Defining Success in Australian Retail using Social Media
1. 1 #SocialRetailSDL Proprietary and Confidential
Defining Success in
Australian Retail using
Social Media
Dave Goodfellow
Originally presented at:
Inside Retail Academy Conference (Feb 2016)
6. 6 #SocialRetail
Source: Facebook Ads https://www.facebook.com/business/ (Feb, 2016)
Population
24,000,000
14,000,000
Local Active Users
7. 7 #SocialRetail
Source: Kamber: http://kamber.com.au/australian-online-video-statistics/
60% of Aussies over 14
are actively using YouTube
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Social media is the number
one mobile internet usage
type amongst Australians
Source: Australian mobile Device Ownership and Home Usage Report (Deepend, Nov 2014)
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Evaluation
The systematic review and
comparison of options
Awareness
When the potential customer develops
awareness of a product through exposure
to informal and formal marketing .
Connection
This is the stage when they connect
their need/desire with specific options
available to them
Shopping
The experience in-store or
online, aided or unaided
Initial Experience
The initial experience that
shapes long-term
commitment to the product
Extended Experience
Product performance over the longer
term compared to the promise
Support
Service or support experience offered
Commitment
The long-term and repeat
customer experience
including upgrade path
The Purchase Journey
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Brand Awareness
Getting mailers, seeing brand commercials
or news, hearing about a brand from
others, seeing a promotion online, etc.
Brand Connection
Realizing how a brand is relevant to
them, how they can benefit from
products, services, deals and how they
Evaluation
Comparing options offered by
different brands, evaluating and
deep diving into each option
Trust
Attraction to products or deals
brands are offering and other
values the brands promise
Experience
Initial or Extended
experiences with
the brand
Affinity
Feeling satisfied
with a brand or product
Influence
Recommending specific brand to
others when prompted, sharing positive
experiences and benefits that differentiate
it from others
Evangelism
Totally committed to a long term relationship and
actively promoting the brand, trying to bust myths,
siding with a brand through its “ups and downs”
The Brand Advocacy Journey
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What they’re saying:
○ Top 3 most common themes
of conversation are:
1. Pricing and discounts (42.3%)
2. Customer service (17.2%)
3. Product availability (4.8%)
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Analysis - Shopping
○ High experience scores were driven by
conversation around around “value for
money” as well as conversations
triggered by content marketing
campaigns for #yayeveryday.
○ Versatility and relatability of the stories
connected to the #yayeveryday campaign
enabled target to retain consumer
attention and drive shopping
conversation over the highly competitive
and saturated holiday period
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Analysis - Loyalty
○ In addition to expected positive sales results
indicated by the scoring for the shopping stage of
the journey, similarly high performance in the
Commitment Journey stage indicates a strong
likelihood of repeat purchase and customer loyalty
○ Commitment is seen to be directly connected to
positive shopping and support experiences, with
many customers proactively displaying their
commitment and complimenting the brand on it’s
products, campaigns and/or customer service.
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“Those resourceful Germans have introduced into Australia
a shopping chain that at any one time combines the
offerings of all my preferred playgrounds [Liquor, DIY
hardware, whitegoods, nursery products and edibles]”.
– Woogsworld
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“With due pomp and ceremony [our family] launched and
christened the vessel HMAS Aldi. It took pride of place in
the underground car park much to the bemusement of
our fellow inhabitants. Life jackets were purchased;
paddles were assembled; tide charts perused, and all
was in readiness for HMAS Aldi’s maiden voyage.
Now some people are just not meant to be let loose on
the water. I am in that category.”
-Woogsworld
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The drivers of success on social today
Sales Loyalty Advocacy
○ Value for money
○ Variety
○ Product
availability
o +/ve pre & post
purchase exp
o Strong
Connection
o Strong
Shopping
o Strong
support
o Lifestyle
relevance
o High connection
and affinity
o Unique
experience
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○ There is a huge amount of
opportunity for retailers to engage
customers across the journey
○ The importance of social media in
retail is only growing, so take hold
of the opportunity to engage across
your customer’s journeys
○ Focus on getting the basics right
first, because it’s what consumers
are asking for
○ Ask your social media person or
team about your customer’s journey
Wrapping up
Editor's Notes
So to talk about success, I’m going to cover 4 topics
First, let’s put SOCIAL IN CONTEXT. Social media is an in inherently personal thing, and because of that the way that we each understand it is necessarily different. So what I want to do is look at it from as objective of a point of view as possible.
When it comes to the number of people who use social media, facebook is currently our best benchmark.
Facebook currently has more than 1bn daily active users, many of which who use the platform several times. And it’s worth noting here that “Active user” means someone who is logged into their Facebook account and using some aspect of the facebook ecosystem.
If we expand that active period out to one month, instead of a single day, that number jumps by more than 50% to 1.55bn. So that’s a lot of people using social media.
And, it’s worth noting that Mark Zuckerberg wants that number to be 5 bn by 2020 and is really chasing that figure down, doing everything from VR to building planes to provide wifi to non-internet connected areas around the world.
This next stat is my favourite. And that is right now people are watching 60% more YouTube now than they were this time last year. And this is indicative of the wider increase in consumption that is seen across most social and digital platforms.
So not only are active users in the billions, but the amount they are using is increasing immensely.
Production is also going up rapidly, and to get the pulse on that we can look to wordpress. Over 660m blogs were posted on wordpress in 2015, and that’s only one of the major blogging platforms. We’re not talking about tumblr, blogger, squarespace or any of the others.
So globally we can see that from all perspectives social media is massive, but also growing rapidly.
Now we do want to talk about Australia specifically.
Almost, two thirds of Australians use Facebook and are actively using social media. We’re a very socially forward population and many higly technically literate. So that’s where we are in terms of size.
As far as consumption goes, the local trend mirrors the global ones we just saw. With 60% of Aussies actively using YouTube.
And, time and again, when Aussies are asked what they do with their Internet usage, they tell us that Social media outstrips everything – including emails and making calls.
What I’ve just shown you should provide a handle on what the social media landscape is like today. There is lots else going on, new platforms, media trpes, and ways of utilizing all of it. But from this vantage point we can really start putting things in context.
While people are consuming, producing, liking, commenting and generally doing everything that social media makes possible at an increasing rate, I want to put the spotlight on the retail industry today, and as anyone in the business will tell you…
Retailers don’t measure success in likes comments and shares. There are 3 PRIMARY MEASURES OF SUCCESS
FIRST MEASURE OF SUCCESS
Success = sales.
And not just Sales, but Profitable sales
SECOND MEASURE OF SUCCESS
Success = loyalty.
Because the lifetime value of a customer is far more valuable than a single transaction. And traditionally we measure this though membership percentage of sales and subscriber base information.
THIRD MEASURE OF SUCCESS
And finally, Advocacy. Advocacy is the third way we define success.
And traditionally, we talk about all three of these metrics in quantitative terms. But getting a 3 on your NPS dashboard, or an increase in member sales doesn’t really tell you much. Even if you monitor how that number changes over time, these figures don’t effectively describe what’s going on or why
And this is where Social media comes into its own as a dataset – because we can wrap so much more context around the metrics for success.
The reason for this is every metrics we’ve mentioned is derived from a different phase of the customer journey and “Every social media post is a moment captured in time across that journey”. So if we use that data, we can start to answer really smart questions. Questions like:
Why are my sales growing?
Why are my member sales shrinking?
Why are people advocating for or against my product or brand?
And on social media the answers all come directly from the customer.
So what are we talking about, when we say “customer journey”.
Well, there are lots of interpretations floating around the marketing universe and many touchpoints along the journey that consumers can choose. But when you distil all these down to the core behaviours and how people interact with brands and companies you get two overarching journeys that describe the vast amount of all interactions. They are… (refer to slide)
The purchase journey has 8 stages and is very transactional and value driven. This is how it works.
Similarly, the Advocacy journey has 8 stages. And the first 3 are the same, because just like making a purchase, if you are to become an advocate for a brand then you must first become aware of the brane, connect with the brand and evaluate it against other potential alternatives.
So if we analyze these two journeys, we can better define and understand success…
…And that’s what we’ve done across the Australian Retail Insutry. To tell you more about exactly what that means, I’m thrilled to introduce something we’re calling the 2016 Social in Retail Study. Let me show you how it works.
First we collected all the conversations that happened across social media for 10 of the most talked about retail brands in Australia during the final quarter of 2015 – that includes blogs, news media, social networks, forums – the lot.
From there - Using our conversation analysis technology as well as human oversight - we identified all conversations that were relevant to the path to purchase and brand advocacy journey. And we got rid of all the ones that weren’t relevant.
And we were left with a sample size of almost 100,000 conversations to work with.
So what do we these conversations tell us?
Firstly.
Secondly.
i.e. creating an advocate is much rarer, than converting a sale by a factor of more than double
Now let’s take a look at how that journey plays out
Social conversations are a byproduct of events that motivate people to post and to seek information. Which points back to consumption and production that we were discussing earlier. And I think most people would expect that social conversations about retailers will fall into two main categories;
Those which happen prior to the transaction - Such as people motivated to find answers to questions about where to buy, which product and why?
And then those which take place-post conversion - Such as those wehre people are motivated to the experience they have with a product, or the extended experience with a brand.
That’s seems logical. But, as often happens when you do the research, what we find is completely different.
Why this matters: it shows where people are motivated to talk, and where the retailer has captured their attention.
This doesn’t just reflect social media, this happens when they see something great in the real world whether that’s instore, outdoors or on a device of their own (can we get conversations to support this?
The reason for this could be one of three things. Either:
1) People aren’t thinking about retailers until the later stages of the journey
2) People are incredibly loyal, and don’t consider different retailers during the buying journey
OR 3) Buying is just a result of browsing, and awareness connection and evaluation are irrelevant
If we apply ackham’s Razer and look at the likely option with the least exceptions or resistance, we can conclude that the first option is the most likely and Australian’s aren’t thinking or talking about retailers until the point of sale, and then again when they need assistance in the later stages of the journey (namely support, and commitment moving towards their next purchase.)
This isn’t necessarily a bad thing though. The conversations that are important to defining success in retail, sit various stages of the customer journey, so we need to make sure we’re looking at the right ones – and they’re exactly where people are talking most.
Why this matters: it shows where people are motivated to talk, and where the retailer has captured their attention. What this suggests this suggests is that you really don’t have it until half way through the journey.
What moves people along the journey is the quality of experience, so we also need to understand that to understand success.
It’s all very well to have high volumes of conversation, but if it’s all motivated by bad experiences it can work against you. And what we see is that the stages of the journey that are most directly related to retail success, perform consistently well, with an average experience score around the 60 mark.
This suggests, while there still may be some work to be done, the majority of experiences are currently positive.
However, while early stages have an especially high scores if you remember that there was a fairly low volume of conversation this suggests there may be missed opportunities fro brands. Namely that if you aren’t engaging earlier, that means that loyalty is dependent on only the shopping experience
It may be tempting to think that because you don’t control these stages of the journey that you cant influence this, but that’s wrong. You control the shopping experience by having a store. You control the initial experience because you’re able to provide products and guidance. You are able to interact with the customers after the sale etc… same goes for awareness, connection…
So what are people actually talking about in these conversations?
If we contrast these 3 discussion points, and think about the motivations behind them it seems a bit clearer that retailers enter the customer’s mind later
The top 4 categories account for almost 2/3 of all conversations when it comes to the buying or advocacy journeys.
This suggests that, before anything else, customers want what they always have. To do a good job of the basics – pricing, customer service and availability.
So rather than talking about industry level statistics, I want to switch gears now and show you a few more detailed examples of the customer journey across the Australian retail sector.
And I thought a nice way to do that is to highlight some of the brands that are doing the best in particular aspects of the customer journey – specifically those that relate to our success metrics around Sales, loyalty and advocacy.
So, the medal for the best experience across Sales metrics is… Target.
Lets have a look at the data specific to Target here.
This graph represents the percentage of social conversations about Target that exist across each of the 8 stages of the Customer Purchase Journey. These conversations are ONLY the social conversations relate to the Customer Purchasing Journey or buying something, and does not include any social conversations that are not relevant to this journey.
What we see is that if you look at the difference between the volumes target has is the primary stages related to sales, they’re actually marginally less than the industry average. So to look at why they excelled ahead of the other brands, we need to also take a lok at the quality of experience as well.
The total volume of conversations represented here exceeds 10,000 and are from Australian sources only.
Average conversation % is based on congruent analysis of other major Australian Department stores
What we see when we look at the quality of experience that people that target has is that their scores, outstrip the industry average in several stages, but in respect to sales this is most evident in the shopping stage of the journey.
A quick reminder of how these scores work too - Scores are based on advanced conversation and linguistics analysis, with grading from 0 – 100 based on the sentiment and context of conversation. The quality of experience and purchase intent that the experience score represents is not related to conversation volume – specifically that outlined by the previous slide.
Evaluation has a lot to do with price matching, but also with the image that they portray in their content as being for any shape, value for money and other key messages.
And the reason why Target has such a positive score in the Shopping stage comes down to 2 main things (refer to slide points)
Star wars https://www.instagram.com/p/9QOIzeI8WE/
Mugs https://www.instagram.com/p/-zg8vMMuFm/
Swimwear: https://twitter.com/targetaus/statuses/671891024717873153
Lingerie https://www.facebook.com/permalink.php?story_fbid=1227155197310115&id=196094017082910#1227757217249913
http://www.essentialbaby.com.au/forums/index.php?/topic/1163910-shopping-at-target/page__st__25#entry17206407;postid=20702a2a68496a68
Target also received a little boost from the launch of a new 5SOS album in October talking about their in store shopping experience. And any social media manager will tell you that you never see the stats for user generated content like this, but very uniquely this user share the impressions and actions from the tweet, showing us how powerful UGC can be within the customer journey.
Usually we don’t get an idea of how much of an im
https://twitter.com/cthkid96/status/658025189981089792
pact UGC
Second, let’s take a look at loyalty. And the best brand for loyalty metrics of success across the customer Journey during the holiday period of 2015 is… Target. Again.
And I desperately wanted to have different brands for each here, but you just cant argue with the data.
If we look at the volume of conversation acros each stage, again we see that target falls short of the industry average. So again we need to look at the quality of experience to better understand the context around their loyalty conversations.
And we see that when it comes to loyalty, and commitment to the product/brand, Target is almost 20 points ahead of the industry average. And if you were to think about this as comparable to NPS, that’s a huge leg up on the competition.
These are a few more examples of the broader conversations related to target’s commitment stage, and it’s really worth highlighting that the quality of customer service in many cases is what’s motivating people to openly discus their loyalty and commitment to the products/brand.
Again, refer to the points on the slide.
Target app: https://twitter.com/Niquey_R/status/655862879040606209
Beryl https://www.facebook.com/permalink.php?story_fbid=1235938476431787&id=196094017082910
Alicia https://www.facebook.com/permalink.php?story_fbid=1233957739963194&id=196094017082910
Katrina https://twitter.com/katrinalarsen/statuses/654447590780481536
Katharine: https://twitter.com/greyjeonghan/statuses/680549381888606209
Terri https://twitter.com/terri_beau/statuses/678472199095750656
Let’s switch back to talking about the customer journey from an industry level for a moment.
I want to talk about advocacy next, and to do that we need to look at the advocacy journey rather than the purchase journey – which as we saw earlier is much more emotionally driven than transactional.
When it comes to looking at the brand advocacy journey, it’s almost the inverse of the buying journey. But you have to remember, the stages in the brand advocacy journey are different to that of the purchase journey. No longer are we talking about shopping and deployment, we’re talking about trust, experience, affinity and more emotion.
This graph shows the % volume for each stage of the journey across the industry. Your eye might immediately be drawn to the low amount of trust conversations, but that isn’t necessarily a bad thing. What we find is that when you have volume in the trust stage it’s usually because there’s an issue. If people trust you, it’s a behaviour that’s usually internalized rather than discussed in detail. So that’s ok.
What else we see though, is that the two most emotional stages of the journey are where people are most vocal. Connection; the moment when someone realizes why a brand is relevant to them. And Affinity; the feeling (positive or negative) that someone has after directly engaging with a brand – in many cases by making a purchase.
The stages that best articulate success in the context of advocacy though – Influence and evangelism – have a fairly nominal value. And this seems to be because to get people to these stages of the journey, and to motivate them to talk about their experience online A LOT HAS TO HAPPEN.
What we see though is that the people who do make it to the influence and evangelism stages of the journey are talking about very positively about their experience – with both stages scoring ~66 / 100 for the quality of experience people are describing.
The continuity between the scores for Affinity > Influence > Evangelism, also suggests that there is likely a correlation between the people who have a positive affinity with the brand after engaging it and those who move on to become advocates at the influence and evangelism stages.
And when we look at the brand who did it best over the Holiday period for 2015, it wasn’t target for a change. It was Aldi.
The difference in Experience scores across the advocacy journey between Aldy and the rest of the industry is fairly narrow (compared to what we saw with Target and Loyalty for example), but if you remember from my grab stats earlier the total number of conversations that relate to the brand advocacy journey is only around 20% of all conversations so a few points difference can be very valuable.
I could show you lots of posts again, but really there was one from a blog called “Woogsworld” that really summed up all the rest.
It’s a daughter who is interviewing her dad about his self professed “Aldi addiction” trying to get to the bottom of why he’s so in love with the brand, and with shopping there.
He calls it his “retail playground” and he’s not the only one that thinks that way.
http://www.woogsworld.com/2015/12/aldiaddiction.html
A large part of the advocacy conversation around Aldi is dedicated to talking about the uniqueness of the items they stock, as well as the wide (sometimes ridiculous) range they have.
This novelty factor resonates with people, and it motivates them to talk about it.
Further still, the unique lines and combinations of products that Aldi sell fit into people lifestyles in very unique ways, and this leads to prolonged conversation about the experience. Here’s just an excerpt from the Woogsworld article I showed before, talking about the weekend trip that the father had when trying to win a few “grandad points” with his grandson after buying an inflatable rowboat. It’s definitely worth the read.
http://www.woogsworld.com/2015/12/aldiaddiction.html
So that’s what advocacy conversation look like, and what was the key driver for Aldi as the top brand in late 2015.
So to sum up what we’ve seen driving success in retail across the customer journey, this is what’s resonating right now.
Moral of the story is (Refer to slide points)
If you want to know more about your brand or about the customer journey, come and chat to me afterwards
