Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
The web-only retailer is conducting contests on Twitter. It’s using the social network to develop close, long-term relationships with customers and expand its customer base.
GEMaffair.com is tweeting. No, it’s not doing bird calls, it’s sending very brief electronic messages to followers of its Twitter account. The jewelry retailer is among a small but growing number of retailers using the unique social network to stay in constant touch with customers, getting them to engage with the brand frequently to hopefully boost customer loyalty, customer service and sales.
Individuals and businesses join Twitter and create a profile. From there they do two things: they become followers of other individuals or businesses and encourage others to follow them. Then they begin tweeting, sending out tiny messages, sometimes called micro-blogging, describing what they are up to. An individual might say something like, “I’m at Starbucks reading Chapter 7 of Club Dead, the third of the Sookie Stackhouse vampire novels.” A business might mention a new product just in or conduct a contest. Followers receive these tiny messages on their Twitter web page or mobile phone when they are signed in.
GEMaffair.com has been conducting weekly giveaways since the holiday season, offering entrants the chance to win select jewelry. It picks a day of the week and sends out a tweet announcing the contest, describing the prize, and telling followers to send a reply tweet to enter. Staff print off all the entrants’ tweets, toss them in a hat, and draw a winner. And it’s been picking more than one: it selects a winner for every 25 or so entrants. Hundreds of people entered the first contest in December, the retailer reports.
The jeweler has more than 600 followers on Twitter and says response to the contests has exceeded its expectations. What’s more, there’s a bonus byproduct: Every time a follower sends a reply tweet to GEMaffair.com, their reply tweet is broadcast to all of their followers. So, for instance, if 300 followers enter a contest, and each has an average of 50 followers, then the jeweler’s message reaches 15,000 people.
And that’s why GEMaffair.com is using Twitter: to establish close relationships with as many consumers as possible.
“The jewelry business is an old business, and it centers on relationships with customers, who like to visit a store not only to buy but to ask questions and become more informed,” says president Mike Jansma. “We do not have a bricks-and-mortar store but are in a bricks-and-mortar business. Social networking gives us a way to talk with customers and give them the information and service they’re looking for.”
Jansma says the return on investment with Twitter, as is the case with most social networking efforts, comes in the long term. Social networking, he says, is about engendering intimate relationships, and the payoff is two-fold: retailers get to learn a lot about their customers, and customers become very loyal and buy more merchandise over an extended period of time.
“With Twitter we can begin conversations with existing and potential customers where they can feel free in a non-sales mode to get answers on cleaning, repairing and any number of topics from a professional,” Jansma explains. “In general, e-commerce is very transactional, and that leaves out forming close relationships with customers. Social networking helps customers become more familiar with you and establishes trust.”