Spicing Things Up
Most retailers recognize the value of having a social media strategy. At the same time, creating a truly valuable online presence often requires a mix of media that includes third-party sites like Facebook and communities unique to themselves.
“In the social environment, like in the real world, people hang out with people like themselves. You want to create a situation where you can pull them into one spot,” says Tim McMullen, founder, president and executive creative director of redpepper, a marketing firm with offices in Nashville and Atlanta. The idea isn’t “build it and they will come,” but “involve them and they will participate.”
That’s the path that Kirkland’s, the Nashville-based purveyor of home décor and accessories, has taken. Working with redpepper, Kirkland’s has created a robust online community at www.MyKirklands.com and boosted its presence on sites like Facebook. The result of this coordinated campaign? More online visitors, more customers and more sales.
Before beginning its work with redpepper in 2009, Kirkland’s sent promotions or coupons via e-mail once or twice a week to current and prospective customers. But e-mail offered only one-way communication; it didn’t really allow Kirkland’s to engage with its customers.
When redpepper began working with Kirkland’s, one idea was to develop a strong direct mail campaign, McMullen says. In light of the number of e-mail addresses the company had acquired — in excess of two million — the initiative began to focus on e-marketing and the use of social media, says Mark Krebs, vice president of marketing for Kirkland’s.
One goal, McMullen says, was to create an online community for Kirkland’s customers, a forum within which customers could converse and share ideas. The objectives of online media efforts differ from those of traditional media, where reach and frequency are the key performance measures, and the determinant of success is engagement, McMullen says. Therefore, it’s not enough for customers to simply see an ad; marketing should lead to some action.
At the same time, the online marketing efforts weren’t intended to necessarily focus on selling to customers, but to “provide design information and build the brand from the standpoint of the value and pricing of the merchandise,” Krebs says. In addition to enabling customers to interact with each other, they could connect with Kirkland’s employees and designers, who provide design tips and other relevant content.
Engaging with customers
MyKirklands.com launched in August 2009. Customers can participate in online discussions, review products and post photos of their homes featuring Kirkland’s décor and accessories. “In this case, the biggest value is the peer interaction and being around people that love the brand and love to decorate,” McMullen says. Many Kirkland’s customers are enthusiastic decorators who routinely update their homes. They’ll talk frequently and readily about decorating for the holidays, or post pictures of kids’ bedrooms that they’ve re-done.
To entice customers to the site, Kirkland’s relied on e-mail and promotions like “Décor for Four”: Groups of four friends participated in a drawing for $10,000 in Kirkland’s merchandise (split equally among the four). More than 5,000 people signed up for that promotion, generating more than 1.3 million page views, Krebs says.
Kirkland’s introduced its Facebook page in late 2009. There, the focus is more promotional, Krebs says. For instance, employees might post coupons or information about upcoming sales. As of March 2011, the page had more than 70,000 fans, and company research shows that 70 percent of Kirkland’s Facebook fans shop its stores between one and four times a month.
The company’s online promotions have helped boost both sales and margins, Krebs says. In July and December 2010, the company offered online coupons that customers could print and use in the stores. The promotions boosted sales by nearly $9 million and margin by $4.6 million: The incremental margins were enough to justify the promotion, Krebs says.
The promotions also have helped contribute to the strength of MyKirklands.com, which now has more than 150,000 members and generated more than 12 million interactions in 2010. Kirkland’s also captured 615,000 more e-mail addresses in the latter half of last year, Krebs says.
Kirkland’s launched e-commerce capabilities late last year. “We had pent-up demand within our MyKirklands.com following,” Krebs says. To be sure, the online store is still in growth mode and accounts for a small percentage of the company’s overall revenue. The site carries about 900 SKUs, compared with 4,000 in the company’s bricks-and-mortar locations. Even so, e-commerce helps meet some customers’ needs and will allow Kirkland’s to offer items (like sinks, for example) that are too big to accommodate comfortably in its stores. “We’ve got a lot of opportunities in e-commerce.”
Return on investment
Kirkland’s online efforts have helped add to revenue and profits, and Krebs and his colleagues have learned a few things along the way. One is simply the amount of resources needed to manage the online interactions with customers. Kirkland’s strives to review all of the millions of comments and customer interactions that occur on the site, and accomplishing this requires the efforts of the company’s customer service and marketing employees. In addition, Kirkland’s periodically calls in help from outside, including redpepper.
This arduous work offers a return, as Kirkland’s gains information that can guide its decision-making and planning: For instance, the homepage was redesigned based on customer requests that it be easier to navigate.
Participating in social media requires an ongoing effort, McMullen says. “It has to become a part of you. If it’s not a significant portion of your time and dollars, you won’t get anything out of it.”
At the same time, gaining a critical mass online is, well, critical. In order to have an effective online presence, a company needs a group with enough size that it can influence others. “You need your core customers to be involved,” McMullen says. “They will bring people to your brand.”