From the Co-Founders of The Retail Owners Institute.Tips | Tactics | Insights on the Business of Retailing.
The ROI NEWS asked retailers this question about the effectiveness of Social Media: “Does it raise sales?!”
We invited retailers to take a short, quick, 6-question survey about their use of promotional tools in general, and, in particular, “Social Media”: Facebook, Twitter, Pinterest, Instagram, LinkedIn, Other.
We asked, and you answered!
You quickly confirmed that “social media” is in fact a hot topic among retailers!
And, you are willing to share your experience with it with others, and for that we say, Thank You!!
After reviewing the survey results, we have prepared some charts to summarize the findings.
Scroll down to see:
• Which social media platforms are favored by retailers?
• Which types of social media are effective (or not) at raising sales?
• Are any platforms likely to be used more in the near future?
• And more!
What is increasing? What the experts call "earned digital media:" social media, e-mail, and websites/blogs.
And which promotional tools have declined in usage by retailers?
Print advertising is the biggest loser.
But, pay-per-click ads (such as Google ads) and direct mail receive plenty of Do Not Use/Have Never Used votes.
Seems like many retailers have subscribed to the "Location. Location. Location" mantra, counting on foot traffic.
Q. #2: Now, about Social Media. If you are using it for your stores, which platforms do you use?
Facebook is by far the most popular platform among retailers, being used by 97% of all the survey respondents!
The use of Instagram has surged! And that seems to be at the expense of Pinterest, which has declined from 1 in 3 respondents in 2015 to 1 in 4 in 2017.
Once again, Facebook is the runaway "winner" in terms of longevity among users.
Instagram and Pinterest seem to be attracting the most new usage by retailers.
Q. #4: Key Question: Of the Social Media you use, how has it INFLUENCED SALES?
Again, Facebook is "the winner". 82% of the retailers who use Facebook report it "Seems worthwhile" or is "Very Positive!" That likely explains why 97% of the retailers who responded are using/continuing to use Facebook. Instagram is rated useful by nearly 3/4ths of the respondents.
Overall, there seems to be high satisfaction with the benefits of social media. The comments offered reflected the difficulty of attributing increased sales to any one promotional effort.
Moreover, a given platform's effectiveness at influencing sales will be a function of how each one is used.
If social media is being used, for instance, to build awareness or to stimulate word-of-mouth advertising, then its influence on sales is indirect at best.
Additionally, as these social media platforms have experienced tremendous growth, the opportunity to gain visibility and/or a competitive advantage has been diminished.
Q. #5: Have you used any of the ADVERTISING PROGRAMS that are available on these platforms?
Of the retailers who use these social media platforms, there is a high degree of participation in the paid advertising programs, especially on Facebook (68%) and Instagram (35%).
And among those who are not already active advertisers, more than 1 in 4 anticipate starting soon.
Q. #6: And finally, just a bit about your stores. How many do you have now?
Sure enough, the survey respondents are "representative" of the independent retailer community at large: about 1/3rd are multi-store operators.
What does it mean?
Granted, retail sales are affected by a host of influences. The effectiveness of social media, like all promotional tools, is not limited to whether or not it raises sales. But, survival in retail DOES require selling. And given all the other demands of owning and operating retail businesses, retailers must improve productivity – of your advertising, your inventory, your employees, your stores, etc – whenever and wherever you can.
Shouldn't it all be working hard? And effectively?
The National Retail Federation sponsored a survey in early May of retail small business owners across the country (those that meet the SBA definitions for employee size and revenue.) Contrary to the doom-and-gloom of the "Retail Armageddon" stories, this survey confirmed that retail owners are optimistic and looking to expand.
Few believe their business will be in worse shape in 12 months;
Nearly half expect revenues to increase;
Many have goals for expansion or implementation of new technologies.
You’ve heard about 3D printers, right? They are computer devices that use a blueprint (a “digital model”) of an object and produce (“print”) one or more copies of that object by painstakingly building up layer after layer of its form.
Essentially anything that is manufactured can be replicated, one by one, with a 3-D printer!
And, be ready. It is coming to a store near you very soon. Shouldn't it be your store?
As we often discuss, retailing is a very dynamic industry, constantly changing and evolving. To be successful, retailers must pass frequent flexibility tests. So we paid particular attention to this recent headline in the New York Times*: "The freshest ideas are in small grocery stores."
As we often explain, "Retail is a mirror of society." As such, we believe all retailers have an opportunity to lead by example. And most of us do a fine job.
Recently, however, there have been some extraordinary examples of retailers taking an extra chance but certainly setting some fine examples.
This looks promising!
"Consumer confidence hits 18-year high" is a welcome headline to retailers. In The ROI's view, consumer confidence is one of the most reliable indicators of retail sales trends.
And just as the Conference Board was reporting that their consumer confidence index was at the highest level since September 2000, the National Retail Federation reported that consumers anticipate their Holiday spending to be 4.1% higher than last year. This corresponds with the NRF's economic forecast of Holiday spending increases of 4.3%-4.8% over 2017.
We have a mental image of a wide-open plain with hundreds of prairie dogs, cautiously poking their heads above ground. Looking around, they slowly realize they can actually venture out into the world once again. And venture forth they do. One by one at first, then more and more. Enthusiastically. Energetically. Excitedly bounding about, encouraging others to share their sense of adventure and fun. And that’s what we imagine is next for independent retailers. Here’s why.
Pat Johnson and Dick Outcalt, The Co-Founders of The Retail Owners Institute®, have been called "The Zen masters of retail finance!" Since 1999, they have been assembling their proprietary content into a unique self-help website. The Retail Owners Institute is an unmatched resource that assists retailers worldwide with basic financial training, assistance and easy-to-use tools. Their engaging and empowering how-to resources about the financial levers in retailing are informative, fun(!), and retailer-friendly. Their promise: "Everyone will 'get it'!" Pat and Dick are recognized experts in strategic retailing. Working only as a team – Outcalt & Johnson: Retail Strategists, LLC – they have been consulting, publishing, and speaking professionally throughout North America since 1990. They focus exclusively on retail, or wherever retail is involved. They work with CEOs, CFOs, boards and owners of retail operations, as well as manufacturers or wholesalers expanding into retail. And they also are Retail Turnaround Experts.
Since 1999, empowering retailers and store owners to "Turn on your financial headlights!"