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Social networking is growing into a critical business tool in manufacturing and retailing, and SNEWS is exploring its use and influences in the fitness industry. A similar article focused on the outdoor industry ran in the summer 2009 SNEWS Outdoor magazine. If you’re considering a social media strategy, check out the Oct. 16, 2009, SNEWS article, “Social media primer: Getting your business started tweeting and friending” in Business Tools.
In an interview with Twitter inventors Biz Stone and Evan Williams, New York Times columnist Maureen Dowd asked Stone, “Did you know you were designing a toy for bored celebrities and high-school girls?”
Dowd’s question, of course, was tongue-in-cheek, as it has become clear that Twitter and other social media platforms, such as Facebook, have become serious tools for businesses.
Reuters reported in summer 2009 that the computer company Dell earned more than $3 million over two years from people who followed its Twitter feed and clicked through to the company’s website to purchase products. Of that total, $1 million was generated between January and June of 2009. Granted, $3 million is a relatively small amount of money for a company that earned $12.3 billion in just the first quarter of 2009, but it definitely shows that social media can help drive business and generate profits. While online social networks were once the place for casual banter, companies now consider them critical tools for marketing and strengthening their brands.
“We’re just starting to get our feet wet, but I know it’s definitely having a positive effect,” said Dai Manuel, COO of Fitness Town (www.fitnesstown.ca), a specialty fitness retail chain based in Vancouver, BC, which has been using social networking sites for about two years. “We’ve noticed that the foot traffic in our stores has been up 10 percent to 20 percent, depending on the location. I’ve even had people come up to me at networking or business events, and they’ve said, ‘Oh yeah, I saw you on Twitter,’ or ‘I read your blog.’ It’s a slow process, but it’s starting to gain a lot of traction.”
While Fitness Town is exploring the possibilities of social media sites, others in the fitness industry have been slower to respond. The idea is still fairly new in business, but that’s changing quickly.
“Businesses are paying attention now, and 2008 was the tipping point for it,” said Jeff Risley, vice president and social media analyst for Barkley Public Relations. While social networks have actually been around since 2003, they have now become mainstream.
“Facebook started exploding in 2007 and 2008 to audiences beyond the 18- to 25-year olds,” Risley told SNEWS®. “When it became the largest social network, surpassing Myspace, the 35- to 50-year olds were on it.”
On Sept. 15, Facebook announced that its number of users worldwide reached 300 million. Having drawn the masses, social networks now provide fertile ground for companies to grow their consumer base.
Connecting with customers
Risley said businesses should take advantage of the social media boom because of what he calls the “relationship rule.” He said about 83 percent of people trust friends and family most for recommendations on products and services. Remarkably, 50 percent of people trust recommendations from perfect strangers. It used to take a village to raise a child, now it takes one to shop.
Scan the Facebook pages for fitness manufacturers and you’ll see plenty of consumers offering their opinions of products, such as the message Louis Devizia posted on the Life Fitness Facebook page on Sept. 11 at 5:10 p.m. “Work out on an R3 recumbent stationary bike…Awesome product, by far the best recumbent I’ve ever found. 70 lbs. lost in 2009, couldn’t have done it without this product. Good work folks.” (Click here to access the Life Fitness Facebook page.)
Other consumers are free to check out Devizia’s post on the “wall” of the Life Fitness Facebook page, ask questions, swap information and gather more facts to inform their buying decisions. A spokesperson who moderates the page told SNEWS she only posts about once a day but the goal is to make sure her posts are not just advertising, but instead are focusing on establishing relationships and a community. Without much promotion, the company reached 3,300 “friends” in about six months. This type of forum provides the consumer helpful information from like-minded people, she said, and the real power of the exchange is that the advice is free of bias from the company.
“We know that when consumers are making large purchases they’re looking at what other consumers are saying,” the Life Fitness spokeswoman said. “It’s nice to know you’re not getting a paid or biased opinion, but getting it from people who are like you.”
Most companies in the fitness market that are tapping into social media — even the large retailers and manufacturers — are new to the scene and are in the early stages of learning how to best take advantage of the opportunity. But companies outside the fitness industry who were early adopters of social media are now devising clever ways to build communities around their brands.
JanSport (www.jansport.com), one of the leading manufacturers of backpacks, launched its Facebook page two years ago, and it has about 70,000 members. This summer, the company added to its website the “My JanSport” application, which allows shoppers to post products to a Facebook page and share with friends. Facebook friends can view each other’s products, rate them and make comments.
“So, it becomes a sounding board on making purchasing decisions,” said Courtney Blacker, JanSport’s director of brand marketing. “It creates a place for consumers to communicate with each other, and allows us to understand the dialogue between consumers, and we can let them know what’s going on with the brand.”
A customer service tool
On Facebook pages and blogs, people not only swap gear recommendations, but also voice their opinions about companies.
“Think of it as the world’s largest focus group,” said Risley. “If you can monitor and pay attention, you’re going to see what your customers are saying about your brand.” He advises that companies engage in this conversation, and adds that social networks can be used effectively for customer service.
“I try to monitor the conversations on Facebook and Twitter and find out what people are saying about my brand,” said Manuel of Fitness Town. “If I see anything negative, I make a quick query to that person to find out what sales experience turned them off. I try to take those negative experiences and make something positive.”
While social media sites can enhance your customer service, they can also strengthen your relationships with people.
G&G Fitness Equipment (www.livefit.com), a chain of fitness specialty shops in Ohio, Pennsylvania and New York, began using Facebook sites a year and a half ago. John Parson, G&G’s director of retail sales, told SNEWS the sites help draw customers into the retail stores more often.
“This is not like an apparel shop where most customers need to come in five or six times a year regularly. They may not need to see us for years in between,” said Parson. “We’re trying to create more touches.”
When a person shops at a G&G Fitness Equipment store, the salesperson asks the customer if he or she would like to continue communicating with the store via Facebook.
“We’re really open with customers in requesting their email address and explaining different programs we have, and gauge their interest,” said Parson. “Some are reserved and don’t want to share more personal information, and some are really open about learning more about fitness and specials or sales. We let them opt in or opt out whenever they’d like, and it has been received positively.”
Through Facebook, G&G salespeople provide customers with information on health and wellness as well as exercise tips. Occasionally, they also provide information on new products and sales events. The key, said Parson, is that the store does not always hit the customer with messages regarding sales or discounts. “We don’t want to just hit you with sell, sell, sell,” he said. He doesn’t want the customer to view the store as a source of spam, but rather as a trusted source of helpful information.
Bob Phibbs, a retail consultant who has appeared frequently on MSNBC’s “Your Business,” warned that business owners must understand that social media should not be used to push traditional advertising messages. “If all you can tweet about is that this weekend you have 50 percent off (a product), no one is going to follow you. You have to be interesting and not just hawking your wares,” said Phibbs.
Risley said one of the biggest mistakes companies make is using a social network like a media channel rather than a way to build customer relationships. “Companies who are just pumping messages through it as though it were television or a print ad get ignored pretty quickly,” he said.
G&G Fitness has apparently struck the right chord with customers, and Facebook is helping to drive consumers to the brick-and-mortar stores. “The customer may not be spending thousands of dollars on big items, but they get accessories, and it keeps us on the forefront of their mind,” said Parson.
A better marketing strategy
Parson of G&G and Manuel of Fitness Town said that blogs, Facebook and Twitter have proved successful enough that they are taking marketing dollars from traditional advertising and marketing venues — radio, newspaper, TV, yellow pages — and investing more in social media.
“Ten years ago, it was a major part of our advertising budget to have these full-page and half-page ads in the yellow pages under fitness equipment,” said Manuel. “We’ve seen that cut down to just bolded listings, and we’ve taken the revenue we’re saving and re-allocating it to online marketing. We’re seeing a much better return on that investment now.”
Phibbs encouraged retailers to invest more in social networks, especially blogs, and move away from traditional advertising and marketing. “The old media is dying around us –yellow pages, newspaper ads, just won’t do it anymore,” he said. “Social media is the new bread crumb. Once you put these things out there on the Internet, it provides more ways for people to find you. We used to say it was location, location, location. That’s still true for brick and mortar, but the location on the Internet is the same thing.”
There are doubters out there
While there’s no doubt that social media’s influence is increasing rapidly, there are certainly business owners who still do not believe it is a necessary or even legitimate tool.
This year, in the annual SNEWS Retailer Survey, we asked if fitness retailers used social media and, if so, which sites they were using, and whether they were beneficial.
One respondent said, “No, we are not, and currently do not have any reason to think these particular websites have any value. The latest research we have read is the advertising media sees no immediate value.”
While some doubt the potential for real revenue, others are concerned that a social media strategy will lead to employees wasting time on the Internet.
“Our employees have limited access to the web,” wrote one respondent to the SNEWS Retailer survey. “We want them selling product and focusing on sales rather than waste time on ‘other’ websites not associated to fitness.”
Indeed many business owners are concerned that their employees will waste company time sending out useless “tweets,” or Twitter messages. According to a survey by Robert Half Technology, a leading provider of information technology, more than 54 percent of chief information officers interviewed recently prohibit employees from visiting social networking sites for any reason while at work.
There is also the perception that social sites do not draw potential customers (i.e. adults ready to buy products), and that they are mere distractions for entertaining kids.
Responding to a SNEWS Mini Survey question on our website, “Are you using social media/social networking websites (e.g. Facebook, MySpace or Twitter) for your business?” one fitness retailer said, “No — prepubescent teens can’t buy True treadmills.”
This person’s response implies that social sites are the realm of children and do not support serious pursuits — but the U.S. State Department would disagree.
According to a Time magazine article, during the second weekend in June the State Department asked Twitter to delay a network upgrade so that Iranians could use the service to organize protests of the country’s presidential election. As the Iranian government shut down all traditional media outlets, the only information flowing in out of Tehran came in the form of tweets. Indeed, social media can support weighty issues.
There’s plenty of evidence that online communities can be powerful, and the business community is starting to understand that social media can deliver real results. “Our website traffic grows monthly,” said Manuel. “And the number of Twitter followers is up to 40,000. It definitely drives traffic back to our blog, and ultimately back to our website.”
If social media was once a plaything for bored celebrities and high-school girls, it is now a serious tool for those who mean business.
For pointers on how to get your social media strategy started, check out the Business Tools section of the SNEWS website by clicking here.