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Retail Technology, Retail technology News

Social media influencing consumer preferences

Friday March 19 2010

IDC Retail Insights reports on the main opportunities being created by social networks for retailing

IDC Retail Insights reports on the main opportunities being created by social networks for retailing

 

IDC Retail Insights recently released a new report, which gives an overview of the main opportunities being created by social networks for retailing.

 

The study also analyses the various social phenomena developing on the web 2.0, including social shopping networks, widgets, blogs, media sharing Web sites, microblogs, and social bookmarking and how these can be used by retailers to gain a competitive advantage.

 

Brand influence growing socially

 

"It is increasingly on social media that retail brand awareness is established and brand image is built," said Ivano Ortis, IDC Retail Insights research director.

 

"Social networks, blogs, price comparison websites and the likes can all be used by retailers of all kinds and sizes to attract and influence customers, to study demand patterns, to improve brand reputation, and, finally, to provide customer support.

 

“Looking ahead, IDC Retail Insights sees an open social network built on a personalised widget portal, which will be available to each consumer individually, independent of each retailer – and yet supported by all of them – accessible from everywhere via a wide array of technologies," he added.

 

The report also said social media – with the top 10 social networks now having surpassed 1.3 billion members – are also influencing consumer preferences by shaping their attitudes and behaviour.

 

Opportunity to attract and influence

 

Therefore, web 2.0 technologies will play an extremely important role across all retail segments. Social networks, blogs, and price comparison websites can all be used to attract and influence customers, to study demand patterns, to improve brand image, and to support customers after their purchases.

 

IDC Retail Insights' Business Strategy: Social Commerce Opportunities, Strategies, and Risks for Retailers Globally report also highlights that the innovative nature of social media can turn multiple account profiles into an opportunity for retailers to capitalise on same-shopper sales growth prospects.

 

Retailers' presence across social media networks also needs to be well balanced, allowing consumers to feel in control of their own personal spheres. A friendly, interactive presence on a social network can greatly improve brand image and help the company gather extremely useful, unstructured data about demand trends.

 

Merging physical and virtual worlds

 

And the use of mobile social networks has grown significantly, in a process that will most likely bridge the gap between online and physical shopping.

 

According to IDC Retail Insights, retailers should establish a presence on social networks not only with the direct objective of attracting consumers to their websites or stores, but most importantly to gather useful information, in a non-intrusive way, on their current and potential customers. In other words, retailers should learn to listen at customers who are engaged in social communities.

 

The report also examines some examples of retailers that have entered the treacherous realm of social networking: some were successful while others were not. Both cases provide useful lessons.