Twitter Enters E-Commerce Fray
Twitter has appointed its first head of commerce, Nathan Hubbard, as it begins an e-commerce initiative. Details are sparse on how Twitter will facilitate retail in 140 characters or less.
Hubbard, the former president of Ticketmaster, said only that “We’re going to go to people who have stuff to sell and help them use Twitter to sell it more effectively," in an statement to Business of Fashion. The article goes on to say that Hubbard will seek partnerships with retailers and payment services companies, rather than entering head-to-head competition. The move is intended to raise additional revenue as Twitter looks to an IPO in the months ahead.
How's Social Media Working Out for Retail?
Twitter's foray into social media comes at a time when social media is not working as well hoped for retailers.
Although some business sectors are taking a second look at Twitter for business marketing, a study of prestige retailers the digital consultancy L2 found that over the past four years, less than 0.25% of new customers have been acquired through Facebook and less than .01% from Twitter. In addition, the research disclosed that customers gained via social media spend less than other customers.
A number of retailers opened up Facebook stores to great fanfare in 2011. With the exception of Tory Burch, most are now closed, including: Oscar de la Renta. the Gap, J.C. Penney, Nordstrom, GameStop.
It would appear that the strategy that works best on social media is word of mouth. When someone hears from a friend or other trusted source that something works, they're more likely to go with it. Pinterest has provided a great example of this type of personal "show and tell." Brands may be finding that what works best is to make it easier for people to find and order items that they see and hear about from their own networks.