Marketing Dec 2, 2016

Peo­ple Are Tweet­ing about Your Prod­ucts. Will It Boost Sales?

Solic­it­ing user-gen­er­at­ed con­tent can be a pow­er­ful way to engage customers.

Yevgenia Nayberg

Based on the research of

Edward Malthouse

Bobby J. Calder

Su Jung Kim

Mark Vandenbosch

After hik­ing to the top of a moun­tain a few years ago, Robin Arrachart took a pho­to of the sweep­ing vista, with her stur­dy shoes and snack clear­ly in the frame. So when the mak­ers of her snack — a Kit Kat can­dy bar — ran a Fan of the month” Face­book con­test ask­ing peo­ple to share snap­shots tak­en while eat­ing the choco­late, she had a win­ner on her hands.

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Arrachart’s win­ning sub­mis­sion is an exam­ple of user-gen­er­at­ed con­tent,” or UGC, which is increas­ing­ly being sought by com­pa­nies on social media. As opposed to sim­ply ask­ing peo­ple to tweet or post that they bought a cer­tain prod­uct, UGC con­tests encour­age con­sumers to share more details about their expe­ri­ence with a brand. By solic­it­ing UGC — a pho­to, com­ment, or post about how a buy­er relates to a brand — com­pa­nies obvi­ous­ly gain a greater aware­ness of what cus­tomers are think­ing, as well as get mate­r­i­al that can be used for advertisements.

Beyond this, how these activ­i­ties help sales is a mys­tery. Could UGC direct­ly increase a company’s rev­enue? Put anoth­er way, can describ­ing a brand expe­ri­ence actu­al­ly affect a consumer’s behavior?

Com­pa­nies keep track of what con­sumers say on social media,” says Bob­by Calder, a pro­fes­sor of mar­ket­ing at the Kel­logg School. But it is more about mon­i­tor­ing sen­ti­ment than try­ing to fig­ure out the con­se­quences for sales. It has been very dif­fi­cult to make the link between what peo­ple do on social media and sub­se­quent pur­chas­ing behavior.”

In a world awash with adver­tis­ing, can we find new­er, even more pow­er­ful ways of build­ing brands?” — Bob­by Calder

So Calder and col­leagues set out to under­stand how a person’s social media posts about a brand could influ­ence their pur­chas­es. Based on their pre­vi­ous stud­ies, the team sus­pect­ed that user engage­ment — the per­son­al con­nec­tion that a con­sumer shares with a prod­uct or brand, as demon­strat­ed by the con­tent they cre­ate — would prove to be more impor­tant than a mere like” or tweet.

They dis­cov­ered that this was, in fact, the case. And the impact of that per­son­al con­nec­tion changed con­sumer behav­ior for sev­er­al weeks.

An Ide­al User-Gen­er­at­ed Con­tent Experiment

It is dif­fi­cult for com­pa­nies or researchers to sep­a­rate the impact of social media activ­i­ty from oth­er fac­tors that could boost sales, such as spe­cial pro­mo­tions or the launch of a new line of prod­ucts. But one par­tic­u­lar social media con­test pro­vid­ed the researchers with the ide­al data.

Since 1992, a coali­tion loy­al­ty pro­gram in Cana­da known as the Air Miles Reward Pro­gram (AMRP) has offered con­sumers reward points for pur­chas­es at a wide range of stores. Con­sumers swipe their loy­al­ty cards to accu­mu­late points when they buy gas, gro­ceries, appar­el, or oth­er prod­ucts, and can then redeem their points for mer­chan­dise, gift cards, or trav­el rewards. (Despite its name, AMRP is not affil­i­at­ed with any air­lines). In turn, AMRP receives mon­ey from par­tic­i­pat­ing com­pa­nies when cus­tomers use AMRP cards dur­ing a pur­chase at one of their stores. 

In Decem­ber 2011, AMRP launched a win­ter con­test.” In exchange for a chance to win reward points, mem­bers were asked to share their wish list for what they would do with extra points. Near­ly 8,000 cus­tomers par­tic­i­pat­ed by post­ing on an AMRP social media site. 

The nature of the con­test pre­sent­ed a strong oppor­tu­ni­ty to explore whether UGC trans­lates into revenue.

This was not just anoth­er social media activ­i­ty some mar­keter dreamed up,” Calder says. It has all the hall­marks of poten­tial engage­ment: mem­bers have to state a goal in their life and talk about how it relates to their use of the brand.” 

Calder teamed up with Edward Malt­house at Northwestern’s Medill School, Su Jung Kim, at Iowa State Uni­ver­si­ty, and Mark Van­den­bosch from the Uni­ver­si­ty of West­ern Ontario in Cana­da. The team gath­ered data on pur­chase his­to­ry as well as points accu­mu­lat­ed before the con­test and for a six-week peri­od after the con­test end­ed. This allowed them to find groups of cus­tomers who had sim­i­lar trans­ac­tion activ­i­ty before the con­test but dif­fered in whether or not they sub­mit­ted UGC. The researchers could then com­pare the behav­ior of these groups after the contest.

A Pow­er­ful Way” to Change Cus­tomer Behavior

Par­tic­i­pants respond­ed to the con­test in dif­fer­ent ways. Some left short respons­es such as blender” or dig­i­tal cam­era” to describe what they would do with the points if they won. But oth­ers wrote sev­er­al lines about why they want­ed the prize. For exam­ple, one woman wrote: have not seen my moth­er in sev­er­al years and I want to get a tick­et to vis­it her on her 80th birthday.”

These two groups of peo­ple behaved dif­fer­ent­ly after the con­test as well. 

Mem­bers who elab­o­rat­ed on their goals — mak­ing it like­ly that they thought more close­ly about how the AMRP brand relat­ed to their goals or val­ues — used their AMRP mem­ber­ship more while mak­ing future pur­chas­es. This trans­lat­ed into increased rev­enue for AMRP. The change in activ­i­ty last­ed for four to six weeks after the con­test — far longer than the effects of adver­tis­ing often last.

In fact, the few­er words par­tic­i­pants used to describe their goals, the less like­ly they were to increase their sub­se­quent use of AMRP. Mere­ly ask­ing a user to pro­duce con­tent — much like ask­ing peo­ple to like or tweet about a prod­uct — was not suf­fi­cient to ensure they were engaged. 

What we found was that the more we can get you to think about your goals and elab­o­rate on them in a social envi­ron­ment, the bet­ter a cus­tomer you become,” Malt­house says. That has the poten­tial to be a very pow­er­ful way of chang­ing cus­tomers’ behavior.”

Rethink­ing Social Media Strategy

Social media con­tests such as this one are very dif­fer­ent from tra­di­tion­al mar­ket­ing tac­tics, accord­ing to Calder.

Here, you are not try­ing to per­suade peo­ple that a brand is valu­able,” he says. Instead, you are try­ing to make an expe­ri­en­tial con­nec­tion — so the brand becomes part of the consumer’s life in a way that con­nects with per­son­al goals or val­ues that are rel­e­vant to the individual.”

For mar­keters plan­ning their social media cam­paigns, the results offer a valu­able per­spec­tive. Engage­ment — rather than sim­ply pro­mot­ing a brand — may be the key to turn­ing social media activ­i­ties into sales. When design­ing activ­i­ties or con­tests, Malt­house sug­gests that mar­keters should focus on ways to make con­sumers think about how a brand relates direct­ly to their per­son­al values. 

Clas­sic ads are aimed at per­suad­ing you that the brand will ben­e­fit you, where­as the new line of think­ing is this: In a world awash with adver­tis­ing, can we find new­er, even more pow­er­ful ways of build­ing brands?” Calder says. Our work is not just the study of yet anoth­er social media activ­i­ty, but a test of the pow­er of this new way of think­ing about marketing.” 

About the Writer

Jyoti Madhusoodanan is a Bay Area–based science writer.

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