The Consumer Matters is the blog of Leslie Grandy, aka Gearhead Gal.  My passion is creating and delivering compelling products that delight customers through simple and elegant user experience design.

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Entries in social commerce (3)

Thursday
May172012

Have We Seen the End of Facebook Stores?

This guest post was written by Lior Levin, a marketing consultant, and contributor to The Consumer Matters.

Citing sluggish sales, a number of leading brands such as J.C. Penny, Gamestop, GAP, and Nordstrom have shut down their Facebook stores. Bloomberg News reports that contrary to the optimistic projections for Facebook’s “F-commerce” solutions for social shopping, many brands found that their stores simply did not perform well on Facebook despite generating plenty of likes and buzz.

Is this the end of Facebook stores or just a big bump in the road toward “F-commerce.”

Facebook Specializes in Social, Not Sales?

Perhaps the largest debate among marketing analysts right now is whether Facebook is better for social networking and connecting with friends than selling products.

Sucharita Mulpuru, an analyst at Forrester Research in Cambridge, Massachusetts, shared in the Bloomberg News article, “There was a lot of anticipation that Facebook would turn into a new destination, a store, a place where people would shop… But it was like trying to sell stuff to people while they’re hanging out with their friends at the bar.”

The jury is still out here. While many Facebook users prefer to avoid shopping during their social time online, the user base of Facebook is large enough to consider whether this will always be the case for the majority of users.

Optimizing the Facebook Shopping Experience

Another concern with Facebook stores is that retailers failed to adapt their merchandise for the Facebook browsing experience. For example, some large retailers have put their catalogues on Facebook, like Express , leading to a slower browsing experience. 

If customers can just go to a retailer’s website in order to make a purchase quickly, there’s no longer any incentive to shop on Facebook. In addition, seasoned online shoppers may be used to the browsing experience on a company’s website over learning a new interface on Facebook.

Questions remain, such as whether retailers need to think of products designed especially for sale on Facebook or what number of products is ideal for selling on Facebook?

Are Other Social Networks Better for Online Shopping?

Is it possible that Facebook simply doesn’t have the infrastructure in place to provide the ideal online shopping experience compared to sites like Pinterest? While Pinterest is designed for click-throughs and browsing images of products in use, Facebook specializes more in communication and interaction.  

Maureen Mullen chief researcher at luxury think tank L2 advised brands  to do the following on Facebook: “Fans really want to hear more about products and want to interact with the brand itself… Provide users with content they never would have had access to without the advent of social media, share different perspectives and allow fans to share what they think in real-time.”  This kind of unique product viewing is not what we typically associate with Facebook anymore since it fits the niche of Pinterest perfectly.

When it comes to focusing on a product, it’s tough to beat the clean viewing experience of Pinterest.

Using Facebook to Drive Traffic

Rather than opening Facebook stores, other brands are focusing on using Facebook to drive traffic to their websites in order to close sales on their brand websites. It’s clear that Facebook is an essential online marketing tool, but how brands use their Facebook pages for sales will continue to evolve.

Maureen Mullen shared with Mashable ,“[Burberry is] using the platform to drive traffic at a fraction of the cost of what it would have to pay on Google and other search engines. In addition a significant portion of that traffic and resulting sales is likely incremental.”

Facebook is still an essential tool that links brands with higher sales and greater brand awareness, but brands still aren’t sure about using Facebook directly for sales.

Do Consumers Need More Time

As GAP, J.C. Penny, Nordstrom, and Gamestop rethink their Facebook strategies, it’s possible that these brands invested too much, too soon into Facebook stores. Customers may not have been ready to make the leap from social to shopping. 

The All Facebook blog suggests: “Consumer resistance to shopping on the social network reminds us of how people felt about shopping on the Internet back in the early-to mid-1990s. Once they became more comfortable with the technology and more confident about the security, people began buying things on the web. The same pattern might occur with Facebook commerce.”

While it’s clear that many leading brands have lost money on their Facebook store investments, we’re still in the early days of Facebook stores. It’s still quite possible that consumers will warm up to social shopping or that other brands will create an ideal Facebook shopping experience. Facebook stores aren’t finished, but we are certainly in a period of uncertainty now that the initial euphoria of F-commerce has passed. 

About the author:  Lior Levin is a consultant for a printing company that offers a variety of smartpress options, and who also consults for a neon sign store that provides customized neon signs for businesses and individuals.

Sunday
Apr152012

Guest Post: How Luxury Brands Can Prepare for Affluent Millennials

This guest post is written by Lior Levin, a marketing consultant for a company that provides a to do list app for businesses and individuals, and who also consults for an inspection company that offers various Pre shipment inspections in China.


Millennials, meaning those between the ages of 18 and 29, are easily the fastest-growing market for luxury goods. Not only did they spend 31% more on such goods in 2011 than they did just one year prior, but due to their age, they have the potential to continue that growth for a lot longer than their older counterparts.

Clearly, Millennials are going to be a core target for luxury brands, however, they also pose an interesting set of challenges. Simply put, Millennials don’t buy luxury products in the same way as baby boomers or other generations nor do they value the same things in a luxury brand.

If luxury brands are going to appeal to Millennials, they need to start thinking about how to shift their marketing and their message to prepare for a very different type of consumer with very different wants and needs.

Luxury Alone is Not Enough

One of the biggest differences between Millennials and boomers is that, for Millennials, saying that a brand is a luxury and pricing it accordingly is not enough to convince them to buy.

Previously, buying a luxury good was as much about showcasing wealth as it was buying a superior product. Simply pricing something higher and marketing it as exclusive was enough to get most luxury buyers in the door. However, Millennials want to know what they are getting for the extra amount they are paying and how it will benefit them.

A recent study by Luxury Society found that shoppers favored quality, craftsmanship and design over brand name when promoting a luxury brand, making these elements key to showcase in any promotion.

If you can’t convey clearly why your brand is worth more than cheaper alternatives, Millennials will not be likely to spend their money with you. They simply feel no need to show off their wealth and will gladly buy a cheaper product if they feel it’s of the same quality and meets the same needs.

The Human Element

Luxury brands that do well with Millennials, such as Whole Foods, do so in large part because they focus on the human element of selling and marketing.

This includes both telling the story behind their brand and their products (including how and where it was made and who made it), but also treating the customer with respect and looking out for their best interests beyond merely trying to get the next sale.

Whole Foods stores tend to be warm and inviting places, Apple Stores tend to have legions of well-trained staff, and they do so not to ensure that they maximize sales, but to provide the best customer experience possible.

However, this appeal comes at price. Whole Foods doesn’t carry a lot of high-margin brands that don’t fit with their image and Apple Stores tend to have a lot of wasted floor space. But like all human connections, it’s a matter of give and take. The brands that give more to their customers will find them more willing to buy from them.

Brands that have thrived on being exclusive and unapproachable are going to have to change their customer-facing operations to better appeal to younger consumers that seek out a more human connection with what they buy.

The Use of Technology

Obviously, Millennials are much more comfortable with and eager to use technology than their older counterparts. Millennials grew up in a post-Internet age, and they expect the brands they buy, especially luxury ones, to be tech-savvy as well.

This use of technology isn’t just about how brands promote to customers, such as with online campaigns or high-tech in-store displays, but also about how they communicate and maintain contact with them. Email newsletters, text alerts, live chats and even video conferencing are just some of the ways brands can keep in touch with customers or have their customers contact them.

Luxury brands need to be where their customers are, and this means online, on social media and on mobile devices. This not only increases convenience for the customer, bringing the brand to them rather than the other way around, but it helps keep the name relevant and modern, two things Millennials value.

If a brand can’t stay current, it’s likely to be left behind and forgotten by younger customers.

All in all, Millennials are far more demanding of luxury brands, and they don’t necessarily reward the brands that they do purchase with an increased amount of brand loyalty. Millennials, as a group, tend to enjoy exploring and trying new things, even if it means leaving behind a brand that worked hard to get them as a customer.

Turning Millennials into customers isn’t going to be a matter of creating an exclusive group and daring them to join. Even the wealthiest Millennials don’t feel the need to flaunt their wealth or be a part of a “club”.

Millennials want facts to back up their purchases, a real human connection with the company they’re buying from and to have access to their brand wherever they are and whenever they want to.

Providing that is going to mean making a major shift for many luxury brands but those that can do that, such as Apple, will be able to ride the wave of the fastest-growing and, most likely, longest-lasting growth segment for luxury goods.

Those that don’t, such as Cadillac, will likely find themselves being viewed as antiquated and struggling to reach a younger audience as their current target market ages.

Wednesday
Dec022009

Yakaboutit.com Helps Inventors Find an Audience

With news that another 169,000 jobs were lost in November, the ranks of the unemployed have swollen and the opportunity to find new employment has diminished. For some impacted by a job loss, the only answer may be to go into a different line of work, and re-train for another career. For others, the circumstances create the best opportunity to start a business or pursue a dream or invent a breakthrough product.

Fortunately, garage inventors now have a platform to launch that great idea. Yak About It is a site dedicated to evangelizing these homegrown inventions and creating opportunities for the world to notice the little guy with the big dream.

The site provides community and commYakaboutiterce tools and delivers inventors feedback on price and design. Yak About It also facilitates awareness through social media, which may create distribution opportunities the inventor may never have uncovered.

 Click here to read more...