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Luxury and Discount Retailers Seize Digital Marketing Momentum
With no one-size-fits-all solution, companies strive to stand out to core customers.
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Burberry's Acoustic campaign, a promotional effort that features different bands wearing and endorsing the brand's products, has been perhaps the most popular among its Facebook initiatives. Though the ads are not particularly unique and look traditionally true to Burberry's classic style, the campaign's exclusivity—it's only viewable by the brand's social media fans—has elicited a positive reaction, Moth asserts.

Similarly, Burberry often offers Facebook fans other exclusive opportunities, including the chance to travel and see a live fashion show. Burberry's team then documents the fan's experience, and shares it on the social media page, giving other fans an opportunity to enjoy the experience vicariously.

Burberry's older campaigns are also notable. In 2011, for example, Burberry released a new fragrance and shared samples with its Facebook community before the scent was available for purchase. Its "Art of the Trench" site, which invited people to submit images of themselves wearing a Burberry signature trench, took a slightly different approach, but still sought to make fans and customers feel valued and appreciated. Eventually, Burberry would share the images on its page, and encourage fans to comment on or like the images.

As with its Facebook page, Burberry uses Twitter to promote some of its popular promotional initiatives, such as the Acoustic campaign. The brand has approximately 1.9 million followers on Twitter and updates its page regularly, displaying an awareness of the importance of multimedia by including either a video or an image with nearly every tweet, Moth points out.

Notably missing, however, are links back to its e-commerce site, Moth adds. Because the brand is more interested in building a lasting relationship than promoting an urgent sale, "Burberry uses Twitter to promote and build its brand image, leaving it up to users to find their way to the online store," he says. While there's no way for Burberry to compete with brands that provide hefty discounts and deeply slashed prices, it remains on top by focusing on gaining a lifelong customer, rather than a one-time buyer. "Its approach is customer-centric, not product-centric. It's not about selling one coat. It's about gaining a customer [who] will come back for every coat," Ramey says.

Though the brand has two Twitter accounts—a primary one for marketing messages and a secondary one for responding to customer service inquiries—the team behind Burberry's main account makes an effort to connect directly with fans. "Last June, the social team sent personalized messages to all users who congratulated the brand on reaching one million followers," Moth says.

Burberry also has a heavy presence on Pinterest, where it boasts over 47,000 followers, as well as on Google+.

"While many brands put very limited effort into G+, Burberry keeps its page regularly updated with videos, photos, and other eye-catching content," Moth says. His one suggestion for the brand, however, is to make use of the Hangout. "Burberry doesn't appear to have used Hangouts at all, which is missing a trick," as they have signed up some famous musicians and also work with well-known designers. A Hangout would be a good way of rewarding fans and followers by giving them access to these celebrities," he says.

By embracing social media, Burberry provides customers with not only a shopping experience, but a cultural one. "When it comes to luxury retail, it used to be all about rarity. It used to be about buying something that no one else had. But now, it's increasingly about a unique culture," Milton Pedraza, CEO of the Luxury Institute, says. "Customers want companies that have a culture that they can share. It's a major evolution of mindset, and Burberry is embracing that. It's not really about the trench coat. It's about the culture that it brings to the customer."

Bargain Hunters

The discount retail industry has embraced social media, too, but to a very different end, and with mixed results. Discount retail giant Walmart, for one, currently has more than 26 million fans on Facebook, and interacts with them regularly. Moth praises Walmart's posts for their variety—updates range from posts of clearance sales promotions to pictures of cute dogs playing with Walmart's plastic bags. Consistently popular, most posts get thousands, and sometimes tens of thousands, of likes.

Despite its social media success, one of Walmart's initiatives notably failed, and experts agree: The results weren't surprising. In October 2011, Walmart partnered with Facebook to create 3,500 pages for its local stores across the United States in order to build brand loyalty with "enhanced local interaction at an unprecedented scale," according to a company statement. But as of last September, "the results were far from encouraging," Moth says.

Research by Recommend.ly showed that the local pages added just two million fans in 10 months, and most of the local pages had somewhere between 101 and 1,000 fans, in spite of regular updates and posts.

"Finding the right way to use social media has been a challenge for discount retailers for several reasons. For one, some of their customers don't necessarily use the Internet or, if they do, they don't rely on it as much as other shoppers. Furthermore, some products aren't really amenable to online sales, and just aren't worth the shipping charges," Marc Levinson, author of The Great A&P and the Struggle for Small Business in America, says. "Discount shoppers aren't interested in retailers that want to build brand loyalty. They're interested in retailers that want to give them a good deal, and fast, because they often don't have the funds to be long-term customers. They move from store to store, looking for the best deal," he says.

A good way to address the issue, Levinson proposes, is to integrate the in-store and online experience and marry the two to provide exemplary customer service, comparable to that of luxury brands.

On Twitter, Walmart embodies this approach, and uses the social network to respond to questions and concerns raised by customers. While it does send out marketing tweets, a large portion of its feed is devoted to answering tweets from users and creating unique hashtags to help enhance the shopping experience for its customers both online and in stores. The store uses the hashtag #WalmartElves, for example, to help customers who are looking for gift inspiration, Moth notes.

"Clearly Walmart sees the value of using Twitter to engage with its customers rather than just using it to churn out marketing messages. It has managed to [attract] 307,000 followers, which is impressive but still some way behind rival retailer Target, which has more than half a million," he adds.

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