The summer holiday season is once again drawing near, no doubt anticipated with a mix of relief and trepidation from local retailers. For many, the holiday trading period provides the primary sales income for the entire year.
And while last year we saw record spending post-Covid, this year is set to look a little different. Inflation and the rising cost of living are leading to a tightening of purse strings. The Australian Retailers Association (ARA) has predicted that, when supply chain price and population increases are considered, overall Christmas spending will be in decline.
There’s no doubt that in this environment, retailers will be assessing every possible avenue to engage customers and ultimately, sell products. Social media has grown enormously as a means of marketing to customers. Almost one in three Australians now visit social networks to look for information about brands and products. Other global studies have also found that Gen Z shoppers in particular are more inclined to spend on social media this holiday season – with roughly half saying they’ll buy at least some gifts through social media.
But social selling isn’t just a spray and pray advertising tactic. As with any retail sales channel, it demands careful planning and consideration to make sure any advertising spend yields fruit. Here are three tips to help retailers make the most out of their social selling strategy:
- Ensure cohesive inventory management
While it’s undeniable that social selling offers exciting opportunities for retailers, it’s important to remember that social selling is still another sales channel to add to the mix. Along with marketplaces, websites, apps, physical stores and the rest, social selling similarly opens the door to greater complexity when it comes to inventory availability and order fulfilment. And at a time when consumers are looking to spend less and focus on the essentials, retailers can’t afford to let them down by not having the stock in place to fulfil their purchases in a timely fashion (or at all).
Overselling results in cancelled orders and a poor experience for customers. It can also lead to the logistical headache of providing refunds. In this peak period, it will be critical for retailers to focus both on operational efficiency but also enhancing the customer experience. Keeping track of inventory across all sales channels and making sure the order cancellation rate stays down and things don’t sell out will be crucial to social selling success.
Unlike some legacy systems, today’s leading distributed order management platforms can help retailers react to real-time stock demands quickly, and tune safety stock levels to avoid stock outs and underselling. They also allow a delivery date to be provided as early and accurately as possible in the customer buying cycle, so consumers don’t get any unwanted surprises about when their order will arrive.
2. Back up social ads with available stock
It’s easy to understand why some retail brands will want to boost their social advertising in the lead up to Christmas. Social media accounted for a whopping 31.5% of total ad spend in Australia last year, a marked 11.6% increase from the year prior.
But to make sure that those precious marketing dollars are spent wisely, retailers must only advertise products that are truly available in the specified location, at the specified time. When customers click on a social ad that leads to a devastating ‘out of stock’ message, this results in not only wasted advertising spend that impacts Return on Advertising Spend (ROAS), but also a poor customer experience.
For social ad campaigns to be successful, retailers need “inventory aware advertising”. This means ensuring they can keep inventory data in sync across all warehouses, stores, and systems, in real-time. Modern Inventory Data Processing and Distributed Order Management systems enable them to show customers what’s really ‘in stock’ across all digital channels, to avoid disappointment and social ad campaigns that backfire.
3. Align and scale all customer service channels
The ultimate goal of any brand advertising – including on social media – is to drive greater awareness and interest in a brand or product. When customers become more acquainted with and interested in a brand – they are more likely to seek out additional information, or better yet, make a purchase. This will likely result in further referral traffic to other customer facing channels – for example online chatbots on the website or call centres.
With this in mind, retailers must make certain that all customer service channels are appropriately scaled to handle this increased volume of customer queries. By ensuring consumers aren’t left wanting, on any channel, retail brands can make the most of their social spend and have the best chances of converting sales and leaving a positive brand experience.
Social selling success this Christmas will be hugely dependent on the quality, accuracy and speed of inventory data. By not over or under stocking, retailers can protect their precious advertising budget and avoid futile social spend. This will also ensure they can give their customers the best possible brand experience – which will serve them long into the future.
Veronika Birnkammer is head of marketing APAC at Fluent Commerce.