Putting the 'Social' into social media
This article appears in the Mar/Apr 2016 issue of Business Franchise Australia & New Zealand
As the digital world continues to integrate itself into our lives, it’s no surprise this integration is emerging as a prominent part of businesses’ day-to-day operations, and the retail sector is no exception. Retailers are diving head first into social media to help create brand awareness, launch and run campaigns and, ultimately, improve sales. In the last decade, social media has moved from an emerging trend to a central pillar of any organisation’s digital marketing strategy, thanks to an exponential increase in use among consumers.
At BDO, we’ve just released our annual Spend Trend* report, which has revealed some interesting insights into how retailers are actively investing in their marketing to increase brand awareness in a bid to attract shoppers to local bricks and mortar stores. Spend Trend provides an annual health check for Australia’s $292 billion retail sector by analysing key 2014-15 financial ratios and indicators for 18 ASX-listed retailers, including Wesfarmers (WES) and Woolworths (WLW), as well as 13 US and UK-based retailers.
What we found was that Australian retailers boosted their marketing spend by 35.7 per cent in relative terms between FY14 and FY15, including investment in digital marketing to coincide with an increasingly mobile marketplace. This effort is not a mere half-asked attempt at engaging with social media, with many retailers now employing dedicated social media staff or appointing a digital marketing department to coordinate these efforts. Tools like Facebook, Instagram and YouTube are being used heavily, particularly in key sales
periods like Christmas or school holidays. This social media surge among Australian retailers has coincided with some encouraging growth in online sales, with many – analysed as part of the Spend Trend report – recording significant double digit growth in relative terms. However, they still have a long way to go if they are to match their international counterparts, whose online sales represent well over 10 per cent of their total revenue.
So while social media is becoming a fast-growing part of retail businesses, it’s important those giving it a go do so with a measured head, and commit to understanding its full scope before giving the green light. Perhaps more than any other sector, retailers will need to stay ahead of new trends and meet the changing demands of their customers. Social media can provide insight into these developments, offering platforms where people go to share, like and talk about what they want from a shopping experience. More importantly, an effective social media strategy that can drive concrete engagement also requires buy-in from senior executives who can offer oversight from across a retail business’ operations.
With that in mind, here are a few points on what executives within your business can do to help drive this development.
1 Ensure your company has an up-to-date social media strategy
Social media can be a rabbit warren if your company doesn’t have a clear understanding of what you want to achieve through its use. Establish whether you’re aiming to increase your brand recognition, inform customers of current discounts and promotions or manage customer feedback and complaints. Understand that all can be achieved, but only with a defined strategy. Lastly, make sure your strategy is integrated with your broader digital, marketing and sales strategies to not only ensure they don’t contradict one another, but to leverage and complement each other’s success.
2 Be aware of how social media is changing the way a company communicates with its customers and vice-versa
Social media is now a common forum for reviews, feedback and complaints, and as such can quickly damage your brand if you’re not responsive and do not communicate appropriately. Make sure to actively listen and engage with your customers; put a plan in place for how you communicate with the public in various scenarios. Ensure your social media team understands how to respond to both positive and negative social media posts and what policies are in place for formal complaints, product returns or general feedback.
3 Understand your audience
When determining your target market, you must figure out who they are, what social media platforms they prefer and how much time they are spending there. Then you can decide which platforms are the right fit to achieve your company’s goals.
4 Understand your company’s voice and how it is being portrayed through social media
If your company’s voice differs across its digital platforms, your brand will be diluted. Consumers will be confused about what your brand stands for so it’s important your content is harmonious and consistent across all platforms.
5 Measure – data is gold
Just as you do for almost all other parts of your business, it’s imperative to know whether your social media strategy is effective, so measuring its operation is important. The key is ensuring that what you are tracking fits your objectives. There are a number of recommendations for how to measure your social media return-oninvestment, from number of impressions, tracking traffic through to your website or store and to operational analysis such as number of complaints handled or number of enquiry responses / conversations directly with potential customers. Consider which are most important for the business and best reflect your business goals.
With all of this in mind, a social media strategy is something executives will need to be aware of and involved in if they want to see it add value to their organisation. The role of social media — both as a tool for communicating with customers and for achieving commercial objectives — is only going to grow in the coming years and businesses need to respond accordingly. For retail executives, taking the time to understand how their own actions can support a strategy will certainly help the company realise its long-term goals. That requires going beyond the technologies involved and understanding how to drive meaningful engagement with individual users.
John Bresolin is an Audit Partner in BDO’s Sydney office. He has over 20 years of experience and has worked with medium to large, private and publicly listed clients. John is retail specialist with extensive expertise in supporting retail clients. As an active member of the BDO’s Retail Partner Group, he authors two of BDO’s retail flagship publications - the annual BDO Spend Trend and Changing Tides: BDO Retail Market Update. BDO offers a wide range of business, accounting and corporate advisory services to large corporate organisations, Government & Public Sector entities, private businesses, entrepreneurs, and individual clients across a wide range of industry sectors.