A BRICK MEETS CLICK ORIGINAL PAPERThe Pull Side of Social MediaHow Starbucks leverages online consumer dialogto continuously improve the brand experienceBy David Bishop, Managing Partner, Balvor LLCIt’s true that digital technology has shifted market power to shoppers. Todayconsumers can leverage various web-based applications to maximize their abilityto get the best perceived value. However, it’s also true that technology offersretailers the opportunity to engage shoppers in new and more effective ways. Many retailers leverage digital technology to broaden their reach, buildbrand awareness, and push out incentives via special deals. However, marketing- centric retailers are also leveraging it to build Brick Meets Click explicitly stronger connections with consumers – invites constructive builds and commentary on its original connections that support company efforts to papers. Join the conversation at www.brickmeetsclick.com. continuously improve the brand experience throughout the path to purchase. Via proprietary platforms or a large social media sites like Facebook,companies are pulling consumers into the business process by encouragingcomments, stimulating discussion, listening to what others are saying, determiningwhat actions to take, following up on consumer questions or issues, and sharingthe changes they are making in response.
a A BRICK MEETS CLICK ORIGINAL PAPER 2 The “My Starbucks Idea” web site is a great example. It enables consumersto “Share. Vote. Discuss. See.” ideas with the company and others in theStarbucks user community.Value of DialogThe site’s functionality is impressive. It provides an easy and effective method forconsumers and the company to interact. Less than thirty months after its launch,Starbucks claimed to have received their 100,000th idea. This is the equivalent ofreceiving over 3,000 ideas per month. It’s important to recognize – as Starbucksdoes – that many of the ideas shared may not have been on the company’s “radar”or ever identified without this type of consumer input.Form Follows FunctionAnyone is able to post an idea or build on other conversations after setting up anaccount on the site, which is relatively quick and easy. Starbucks enhances theprocess by offering a drop-down box that allows consumers to select where eachidea is classified – atmosphere and locations, food, new technology, etc. Thecomment is posted instantly for others to see, vote on, and comment.The Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011
a A BRICK MEETS CLICK ORIGINAL PAPER 3 Collective WisdomGiven the sheer volume of input that the site generates, Starbucks takes advantageof technology even further by using a form of crowdsourcing.1 This process helpsthem understand and begin to evaluate the merits of each idea by allowing othersto: • Indicate agreement with the comment by either promoting or demoting an idea (their version of “liking” or “disliking”). Each vote helps to determine how interested others are in the idea and what level of agreement there is among the community. • Share comments related to the idea, essentially keeping the discussion going and offering additional insights. And, in some cases, comments from others help reveal what the community already knows or believes about various ideas, acting in a way as a brand ambassador for the company. In this way, Starbucks enlists the broader consumer market to help generateideas and analyze their potential appeal. It lightens the company’s workloadslightly by acting as an initial filter for new ideas – and it empowers consumers byallowing them to share their personal opinions. These mutual benefits help tobuild a stronger connection between consumer and the brand.Understanding the ImpactOne approach to examining the value of engaging consumers using digitaltechnology is to examine how it helps improve business practices, productofferings, and/or the overall experience with the brand. 1 Crowdsourcing is a problem-solving process. Ideas or issues are broadcast to a group of people using an open forum for discussion. People —also known as the crowd—submit feedback and crowd sorts through the ideas/comment, helping to identify the best ones. The Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011
a A BRICK MEETS CLICK ORIGINAL PAPER 4 As of June 2011, Starbucks indicated that they’ve launched 150 of the ideasso far, such as bringing back happy hour, offering a 24-ounce reusable cold cup,and creating a mobile app for the Android smart phone.Exposing the BrandWhat’s really neat about the site – or potentially unnerving – is that anyone canlearn a lot about what consumers would like Starbucks to do differently. The good,the bad, and the ugly, it’s all out there – and companies need to be willing toembrace and encourage this level of transparency. For instance, according to my search, the top, all-time idea relates tooffering a coffee-club program, e.g., “buy 10 get 1 free.” And while Starbucksmay not deploy a program exactly like the suggested idea, it is vitally important tofollow up in general to ensure consumers feel as though they’ve been heard andthat the company appreciates their input and comments.Look before You LeapSomething like the Starbucks site isn’t for the faint of heart. It takes manyresources and an on-going commitment to execute effectively. For instance,Starbucks indicates that they involve around 40 “Idea Partners” to support theThe Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011
a A BRICK MEETS CLICK ORIGINAL PAPER 5 process. Each is a specialist in different parts of the organization, e.g.,sustainability, operations, etc. Efforts don’t have to be this elaborate. It’s important to point out that otherretailers are engaging consumers in similar ways, using different platforms likeFacebook. The digital technology available today helps level the playing field to adegree, so companies of all sizes can develop programs that support their uniqueneeds and business strategies.Embracing the OpportunityIt’s worth noting that consumers are offering ideas and feedback without thepromise of a coupon or free drink; the desire to be heard and appreciated has valuein and of itself – apart from other incentives. It’s becoming increasingly clearthat a well-executed program thatengages consumers in a two-waydialog can do more to help build abusiness over time than any limited-time promotional deal ever could. Thissuggests that companies would benefitby incorporating pull strategies thathelp to capture online consumerinsight in order to continuously Starbucks leverages Twitter to broadcast messages to improve the overall brand experience. consumers as a way to build more engagement on their web site. David Bishop is managing partner at Balvor LLC, a sales and marketing firm located inBarrington, IL. He can be reached at firstname.lastname@example.org.The Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011
a A BRICK MEETS CLICK ORIGINAL PAPER 6 Thinking Through the ImplicationsJohn Schaninger, Vice President of Marketing at Quick Chek, a 120-storeconvenience store operator headquartered in Whitehouse Station, NJ, helps to putthe article’s implications into context from his perspective.Q. What are the key lessons learned from this articles?A. The article shows the potential value created when companies interact with consumers. However, it also highlights the need for resources so that companies can handle the flow of information that is generated from a process like this.Q. What should companies consider as they evaluate plans to do something similar?A. I’d suggest that before embarking on this type of initiative, companies need to have a good strategic plan in place as to what they want to learn, who they are targeting, how they will respond, and how it fits into their overall marketing and research plans. This will ensure that the activities provide a good fit and are supporting the company’s overall business objectives and strategies.Q. What could companies do if they can’t commit the level of resources that Starbucks does with its site?A. Companies can start by asking a few questions on their Facebook page or designing online surveys that customer can take. Doing so can help them gain consumer insights more cost-effectively before investing in more complex programs. The key is that companies can leverage these insights to make more effective decisions about the business that help improve the consumers’ experience with the brand. For instance, prior to launching our latest sub campaign, Quick Chek shared the proposed billboards with consumer focus groups. We then selected the top two and posted them on Facebook for voting and comment. Our fans overwhelmingly responded in favor of one board over another. Interestingly, the billboard we had planned on using, while the most popular among focus groups, received very negative comments during the online polling process. Ultimately,The Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011
a A BRICK MEETS CLICK ORIGINAL PAPER 7 based on the online consumer insights, we made a decision to go with the fan- supported billboard. The point is that these types of applications can provide you with an incredibly rich source of customer insights that are difficult to gain from other, more traditional research methods. At the same time, the online tools simply strengthen a company’s research capabilities.Q. Given that this technology can change what and how companies engage in consumer research, what do companies need to be aware of as they incorporate this into their internal processes going forward?A. It’s important to remember that many successful companies have been doing this for years. Before the internet, companies captured consumer feedback via store team comments, comment cards, letters, phone calls, and in some instances, customer panels. Today, the internet, and Facebook in particular, have created these types of giant, “uber-panels,” with the expectation of two- way feedback and action.The Pull Side of Social MediaHow Starbucks leverages online consumer dialog to continuously improve the brand experiencePublished August 2011