The lawsuit takes aim at companies that pay Amazon customers to write and post reviews.
Those 140-character messages reach an affluent and engaged audience.
Josh Bernoff needed to replace the car adapter for his Garmin GPS navigation system last summer. And, because he was headed out of town the next day, he needed the device immediately.
Seeking help finding an adapter that would work with his device, he turned to Best Buy's Twelpforce, a customer service program that enables consumers to ask Best Buy employees questions via Twitter. "Where can I get a replacement car adapter for a Garmin in a hurry? Do you have them at the stores?" he tweeted.
Nine minutes later a Best Buy sales operator in Mansfield, Texas, replied that there were two possible replacements available online, which should also be available in stock at his local store in Burlington, Mass. Rather than assume they would be there when he arrived, she gave Bernoff the Burlington store's number to call to ensure that the car adapter was in stock. It was, and when he drove to the store to pick up the adapter he also bought an iPad that he had been eyeing for some time, along with other merchandise. The total sale came to more than $1,100 beyond the car adapter.
That experience demonstrates how retailers can successfully leverage Twitter to spur sales—even when that retailer is ostensibly using the channel for customer service, says Bernoff, Forrester Research Inc. senior vice president for idea development, who studies online social networks. "Because of Twelpforce I ended up at a Best Buy store," he says. "Once I was there I figured I might as well get the other things I was looking for."
Because Twitter messages are so short—140 characters or less—people read them constantly, often on mobile phones, whereas they are more likely to check e-mail only when they have time to read longer messages. As a result, Twitter provides a kind of instant engagement that retailers are just starting to learn how to use, to answer customers' questions, ˆ la Twelpforce, but also to build buzz about sales, host special events for Twitter followers and even to involve them in deciding what a retailer should carry.
Twitter can be an attractive marketing vehicle even though its audience is still relatively small—just more than 7% of the U.S. population 12 and over, or roughly 17 million consumers, according to an Edison Research report. That's far smaller than Facebook, which is used by more than 41% of the U.S. population. But the consumers using Twitter can be particularly valuable because they are better educated and more affluent than the general population, says the report. For instance, 30% of Twitter users have a college degree, versus 27% of the U.S. population as a whole.
And 51% of active Twitter users follow companies, brands or products on social networks. That means the opportunity is ripe for retailers to find ways to leverage the microblogging platform. And retailers are still discovering the best ways to make use of Twitter, which only made its debut in July 2006.
One way a retailer can regularly connect with consumers is to host Twitter parties, an interactive, party-like dialogue within Twitter for a set period of time. Attendees use a common hash tag, such as #Nikeblowout, so that any Twitter users searching for that term on the social network can find their way to the conversation stream.
The host keeps tweets flowing by peppering party attendees with questions and comments that revolve around a particular brand or topic. To keep consumers engaged, the host also doles out giveaways such as door prizes, a grand prize and coupons.
Debbie Weiner, owner of online-only stain-resistant furniture retailer Slobproof, uses Twitter parties to drive traffic to her site during slow periods. "Most of my sales are on Monday mornings, mainly because after being home all weekend with a slob, a homeowner decides she needs to do something about her furniture," Weiner says. "But Tuesday or Thursday at 3:30 p.m., I hardly ever make a sale."
Hoping to turn that around, Weiner began hosting Twitter parties on Tuesdays and Thursdays at 3:30 p.m. Eastern time, working with social media strategist Kristina Libby, a partner at online marketing firm KMV Media. Weiner says that's a time when many stay-at-home moms—part of her core customer base—across the country are home and their children not yet back from school.
To draw consumers to the event, Libby of KMV Media contacts about five mom bloggers and gives them a few items that they can use as giveaways to publicize the event. She also posts updates on the retailer's Facebook page, tweets about it on Twitter and writes about it on the retailer's blog. KMV charges retailer clients a flat monthly fee of $3,000 to $7,000.
As many as 700 consumers have attended the retailer's Twitter parties, such as a recent one Weiner co-hosted with paint manufacturer Benjamin Moore & Co. During the party Weiner encourages consumers to visit Slobproof.com with tweets such as "Has anyone visited the slobproof site. What's your favorite piece? What Benjamin Moore color would match it??"
"We have hundreds of people online with us commenting on everything related to my business," says Weiner. "I'll throw out a question about whether people like slipcovers and I immediately get a response. Twitter parties give me an opportunity to address several hundred potential customers at once. I ask questions, they ask questions and we make sales that I might not have made otherwise."
The parties increase traffic to Slobproof.com about 10 times from the typical traffic of six or seven visitors on a Tuesday or Thursday afternoon, Weiner says.
Weiner knew what she wanted—more traffic during slow periods. And having that kind of clear goal is key to achieving success on Twitter, says Augie Ray, a Forrester senior analyst. "A retailer getting on Twitter needs to define who its audience is and what its objective is," Ray says.