Convergence of Database Marketing and Social Media for Retail Brands

Europe’s sovereign debt crisis is forecast to result in a “not-so-good” economy. This worrying outlook has driven more and more retailers in Europe and China to focus on retaining businesses through their existing customer database and social networks. Given a diminishing amount of marketing budget, the biggest question for marketers in 2012 is how to make the most out of it while reaching ROI expectations.

Increase Competitiveness by Adopting an Online Business Model

In fact, many large scale retailers such as grocery stores and supermarket chains in North America, Europe, as well as China (VANCL, Moonbasa, Taobao Mall, Jingdong Mall) have adopted the robust online business model and have resulted in great success within these few years. Many successful stories are found. For example in the United States, many Canadian shoppers have changed their shopping habits ordering from Canadian websites to U.S. retail websites. Either due to the international shipping services or the attractive currency exchange rates, an increasing number of Canadian shoppers are purchasing from retailers in the United States. According to the online consumption of 2011, it showed that Canadian consumers are spending more on foreign e-commerce than local ones.

It is known that thousands of mainland Chinese people visit retail stores and shop for luxury brands in Hong Kong every day, and marketers are aware of the leading business opportunities. Considering the Chinese consumers could only buy so much at each visit, Hong Kong retail stores could possibly provide a cross region such as international shipping services on the digital platform. This way, customers from other countries could engage in transactions at any time.

Establish a Database Marketing Strategy

That strategy should include: build a database, retain loyal customers, and optimize word-of-mouth strategies.

In China, both offline and online retail stores allow customers to enjoy an easy shopping experience without the hassle of researching different brands.

However, with this convenience in mind, it has been more difficult for marketers to retain customers and to gain their loyalty because of the fierce competition surrounding various brands.

External factors such as promotional activities and sales will only attract customers to an extent. Launching promotional campaigns on various social media platforms contributes to customer database acquisition. It cannot be more attractive to give out their contact in exchange for discount offerings. Not only do these campaigns update and clean the database, they also help to gather information that is essential for successful email campaigns. At the same time, customer relationships are maintained, and a loyal customer base is also established.

Selecting the Most Appropriate Social Media

Since social media has been being adopted in marketing practices, many Chinese marketers have questioned whether or not the social media channels would replace email marketing. In fact, this convergence is giving marketers greater opportunities to grow their business in a more affordable way. The lines between email marketing and social media marketing will continue to blur. Certainly, the two channels could combine and deliver an improved ROI when employed in conjunction. While eDMs enable businesses to make the messages known, social media ensure that the messages spread and expand reach.

For example, based on Nielsen data, one out of every four minutes is spent online in the United States. Social media is regarded as one of the most popular online activities. It has become part of consumers’ lives as opposed to just a source of entertainment. While Facebook remained the top social media network in Hong Kong, Google+ has successfully entered the social media fray and becoming widely used in Hong Kong as well. Marketers will have better control over the key performance indicators (KPIs) by gaining easier accesses to measurement tools and analytics.

In 2012, we expect that integrated marketing tactics will become more sophisticated in China and Hong Kong. With the rise in prominence of email, social media, mobile, and viral marketing, marketers will continue to embrace a more multi-channel approach and integrate numbers of digital channels to satisfy customers while improving ROI.

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