The project :: Deploy a social commerce tool that can help online fashion retailer Tobi forecast the results of social media promotions and boost revenue.
The business case :: Tobi’s founders needed to integrate social media into the company’s marketing and sales strategies. But its in-house efforts—posting promotion codes on its Facebook fan page, for example—were a flop, says CTO Anthony Wang. Redemption rates were low, and when a promotion did engage followers, there was no way to determine why it worked.
Wang researched whether Tobi could develop more robust social media analysis tools that would give it insight into the specific actions of its fans and customers, but he determined it would require too much time, money and attention. “It’s hard for a retailer to build a social commerce platform on its own,” Wang says.
Instead, Tobi subscribed to CalmSea’s predictive social commerce offering, which Wang says costs several thousand dollars a month but requires little upfront investment. The software collects traditional online marketing data, such as click-throughs, along with data published on the social media pages of people who access the promotions.
First steps :: In the first phase of the project, the marketing department launched contests, giveaways and sales on Facebook and Twitter using the CalmSea tool. During each promotion, the software collected data about potential customers’ likes, interests, posts and comments, creating a “social graph”that mapped potential buyers’ relationships. “It gives us some great insights, beyond just their purchase history,” Wang explains, noting that the tool shows what customers’ friends like and how influential they are.
In the second phase, Tobi integrated CalmSea with its transaction logs and Google Analytics tools. When a customer used a code from a social media promotion, the system pulled together that person’s social graph and purchase history. “Based on the combined data, we can gather insights about our customers and offer personalized promotions,” Wang says. Within three months, Tobi saw a fivefold growth in social-media-generated revenue.“People are referring before they buy, and social [media] really accelerates how fast those referrals can spread,” says Wang.
Next, Tobi will use CalmSea to manage and measure promotions on its website and Facebook to target customers based on their online behavior and create a cross-channel marketing strategy.
What to watch out for :: Social media promotions must be fun, Wang discovered. Merely offering discounts won’t promote the brand or boost sales; you have to create games that make shopping more enjoyable. Tobi has deployed shareable giveaways, through which fans receive additional entries every time they share a promotion with friends, and it offers exclusive private sales for its most loyal fans.
“We spent a lot of time thinking about how to correlate promotions with downstream actions, from impressions on Facebook or Twitter to referrals to site visits to purchases and revenue,” Wang says.
Although it’s safest—and quickest—to start small, Wang wishes he had integrated CalmSea with back-end systems from the start. “It wasn’t until we were running that we saw the value of the second phase,” he says.