Industry scan:Social Media and Retail,US and Canada December 2010

A quick overview of what people are doing

Sacha ChuaEmerging Technologies EvangelistIBM GBS CanadaThis presentation is based on my opinions and does not necessarily represent IBM's positions, strategies or opinions.

Key trends Drive in-store traffic through online promotions Encourage people to interact with you. Encourage sales by making online reviews available in-store. Simplify and expand the reach of recommendations. Make customers the best salespeople. Enable new shared shopping experiences. Bring the in-store experience online. Go to where people are. Serve customers anytime, anywhere.

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What are the numbers? Old Spice videos: 1.4B impressions, 27% year-on-year increase

in sales, website traffic up 300%... All in six months Gap: $11M sales from 1-day Groupon ($25 for $50) Dell: $6.5 M from Twitter click-through purchases over two

years eBags: $1.6M net additional sales after adding rate-and-review

(800% ROI on $200k cost)

How can you measure results for social media campaigns? E-commerce and coupon-based purchases Clickthroughs and other interactions Estimated reach

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Opportunities:1. Drive in-store traffic through online promotions.

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Opportunities:1. Drive in-store traffic through online promotions.

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Opportunities:1. Drive in-store traffic through online promotions.

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Opportunities:2. Encourage people to interact with you.

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Opportunities:2. Encourage people to interact with you.

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Opportunities:3. Encourage sales by making online reviews available in-store.

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898 reviews Sephora’s in-store displayspromote using their mobile app to see reviews, and some stores accompany products with printed customer reviews.

Opportunities:4. Simplify and expand the reach of customer recommendations.

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Opportunities:5. Make customers the best salespeople.

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Opportunities:6. Enable new shared shopping experiences.

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Opportunities:7. Bring the in-store experience online.

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Opportunities:8. Go to where people are.

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Opportunities:8. Go to where people are.

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Opportunities:8. Go to where people are.

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Opportunities:8. Go to where people are.

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Opportunities:8. Go to where people are.

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Opportunities:9. Serve customers any time, anywhere.

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Threats20

Customers expect more from websites and retailers.

Social media action and inaction have reputational risks.

ListeningSocial media policies

Regulations and platforms are moving targets.• Privacy• Security• Application programming

Adoption and community engagement take effort.

How do some Web 2.0 platforms make money? Facebook: Advertising revenues + 30% of transactions (virtual

gifts, etc.) Twitter: Free to use for users and businesses. Data revenue from

search engines. Advertising revenue from promoted tweets and trends. Fixed rate / impressions / CPC – model under development.

Foursquare (location-based): Free for users and businesses. Businesses can set up specials (mayor’s special, check-in special, etc.). No fees yet, as platform is being developed. Use to identify frequent customers, encourage loyalty, attract new customers, and market in a new way.

Groupon, LivingSocial, and other group-buying websites: Services keep ~50% of sales.

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Key trends Drive in-store traffic through online promotions Encourage people to interact with you. Encourage sales by making online reviews available in-store. Simplify and expand the reach of recommendations. Make customers the best salespeople. Enable new shared shopping experiences. Bring the in-store experience online. Go to where people are. Serve customers anytime, anywhere.Sacha Chua – Emerging Technologies Evangelist, IBM Canada – http://slideshare.net/sachac

This presentation is based on my opinions and does not necessarily represent IBM's positions, strategies or opinions.

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