Leveraging social media
In India's Rs 2,65,000-crore retail sector small businesses looking to drive volumes with the right consumer engagement programme in the shortest possible time window must turn to social media marketing. At least two recent surveys point in this direction.
The retail market in India has three distinct segments - the large format segment that includes national players (including e-tailers); the mom and pop kirana stores; and the independent retailers. The mid-segment of independent retailers is mushrooming across the country. These are single or multi-store retailers, usually in one city, who are picking up key aspects of technology. These stores are also toying with social media to engage customers.
The Retailers' Association of India (RAI) and GoFrugal Technologies conducted a survey recently to explore the current state of play among 31 independent retailers in Delhi. This is in addition to the interviews of 23 retailers carried out in the Chennai earlier. The survey included retailers across food, grocery (including kiraanas and single-store supermarkets), quick service restaurants, fine dining, designer furniture, apparel and accessories, footwear, jewellery and cosmetics and hotel chains.
There are three main differences between independent retailers in the two markets surveyed. First the retailers' focus on marketing and brand building is higher in Delhi than Chennai. Second, space costs and attrition are not as much of a concern for independent retailers in Delhi as they are in Chennai. Next, while e-commerce is seen as a channel opportunity by independent retailers in Delhi, it is seen as a threat by retailers in Chennai.
Independent retailers seem upbeat about the market, and as a consequence perceive overall competitive intensity as 'not being high'. That is not to say they do not see threats from competitors, but overall business confidence is still relatively positive (helped by the change in market sentiment since May 2014, when the government changed). Most of the participating retailers spoke about same store sales (SSS) growth being around 12-18 per cent even in the last two years. While growth has flattened and consumers have reduced discretionary spending, business outlook is still positive. Organised retailers are not seen as serious competition except when it comes to finding space in shopping malls.
In India, 97 per cent of organised marketers are using social media, says the 2014 Social Media Marketing Industry Report. With the objective of understanding how to grow and promote one's business on social media, 2,800 marketers participated in the survey. The largest group that took the survey works for small businesses of 2-10 employees, followed by the self-employed; 21 per cent of people who took the survey work for businesses with 100 or more employees.
About 92 per cent of marketers surveyed indicated that social media is important for their business, up from 86 per cent in 2013. Blogging is picking up fast with 68 per cent of the total respondents planning to make heavy investments in this area in future. Facebook, Twitter, LinkedIn, YouTube, blogging, Google+ and Pinterest were the top seven platforms used by marketers. Facebook and LinkedIn are the two most important social networks. When forced to only select one platform, 54 per cent of marketers selected Facebook, followed by LinkedIn at 17 per cent. That apart, original written content emerged as the most important thing for social media marketing. About 58 per cent of the marketers stated that original written content is the most important form of content, followed by original visual assets. Surprisingly only about one in three respondents (37 per cent) agreed they are able to measure their social activities. However, this was an improvement from 2013, where only 26 per cent indicated they could measure ROI. About 83 per cent of marketers agreed that they had integrated their social media and traditional marketing activities, slightly up from 79 per cent in 2013. It is interesting to note that nearly 19 per cent of marketers spend more than 20 hours each week on social media.
One of the key findings of the survey pertains to the impact of social media marketing on sales. More than half of the marketers who have been using social media for at least three years report it has helped them improve sales. B2C marketers (77 per cent) were much more likely to develop a loyal fan base through social media than B2B marketers (64 per cent).
Of those who have been using social media for at least one year, 69 per cent found it useful for building a loyal fan base. The time invested in social media also makes a difference.
Of those spending at least six hours a week, 78 per cent found benefit compared to 56 per cent of those spending five hours or fewer per week.
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Leveraging social media