So­cial me­dia now more im­por­tant for re­tail­ers

CityPress - - Business - JUSTIN BROWN justin.brown@city­press.co.za

So­cial me­dia is be­com­ing in­creas­ingly in­flu­en­tial for re­tail­ers to tar­get their cus­tomers.

An­ton Hugo, PwC Africa re­tail and con­sumer leader, said that on­line me­dia and so­cial me­dia, as well as other in­flu­encers such as blog­gers, were be­com­ing more im­por­tant for the lo­cal re­tail sec­tor.

“Twit­ter and Face­book in­flu­ence pur­chases,” he said, quot­ing from a world­wide PwC re­tail sur­vey that sur­veyed more than 24 000 on­line shop­pers in 29 coun­tries, in­clud­ing over 1 000 re­spon­dents in South Africa.

“South African con­sumers are com­fort­able us­ing so­cial me­dia. They find new prod­ucts on so­cial me­dia,” Hugo said.

Liz Hil­lock, Woolworths’ head of on­line, said that a ma­jor per­cent­age of the com­pany’s on­line traf­fic orig­i­nated on so­cial me­dia.

“We have found that many cus­tomers dis­cover prod­ucts on so­cial me­dia, browse those items on­line and then pur­chase them in-store.”

A Shoprite spokesper­son said that so­cial me­dia was key to mar­ket­ing for the group.

“So­cial me­dia has be­come vi­tal for cus­tomer feed­back and sug­ges­tions, which the group takes se­ri­ously,” the spokesper­son said.

Said Hugo: “The South African con­sumer has a high level of brand loy­alty.”

Hugo said this was a par­tic­u­larly im­por­tant trend given that there were 23 mil­lion smart­phone users in South Africa. By 2020, the num­ber of lo­cal smart­phone users is ex­pected to climb to 35 mil­lion.

Re­filwe Boikanyo, a Mass­mart spokesper­son, said that last year, the group saw prof­itable on­line sales growth of over 100%.

How­ever, Shoprite has no on­line shop­ping pres­ence.

On­line re­tailer ama­zon.com was chang­ing the global re­tail sec­tor, Hugo said.

Ama­zon was now the world’s tenth-largest re­tailer, he said.

“Ama­zon has set many on­line stan­dards in re­tail through its cre­ativ­ity and seem­ingly never-end­ing streak of dis­rup­tive in­no­va­tions,” Hugo said.

Ama­zon has two kinds of im­pacts: shop­pers use Ama­zon as a re­search site for prices and prod­ucts and Ama­zon also can­ni­balises other re­tail­ers.

A key find­ing of the PwC sur­vey was that re­tail­ers should in­vest in an Ama­zon strat­egy and that they should in­vest in a mo­bile site and not a mo­bile app.

Hil­lock said that lo­cal on­line re­tail was a nascent mar­ket and was grow­ing quickly.

She said that Woolworths’ on­line foods busi­ness was grow­ing con­sis­tently and the com­pany was see­ing good on­line growth for its cloth­ing, home­ware, kids’ and baby cat­e­gories.

Rashaad For­tune, PwC as­so­ci­ated di­rec­tor on re­tail, said: “Shop­ping via smart­phone is con­tin­u­ing to surge in pop­u­lar­ity.”

Con­sumers are us­ing their smart­phones to re­search prod­ucts, com­pare prices, pay for pur­chases and check con­sumer re­views, he said.

“The fre­quency of mo­bile shop­ping ... is within strik­ing dis­tance of shop­ping via the per­sonal com­puter.”

Weekly, 11% of re­spon­dents are do­ing mo­bile shop­ping and 16% are us­ing a PC for on­line shop­ping, For­tune said.

Hil­lock said that over 50% of traf­fic to the woolworths.co.za web­site was from mo­bile de­vices.

“We’ve re­cently launched free Wi-Fi in over 85 stores and plan to roll it out in more stores in the next 12 months,” she said.

An­other trend that For­tune iden­ti­fied was that re­tail­ers could bet­ter tar­get their cus­tomers via the data they col­lect. “In­vest in big data in­sights, not just data col­lec­tion,” he said.

“One of the top is­sues for re­tail­ers to­day is par­lay­ing the enor­mous amount of cus­tomer data they gen­er­ate into ac­tion­able in­sights,” For­tune said.

About 35% of re­tail­ers are strug­gling to im­ple­ment a strat­egy to pro­vide a sin­gle view of the cus­tomer, For­tune said.

A Shoprite spokesper­son said that col­lect­ing cus­tomer data, as well as im­ple­ment­ing their feed­back and sug­ges­tions, was a key pri­or­ity for the com­pany.

Hil­lock said that Woolworths col­lected and an­a­lysed data and this helped the re­tail group bet­ter un­der­stand and meet cus­tomer needs and im­proved its abil­ity to de­liver more per­son­alised com­mu­ni­ca­tions to its cus­tomers.

For­tune said that when it came to luxury goods, “au­then­tic­ity” was im­por­tant.

An­other find­ing of the PwC re­tail sur­vey was that re­tail­ers should in­vest in show­rooms and not the en­tire store net­work.

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