Seeking increased customer engagement

It’s not news to online retailers that social media adoption is on the rise. Three-quarters of US Web retailers surveyed by the e-tailing group and PowerReviews in August–September 2009 for their “Community and Social Media Study” said they thought brands were accelerating their use of, and commitment to, social media.

More than one-half of Web retailers surveyed already use five of the 10 community or social media tools, and only tiny percentages had no plans to use them later. Facebook fan pages were most popular, followed by Twitter and customer reviews.

But fears still abound. Online retailers remain worried about their own competence at using social media and losing control of their brand.

Their concerns also showed that retailers understand the importance of social media: One of their biggest fears was that customers would abandon their site in favor of one that was more socially engaging. Using social media might be scary, but avoiding it is becoming less of an option.

The primary social media goal of the retailers surveyed was to increase customer engagement, followed by boosting brand loyalty and spurring word-of-mouth among brand advocates.

Responding retailers believed customer reviews were the best community tool for driving engagement—and also the best for increasing sales.

“Customer engagement has become a metric to be reckoned with, where failing to engage consumers via community and social media will have brand and bottom-line implications,” said Lauren Freedman, president of the e-tailing group. “All merchants must test and understand how to effectively deploy it for their brands to retain customers, encourage sales and avoid abandonment to competitors who’ve better embraced its marketing potential.”

Source: eMarketer