Recommendation engines that allow shoppers to provide advice to fellow shoppers
• Social shopping marketplaces that bring sellers and buyers together.

Shopping apps: About 50 percent of smartphone users have downloaded a scanner app to use while shopping, which Karlenzig said is proof that people rely heavily on their phones while shopping in stores. One of the most popular shopping apps available now is RedLaser, a free scanning app that's been downloaded more than 15 million times. It allows customers to scan a product's UPS code or an in-store QR code to compare prices of products online and in store. RedLaser searches for the best prices with TheFind, Google Product Search, eBay and Half.com.

More than half of U.S. smartphone users performed retail research while inside a store in 2011, Karlenzig said.

Group deals: Since the success of Groupon, tons of companies have popped up to provide similar services. Living Social is another platform that understands how important the social aspect of shopping is. It not only gives its customers daily deals, but it also rewards them if they share the deal on their social networking sites. For example, if a consumer gets three of his friends to purchase the deal from this link, he gets his free.

Shopping communities: Fashion retailers probably benefit most from these types of websites, as fashionistas often like to converse about trends online. Justboughtit.com is a site where consumers upload photos of their purchases and wait for others to comment on them.

Recommendation engines: Amazon.com is one example of how social shopping has become; it takes word of mouth to a whole new level, allowing consumers to read one another's ratings before buying. The important thing to remember is that a bad customer service experience will surely travel far and wide.

Social shopping marketplaces: Sites like Etsy.com not only bring together artists and people who want to buy handmade creations, but it's also a social media site, where users share ideas and educate one another. Users can post info about what they've purchased and why.

Getting started

Retailers can use social shopping to their advantage as long as they know how to leverage each channel correctly.

"You have to understand how the social network functions before you build your presence," Karlenzig said. "You have to determine what your voice will be and always think about what people will share. Most people don't share taglines."

For example, Starbucks allows customers to post ideas about what they'd like to see at Starbucks. Other users vote on their favorites and leave comments. This creates an interaction between consumers and the Starbucks brand.

Another important thing for retailers to keep in mind is that customers expect immediate feedback. For example, if a consumer posts a negative comment on a retailer's social networking site, it's imperative that someone addresses it immediately.

"You can't wait days," Karlenzig said. "You have to always have someone to respond."

Read more about consumer behavior.