Social Engagement

Much of the conversation at NRF’s 99th Annual Convention & EXPO focused on the economy – from discussions on recovery to how the customer has changed – but it was impossible to miss the constant chatter about two powerful trends.

As the economy begins to recover and retailers start to emerge from their cocoons, companies are finding low-hanging fruit in digital initiatives that allow retailers to cultivate relationships with their most loyal fans and connect with potential new shoppers. Much of the excitement over social media stems from the buzz it received during the holiday season. From Wal-Mart giving its Facebook fans the inside scoop on a new shipment of popular Zhu Zhu Pets to 1-800-Flowers’ program that enables people to shop for products directly from its Facebook wall, many retailers use the site as the linchpin of their social media strategy.

Retailers are also charging ahead with Twitter, using the site to get instant feedback from customers on new products or promotions. (Fashion maven Tory Burch acknowledged during a Super Session that responses to a tweet about her disdain for removing shoes at airport security is leading to a new product: travel socks.)

Other retailers are diving headfirst into mobile commerce. Within the last year, PETCO, Sephora and Moosejaw launched programs that enable customers to access ratings and reviews of products in stores through their mobile phones, and other companies offer sophisticated store locators and inventory information in a mobile-friendly format.

Of course, a tremendous amount of mobile hype centers on the iPhone, with each month bringing a flood of interactive, creative applications from U.S. retailers. Last month, Overstock.com launched an app featuring a daily lotto: Customers can virtually “scratch off” a ticket to determine if they’ve won free shipping or discounted merchandise. QVC, Dairy Queen and Macy’s have dipped their toes into mobile applications as well.

Retailers aren’t moving forward on these projects just to keep up with the Joneses. Companies that offer iPhone applications are experiencing a very tangible return on investment, bringing in new customer dollars while maximizing sales from existing customers. eBay says its iPhone app has generated $500 million in sales; Pizza Hut’s application, which offers users 20 percent off their orders and a game to play while they’re waiting, generated more than $1 million in its first three months.

More case studies and examples of the power of social media and mobile commerce will likely emerge from NRF’s inaugural Mobile Boot Camp in San Francisco next month. The day-long crash course coincides with the Retail Innovation and Marketing Conference.

While retailers continue to grapple with the effects of the economic downturn and strategize about long-term growth opportunities, one thing is certain: Social media and mobile commerce provide a relatively inexpensive way for retailers to grow. These digital initiatives are quickly becoming retail’s future — and that future is starting right now.