Express Goes Social, But Not for the ROI
Everybody in the retailing industry presumably knows by now that social media is a big deal, and so does the CMO of Express, Lisa Gavales, but she doesn’t expect it to result in ROI.
Express is a specialty apparel and accessories retailer that targets 20-to-30 year olds, with over 600 stores in North America. Speaking at the eTail East Conference in Boston last week, Ms. Gavales said that their customers are social, mobile and informed, but they are also price sensitive and suffer from data overload. In a sense, she said, shopping used to be "easier" — or at least more linear.
Ms. Gavales believes one of the keys is leading with your brand and not trying to measure your social success using ROI. She warns that a multi-channel marketing approach can lead to inconsistency that can tarnish your brand. She also stresses engaging in "true" communication — two-way communication — with customers. Responding to individual inquiries on Facebook and Twitter, for example, essentially lays the groundwork for offering customers products and specials (i.e., one-way communication). Express representatives often respond to customer posts on Facebook within minutes.
Social media helps retailers communicate with customers daily or even more frequently, rather than using monthly mailers or 3x per week emails. And yet, ROI metrics for social interaction remain elusive. Ms. Gavales says trying to measure the ROI on social media is like trying to measure the ROI on store air conditioning — you can’t, but it’s something you can’t do without.
Regarding mobile, Express is seeing conversion currently at only one-third of what they get from their website. But Ms. Gavales says that isn’t the point. The customer has their mobile device with them all the time, and the adoption of the mobile wallet may completely change the way we think about transactions. Plus, mobile can help customers "assist themselves" when in-store help isn’t there or isn’t desired.
Retailers need to organize around their brand(s) and execute by channel, said Ms. Gavales. The more channels drive the org chart, the harder it is to be consistent across channels, she believes. That’s why Express has one marketing department and one creative department covering all channels. This strategy is designed to assure the customer will get clear messaging everywhere and consistent pricing across communication and buying channels.
Note: As of August 1, 2012, Express had 2.4 million "likes" on Facebook, which puts it on par with Guess?, more than double TJ Maxx, and about triple that of Ann Taylor. Express also had 46,000 followers on Twitter, which is double the following of The Body Shop and over 10x Chico’s.
Discussion Questions
Should retailers and brands view social media as a marketing tool, or as an opportunity to drive ROI? Does pricing and messaging need to stay consistent across all channels?
The question of whether social media is a marketing tool or an opportunity to drive ROI should not be “either, or?” but rather both. It is myopic to discount either given the importance for marketing to support both branding and driving sales.
As a marketing tool, social provides a great way to create a real-time dialogue, especially away from the “store” but at the same time, it should drive insights which should lead, at a minimum, to better decision support and customer relevance. Both of these factors can be measured from an ROI perspective.
As the tools available to test and measure campaigns, and social channels improve, so should the expectations for social ROI be raised. For reference, check out this interview published with Dunkin Donuts CMO John Costello, who directly discusses social ROI.
Social media is a marketing tool and part of a larger media mix. And while it may be more difficult to measure, it is important that social media have an ROI measurement, like other media.
Since there is a wide array of marketing vehicles available to retailers, it’s important that they share a common core story about the company and brand. Beyond that, each media should be played for its strength and does not need to carry a common message. Some, like social media, may be more sensitive to a value-added promotion. Television might be best used to convey the overall brand message and drive consumers to social media. It all depends on the overall objectives of the company.
Business has become obsessed with the pursuit of measurable ROI. It has become a management crutch to replace the need to make business judgements and take the responsibility for them.
Retailers and brands alike should most definitely organize themselves around their customer’s point-of-view and then design and activate the relevant and ‘correct’ brand experience across channels. I am certainly an advocate of measuring and managing for success, but getting too myopic will cause you to lose overall perspective.
Engaging with the shopper can only be genuine if you achieve a dialog and emotional bond. Simply ‘pushing’ or forcing your brand agenda to the shopper using new technology and available channels will not succeed. Taking the time to understand how your target shopper uses and embraces the various available channels is paramount. Only then can you design and activate a relevant and consistent multi-dimensional brand marketing communication strategy to make it easier for your customer to shop and purchase your goods and services.
Is advertising a marketing tool or an opportunity to drive ROI? The answer is the same. Why, oh, why do we try to hold new media to higher standards than we do the hundreds of billions that have been spent on traditional advertising? This thought process boggles my mind.
With regard to cross channel marketing…any retailer who doesn’t see the “channels” as only a delivery alternative is missing the basic logic of what the business is all about. It isn’t to sell products on the internet. It isn’t to sell products in the store. It is to sell products to the customer, wherever they are and however they want them. To have different messaging in different channels would be the same as having different messaging for every store in a chain.
Pricing is another matter though. In Manhattan, operating a retail store is more expensive than in the suburbs. As a result, chain pricing is regularly higher in Manhattan than in the suburb. Similarly, if certain channels provide operating efficiencies to a retailer, why not price that channel lower than those that are more expensive? If a channel is efficient enough, the item could be priced lower and the retailer could make more money than in the alternative channel.
With all due respect, from an outside perspective, it sounds like there’s some excuses for lack of a better strategy for user experience. I’d like to know the definitive ROI for billboards, TV, radio, magazines, etc. There are measures of those things, but much of it is inference. So should they be discounted from the company’s ROI assessments?
The fact that a business hasn’t mastered SM or mobile in a way that satisfies their financial measurements is an indicator that they need to create a long term strategy that they can execute to make those tools more effective. Additionally, the phrase “…mobile can help customers “assist themselves” when in-store help isn’t there…” points to a need to revisit what is an acceptable level of poor customer service.
What gets measured gets done. Based on Lisa Gavales’ comments, Express is measuring use and influence of a variety of different media. Every media form should have an ROI, as it connects with the consumer. If not, marketers are merely throwing their gut intuitions to the wind. With that formula, sometimes you win, and sometimes you lose.
Express’ focus on the digital media side plays well to their customer base — young, enthusiastic, aware and highly mobile. Based on the June BIGinsight Media Behaviors & Influence Study of 24,000+ Adults, the Express shopper — Male and Female — are enormously comfortable in the Digital space.
Compared to the General Population, Express Male and Female shoppers point to a wide variety of Media that influence their purchases of apparel/clothing. The Express shopper shows a significant affinity to digital.
Social and digital media are a marketing tool. And, they can and do drive ROI.
Social media is a marketing tool and your first line of defense for poor customer service. As long as you have active communication between reps and customers that is honest and respectful, you will build brand trust and loyalty.
Many businesses keep confusing the tools of communication with tools for marketing. Just because people use a common tool for communication, doesn’t mean that it has common value in marketing. Social media falls in this camp, since it truly doesn’t have substantial media drive, nor has it received any proven ability to create lasting TOMA (Top of Mind Awareness) that is so essential in developing a marketing campaign that commands a call to action of its audience. Time and again, social media fails when delivering measurable value in a marketing campaign. Until this can change, we should use social media as simply a communication “compliment” for a marketing campaign, not a contributor….