Feb 232010

Here’s a question that has been plaguing me recently: how does a Facebook page compare in reach and effectiveness to a traditional email list in generating business and loyal customers for a small brick and mortar business? To be more specific, I am not talking about the corporate headquarters for a chain corporation – I am speaking specifically about a single-location privately owned retail establishment, or a specific store that is part of a larger chain. I’d like to examine the benefits of each of these means of reaching customers, their ease of use, and the specific ways in which each can be maximized to generate business and customer loyalty.

The Benefits of a Facebook Fan Page

With over 500 million users, Facebook has firmly established itself as the king of social media. And with that comes the ability to reach, connect with, and communicate with a ridiculous number of people. You can find fans all over the planet and have interactions and conversations with them nearly instantaneously.

And that really is what Facebook gets you: the ability of your customers to directly make comments about you, about your product, and about anything that you say on Facebook. You can get instant, free feedback (good or bad.) If you have a great Facebook fan page, updated on a regular basis with interesting content that grabs a person’s attention, people will want to comment on your page, and want to interact and be involved. The ability to quickly comment on a product image, of give a thumbs-up to a status update means the barrier between you and your customers is very low. Effectively using a Facebook page can be an amazing way to create and maintain customer loyalty. And after all, as a business, keeping and maintaining customers is our main goal. Facebook can be a fabulous tool for that. (A great example is lululemon athletica.)

However, if you treat your page like a traditional one-way communication (like a commercial, just shoving product info and self-promotion spam at people) no one will be interested, people will tune out, and you will get nothing back from your customers. (As an aside, I just looked up the General Motors Facebook fan page, and while they have over 100,000 fans, they have ZERO photos posted! What a missed opportunity to put product photos up there!)

Benefits of a Traditional Email List

Email, while limited compared to Facebook in terms of customer interaction, has a few distinct advantages for a traditional small business or retail store. First, you can sign up your customers immediately while they are in your store. It’s as easy as having someone write down his name and email address. You can input it into your listserve later or do it right then. Simple and easy, and you know your content will be delivered to the customer. Additionally, content delivered to an inbox is much less likely to be missed that an update in a Facebook news feed, which can be drowned out by dozens of friend updates. As long as you limit your emails to no more than about 1/week, most people won’t remove themselves from your email list and if you are delivering useful offers they will look forward to your emails. Part of the beauty of the opt-in aspect of email is that open rates can be very high – 30% is not unreasonable to expect to achieve if you have a well-designed template and information your customers want. Clickthrough rates can even approach 10% for some emails. (Data based on the Epsilon Email Trend and Benchmarking Report show average open rates to be 22.2% and clickthrough rates to be 5.9% – very good numbers!)

Adding clickable images, html, and tracking what your customers do with the information in an email can also be very easy to do, and extremely powerful. There are so many email management services and pieces of software out there vying for your business that finding one that suits your needs (and budget) is not difficult. Of course, inexpensive is not free, and that is one of the advantages that Facebook has over email.

Shortcomings of Facebook

One of the main drawbacks of Facebook for a small business is the need for your customers to opt in from their Facebook account. Rather than being able to take their information in the store, you have to hope that your customer will go home, sign into Facebook, and remember to go to your fan page and click to become a fan. (Or, you can hope they have a smartphone and pull it out and fan your business then and there.) But Facebook does require a greater level of action on the part of your customer, and it is up to business owners to find ways to encourage their customers to take that action.

Within Facebook, it is also important to remember that your photos, updates, and news items will be competing with all the other feed items that come flowing to your customers. Friend’s updates, other business page updates, and photo tags all flow into the news feed and dilute your content, reducing the chance that your information is read and digested.

Drawbacks of email

High open rates are a huge benefit of well-composed emails. Lack of interaction is definitely one of the main drawbacks. Email by itself will only serve as an opt-in commercial; to truly be effective at retaining customers you need to be driving your subscribers to an offer or page that is compelling to them, and that will encourage them to take action. As a retail store, that could be store events, sales, customer appreciation and loyalty events, images and copy of new products to whet customer’s appetites, etc.

And to maintain an effective email campaign and list, you’ll likely want to use an email service or program to create image-filled emails with tracking metrics. Without the ability to track clickthrough of specific items, you’ll never be able to judge what is effective and most important to your customers. Email services do cost money, and you want to make sure that your money is well spent and is increasing your revenue. And you need to be pushing for email opt-ins in store to maximize the reach of your list, and decrease cost per customer.

So How Do We Maximize the Potential of these Two Forms of Promotion?

Ideally, these two ways to reach customers will complement each other, and be part of a concerted strategy to connect with, and maintain or grow your customer base. With Facebook, some of what I have seen that is incredibly effective are special offers that only reach Facebook followers. Let your Facebook fans know that an offer is for them only and they will feel special and more likely to be more aware of future updates. Contests or giveaways that encourage users to post their own photos involving your product are also amazing at generating fan response and loyalty. And if you have your fans tag themselves in photos they post to your wall, their friends will see those photos and you can draw in and reach many more potential fans.

If you do any sort of event in your store, take photos of the event! Include handouts at the event with your Facebook url and let your store guests know they can go to that page and they’ll be able to see photos from the event. Nearly everyone loves seeing photos of themselves at events and this is a great way to get people to visit your page for the first time or come back to it and comment on (or tag) photos.

To maximize the potential of an email list you first need to be mentioning it to every customer in your store or business that shows interest for your store or products. Make sure you mention that you promote special offers and sales, and never share email addresses. But there has to be incentive for someone to want to be on your list. Once you do have an established email list, establish a consistent email format (include your store web page and a Facebook link in every email) and keep the emails to a regular frequency that doesn’t exceed one email per week. Make sure there is new information (new products, and new special or offer) in every email so that your customers will look forward to seeing that email in the inbox – they open the email because they want to know about what new special offer/product/event is that week.

Both email and Facebook can be amazing resources in reaching your customers and maintaining their loyalty – if used effectively. Just understand the strengths and weaknesses of each, create a plan of attack for both, and follow through with your plan. Remember though, the ultimate goal here is to connect with your customers, have them feel loyalty to your store, and make them want to be a part of your organization and what you are doing.

Good luck!

  2 Responses to “Facebook vs. Email for Brick and Mortar Businesses”

  1. […] Facebook vs. Email for Brick and Mortar Businesses […]

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