How Retailers Can Leverage UGC to Acquire Millennials
Millennials are one of if not the most sought after customer demographics for retail brands. The largest generation in the world — 80 million strong in the U.S. alone — are forecast to spend $200 billion annually by 2017, and $10 trillion over their lifetimes as consumers. And that’s just in the U.S. You can see why retailers are investing significant time and money trying to capture these valuable customers.
Increasingly, retailers are leveraging social media and user generated content (UGC) to better connect with millennials, who are skeptical of traditional media for product and brand information. In the following interview with Total Retail, Rory Dennis, chief marketing officer of Amplience, a SaaS-based platform that enables retailers to produce digital campaign and product media, discusses the growing trend of UGC and how brands can best leverage this content source, particularly for acquiring younger customers.
Total Retail: Why is UGC valuable for retailers?
Rory Dennis: User-generated content is valuable to retailers because of the increasing importance of social media in today’s society, especially among younger generations. Social media use is growing at a record pace, with almost half of today’s consumers (43 percent) using social media to make a purchase decision. The content created and shared across these channels presents a great opportunity for retailers to tap into conversations and effectively cater to users’ demands and interests.
By doing this, they can create a more authentic and engaging shopping experience that enhances customer loyalty and credibility among shoppers. Simply put, people are influenced by other people. Therefore, using relevant posts from other social media users helps generate interest in the retailer, therefore boosting sales.
TR: What are the types of UGC that retailers are collecting?
RD: UGC comes in many shapes and sizes, enabling each retailer to use whatever form best benefits their brand. UGC can be a simple blog post, a product review, user-submitted images and videos, etc. With the increase of social media use, retailers have unlimited access to customers’ positive feedback on their products and/or brand, making it more important than ever for them to capitalize on these key third-party testimonials.
TR: How can retailers leverage UGC as a tool in the purchase journey?
RD: User-generated content can be leveraged in many ways to influence purchases. For example, retailers can collect social and user-generated content from Instagram and other social channels, tag the products that are featured and then republish to their websites so that users can see what products are featured. Similarly, retailers can create collaborative media galleries on their sites. These centers of UGC then help foster interaction and drive conversations throughout the customer journey.
Connecting with social media users gives brands more opportunities to attract a larger audience of prospective buyers, as social media posts have a way of spreading. Additionally, sharing a photo from a customer can help drive sales because the brand and product has been vetted by a “public” figure. Social media is becoming increasingly important for buyers, with a large number of them crediting the channel for their purchasing choices. Brands will stand out more when they engage with their customers; utilizing user-generated content to do that encourages brand loyalty, in turn driving sales.
TR: Why is UGC particularly important for brands selling to a younger demographic?
RD: As the younger generations become key targets for retailers, engaging with them via social media will be a critical step to staying relevant. Younger buyers are glued to their smartphones, constantly surfing the internet and social media, and generating huge amounts of content that’s being shared across channels. Engaging with these young buyers through UGC is increasingly important now because brand loyalty is harder to come by in this digital era.
With the vast variety of online shops, the younger demographic knows that with just a click of a button they can find the same product on another website. Therefore, companies need to interact with their customers in new and engaging ways to instill a sense of customer loyalty, and utilizing UGC to show how their peers are using the products is a great way to start.
TR: Do you have any tips for how retailers can implement UGC into their websites and marketing efforts?
RD: Retailers can implement UGC into their websites in a number of ways. For example, incorporating a social wall on the site would encourage social media users to tag a brand’s products and give them the chance to be featured on their favorite store’s website through a photo or video. In turn, this allows other prospective buyers visiting the site to see how their peers are styling an outfit, inspiring them in their use of the product.
Incorporating UGC in a customer competition is also a smart marketing strategy. Using social media for a company competition encourages customers to show off their creative sides and provides a setting for the retailer and customer to have a two-way conversation. There are many other creative ways to integrate UGC into websites and marketing efforts. We’re still in the early stages of seeing brands incorporate UGC into their websites, but the possibilities are numerous!