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Originally published April 6, 2010 at 10:00 PM | Page modified April 7, 2010 at 10:31 AM

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Retailers jump on social media bandwagon with Facebook, Twitter

Experts disagree about whether social media sites are there to build community or to sell products.

Seattle Times business reporter

Social media factoids

Starbucks on Facebook: Since creating a Facebook page in November 2008, Starbucks has gained an average of about 12,500 fans a day, or about one new fan every seven seconds, bringing its total to about 6.5 million and counting. A Facebook message in November about the arrival of red cups for the holiday sales season prompted more than 30,000 responses.

Costco's 'talking' chicken: Costco's $4.99 rotisserie chicken has a Facebook page with more than 600 fans. "At the moment this fan group is the only thing on Facebook that makes sense," writes fan Ron Hutchinson, of Seattle. "My head hurts thinking about how much of a deal this is!" says another fan, Mark Techaphunphol, of San Francisco. Turns out, Issaquah-based Costco did not create the page and doesn't know who did, said Jeff Lyons, senior vice president of fresh foods. It seems to have stoked some friendly in-store banter. "Where's the steak page? We do great steaks," Lyons said, laughing. "So the guys in our service deli are crowing a bit — 'Hey, we've got a Facebook page. You guys don't!'"

Nordstrom on Twitter: The manager of Nordstrom's Bellevue Square store, Doug McCoy, recently sent invitations through Twitter (NordstormBVUE) to a real-world fashion show. The tweet-up, as it's called, drew more than 50 people to the Bellevue Square store to see new spring clothes and talk about trends with Nordstrom buyers. Spokeswoman Brooke White said the store saw a same-day uptick in sales of designer clothing, accessories and shoes, which she partly attributes to the tweet-up.

Source: Seattle Times research

To spread the word about a new skin-care salon in West Seattle, owner Karen Jahn got her social-media act together and hired a publicist to reach out to several hundred customers on Facebook and Twitter.

Through teaser messages, fans of Jahn's Wax Bar in Ballard were told about the cross-town opening and given a chance to win weekly prizes.

"I don't know if we got many new clients out of it," said Jahn, who spent more than $800 on the monthlong promotion. "But we got more people to follow us, and now more people are aware of the Wax Bar."

Not surprisingly, retailers want in on the explosive growth of Facebook and Twitter, and they're using the social Web sites to talk about upcoming events, products and problems, all in the belief that it'll help them stay connected to customers and win new business.

Forrester Research, a Cambridge, Mass.-based technology research firm, figures about 70 percent of retailers are on Facebook or MySpace, and more than half are on Twitter.

"In a down economy, you really need to focus on your best customers, and this jumped out as a great way to connect with customers and build a little bit of a deeper relationship with them," said Mike Gatti, executive director of the Retail Advertising and Marketing Association, a division of the National Retail Federation.

Retailers scrambled last year to increase their use of social media for the crucial holiday sales season, and although the precise impact has not been calculated, Facebook and Twitter are partly credited for a slightly better-than-expected season.

Now, amid a modest uptick in consumer spending, retailers are tapping peer-to-peer networks to supplement traditional advertising without spending a lot of extra money, Gatti said. It's giving rise to a new type of marketing professional who can help retailers build a large audience through videos, photos and short-form writing.

"You can't just set up a Facebook page and that's the end of it," Gatti said. "You have to have someone running that page, reading comments, responding to questions and making sure you're promoting the growth of that group."

Facebook, which recently surpassed Google as the Internet's most-visited U.S. site for a week, lets retailers set up free pages and accumulate fans. Twitter, which boasts 50 million posts a day, or 600 "tweets" a second, allows retailers to broadcast 140-character messages to followers.

Evo, a Seattle seller of skis, snowboards and other outdoor gear in the Fremont neighborhood, has a part-time employee dedicated to the day-to-day management of its blog, tweets, and Facebook and My Space pages. Recent posts include a YouTube video of several employees doing daredevil stunts at Stevens Pass.

"You'll see other retailers do videos about selling products," said Shilo Jones, marketing director at Evo. "For us, social media is about extending our lifestyle to a broader audience. We're not so driven by the need to monetize it."

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Experts agree that online water-cooler conversations can help businesses forge stronger relationships with customers. But it's less clear that building a large fan base leads to a significant increase in sales, and experts disagree about the extent to which retailers should use social networks to push promotions.

"You're not there to sell," said Eric Best, chief executive of Mercent, a Seattle software company that helps retailers sell online. "You're there to participate as an active member of a community."

Mercent worked with Atlanta-based tea chain Teavana to add an ecommerce component to its Facebook page. A small "shop" tab at the top of the page enables fans to browse some 830 tea-related products. Best said he felt it was important to not "bombard" fans with the shopping tool.

"You have to establish dialogue with customers and add value without being pushy," he said.

Mighty O Donuts, which caters to local vegans, uses Facebook to tell more than 800 fans about new menu offers and limited-time deals. It doesn't want to come across as "salesy," though, so it also posts pet photos, plus event information for comic-book readers and vegetable gardeners.

"It's great to be able to pitch sales, but it's more about getting feedback from our customers," said promotions coordinator Sara Beth Russert, who manages Mighty O's social-media activities. "It helps us get a handle on what the next season's flavors should be and what people look for in a donut."

For some Web junkies, Facebook and Twitter are an appealing place to see new products and find out about deals.

"The conventional wisdom says, 'don't promote to people. These are personal areas, and people don't want to be sold to,'" said Kevin Ertell, vice president of retail strategy at ForeSee Results, an ecommerce consultancy in Ann Arbor, Mich.

Ertell, taking the contrarian view, said a recent ForeSee survey found nearly half of social-media users who follow a store want to hear about deals and products.

"Savvy retailers are making sure their fans receive value in exchange for their digital vote," said Clay McDaniel, co-founder of Seattle marketing firm Spring Creek Group.

The "value" he talks about might come in a coupon code, invitation to a special event or quick response to a question. "The implicit relationship is, 'please become a fan or follow us, and if you do, we'll make it worth your while.'"

Starbucks, which touts itself as the No. 1 brand on Facebook and Twitter, has a saying, "We make friends, not offers." It recently began testing a customer-rewards program at Foursquare, a year-old site that lets people broadcast their whereabouts.

"It's not that we don't ever do offers, because we do, but that's kind of secondary," said Matthew Guiste, who heads a four-person social-media team at the coffee company's Seattle headquarters. "For us, it's really about sharing the Starbucks experience behind the scenes."

Last fall, Nordstrom began encouraging store employees to use Facebook and Twitter to talk with customers about work-related matters — everything from new handbags to holiday hours. The Seattle-based retailer also published a two-page set of guidelines, such as "be a good listener" and don't boast.

"For some of our customers, this is how they want to be communicated with," said spokeswoman Brooke White. "They really don't want a phone call. They'd rather just get a tweet."

Still, recent studies of social-media users affirm what merchants have long known: Face-to-face communication remains important, even in the digital age.

Four of 10 social-media users rank in-person conversations as the top reason to go online and search for a particular product, store or restaurant, according to a recent survey by BIGresearch for the Retail Advertising and Marketing Association.

Kenmore resident Duane Hopper said he became a Facebook fan of Tall's Camera after buying a Sony digital camera at the local retailer's Bellevue Square store. Now, when he wants advice on how to use the camera, he talks with Tall's employees through Facebook.

"I felt a connection," Hopper, a real-estate agent, said of becoming a Tall's Facebook fan. "They spent a lot of time with me."

Amy Martinez: 206-464-2923 or amartinez@seattletimes.com

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