Social media for the masses

The battle for the Recommendation Generation’s pound will be fought in the social media arena and brands that shun the opportunity to get involved online could miss out on sales worth millions

Social%20networkers%20With almost one-fifth of the UK’s population already active members of social networking websites, it is time for brands to recognise the likes of Facebook, Bebo and MySpace as potentially lucrative sales channels.

Royal Mail commissioned think-tank The Future Foundation to explore the social networking phenomenon that now sees more than 11 million people using such sites – with more than one-third (38%) logging on to their profile at least once a day.

The results of the poll among 1,497 people aged 18 and over confirmed social networkers are a group that must not be ignored.

Importantly, there is evidence that consumers are now using the Web to wrest back control over their purchasing behaviour from brands. Two-thirds (66%) of social networkers are likely to buy a product as a result of a referral by a friend or online acquaintance – equating to 750m in online sales.

The opportunities offered by “The Recommendation Generation” are extensive. But the will of brand owners to engage people online must be tempered with a large dose of caution. Get your communications strategy wrong and you risk alienating these users, which could cause serious damage to any brand.

The group already wields considerable power and this will continue to develop as social networking gathers pace. The Recommendation Generation is young – 80% are between 18 and 24 years old, online – over 11 million active social networkers in the UK, and educated – the majority stay on in their studies until 18 or 21.

In the future, the importance of this group to the retail industry and marketers as a whole will only grow. Forecasts suggest that by 2012, 84% of people will have access to the internet, while 79% of homes will be broadband enabled.

The research also shows that almost two-thirds of UK consumers (63%) will be using the internet as a retail channel in four years’ time. Social networking is no fad – 80% of those who already have a profile expect to keep it, while more than one-third of today’s non-social networkers are considering signing up.

A recent Ofcom report also found British adults spend more time social networking than those in any other European country, and even the US. And, 81% of online social networkers have bought a product on the Web in the past six months.

It is clear that brand owners and retailers must learn lessons quickly to capitalise. Crucially, marketing in this environment is more about responding to consumer needs than crowbarring advertising content onto a website. In fact, providing an information service – whether exclusive product news, special offers or reviews – is much more likely to endear networkers to a brand.

Creating a conversation with consumers who have shared interests – mirroring the millions of online discussions that are taking place between friends online – is key. The survey found 38% of respondents would like exclusive product news and 37% are keen to view special offers. Meanwhile, social networkers thrive on user reviews of products: 27% of respondents would be likely to join a retailer-branded network if it gave them access to product reviews.

The marketing message is no longer about simply pinning a banner or pop-up ad to a web-page and hoping to attract attention. Some brands have even tried acting like a fellow consumer – Nike offered shoppers the chance to design their own footwear and gained valuable insight into what they wanted to buy next.

Brands that want a piece of this new online market would do well to build traditional tactics into their strategies. The report highlights the importance of tried and tested methods in boosting sales. For example, 45% of social networkers said they have bought products through a catalogue in the past six months.

According to Royal Mail’s Home Shopping Tracker Study 2007, the average online shopper spends 1,221 per year – but this jumps to 1,526 for those who consult catalogues before placing an internet order. The strength of catalogues will be their ability to enhance and complement the online shopping experience. So even though this group’s online purchasing power may be growing, it’s wise not to put all your eggs in one basket and forget about more regular forms of marketing.

The battle for the new online generation’s pound is set to be fought in the aisles of social media. Brands that shun the opportunity to get involved, or try the hard sell and alienate the communities they are seeking to access, could miss out on millions.

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Val Walker, Royal Mail head of multichannel retail, contributed to this week’s Trends Insight

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