JC Penney Advances Social Sales Model; 3 Tips for Companies That Want to Follow Suit
J.C. Penney has became the first major retailer to move its entire online inventory to Facebook, allowing shoppers to not only view its products but also purchase them from within the social media site. As with most social sale efforts, shoppers can see items that their friends have purchased in their news feeds and – hopefully according to JC Penney’s view – click on through to view the catalog.
It is a natural evolution for the online retail sales model. “Retailers want their channels to be where their customers are,” said Jason Taylor, vice president of global product strategy for Usablenet, which built the Facebook operation for J.C. Penney. “They’ve recognized that Facebook is another place they need to be in front of their customers.” (via Fast Company).
JC Penney is not the first retailer to try out this model. Procter & Gamble have been selling Pampers and other household items through its Facebook page. On a smaller scale, Wharton MBA candidates Cherif Habib and Stephan Jacobs recently launched a private-sales site that caters to college students and can only be accessed from Facebook, according to Portfolio. Their go-to-market strategy is simple: give college students access to top brands via the channel they use the most. Then there is the networking heft of the Wharton alumni association.
3 Tips If You Want to Follow Suit
JC Penney, with some 250,000 products for sale on Facebook now, is the most ambitious social sales endeavor to date. As this model gains traction and more industry knowledge is accumulated, brands should keep in mind the following:
1. Buyers on Facebook have different expectations about the sales process. Vastly different. It is a far more equalitarian, free-for-all atmosphere, with potential buyers often asking detailed questions and expecting an almost immediate response. Perhaps nowhere else is the sales-marketing-customer service function so tightly integrated as it is on a social sales site. If you can’t do it right, it might be better not to do it at all.
2. The social part doesn’t always work to your advantage. Sell something on a social network. The buyer tells a friend. The friend, who respects the buyer’s opinion, goes to your site and buys the product too. Lather, rinse, repeat. That is how it is supposed to work at any rate, but recent research is suggesting that friends’ recommendations only go so far online. WSL Strategic Retail, for example, finds that online shoppers tend to value the opinions of review sites for information about products more than their online social networks.
3. Be wary of new technologies – or at least their promised ROI. Brand engagement on Facebook? Okay, fine, we know it pays off one way or another if done correctly. But most of these channels are still proving themselves – even the wildly successful Twitter. Remember Twitter’s Early Bird offering, which it rolled out with much fanfare this year? Indeed it seemed like another no brainer sales tool, with firms able to offer discounts on a first-come, first serve basis. But earlier this year Twitter decided to set aside Early Bird in favor of other, presumably more successful, products.