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Shop 'til you click: Retailers turn to social shopping

Maria Gioulos, of Hicksville, shops at Walmart in

Maria Gioulos, of Hicksville, shops at Walmart in East Meadow on Oct. 23, 2015. Credit: Jeremy Bales

Major retailers are giving shoppers on Long Island and nationwide more options during the expanded holiday shopping season, including shopping on social media apps.

It's an important part of retailers' efforts to provide a shopping experience that is faster and more convenient, retailers and industry experts say. The holiday season represents about 19 percent of the retail industry's annual sales. For some retailers, such as jewelry and department stores, the holidays can generate as much as 30 percent of annual sales.

And then there's the new phenomenon of social shopping. Retailers are embracing social media, such as Facebook, Pinterest, Instagram, Twitter and YouTube, to sell directly to customers with "buy" or "shop now" buttons that allow users to browse and in some cases purchase products directly through the sites.

The new technology means shoppers can quickly glance through the product offerings. As a bonus, customers sometimes pick up products they bought online from brick-and-mortar stores -- providing opportunities for more purchases.

"Retail is trying to figure out how to change the dynamic to engage the consumers earlier and more often, and how to drive people into stores," said Marshal Cohen, chief industry analyst for Port Washington-based market research firm NPD Group.

Total holiday sales in November and December are projected to increase by 3.7 percent to $630.5 billion, with online sales rising 6 to 8 percent to as much as $105 billion, according to the National Retail Federation.

Shopping for Christmas, Hanukkah and Kwanzaa is starting even earlier than in the past. This year, about 40 percent of holiday shoppers in a survey by the NRF said they would begin their buying before Halloween. Another 41.5 percent said they would start in November, and 18.7 percent said they would launch in December.

The trend away from purchasing gifts later in the season is being driven, in part, by retailers that offer deep discounts starting in November that are similar to those on Black Friday and Cyber Monday.

Still, the biggest shopping days are likely to be Black Friday (Nov. 27), Super Saturday (Dec. 19) and the day after Christmas (Dec. 26), according to analytics firm ShopperTrak. This year, Hanukkah begins 10 days earlier than last year, running from Sunday, Dec. 6, at sundown through Monday, Dec. 14, and adding to the post-Thanksgiving rush.

'Shopping moments'

Online shopping, using social media and mobile devices as well as computers, will play a bigger role. About 85 percent of shoppers are predicted to research prices online and then buy in-store, up considerably from 54 percent the prior year, according to Chicago-based research firm Market Track.

"People are looking at their phones at an average of 150 times a day," said Danielle Conte, founder of Centerport consultancy Youtail Retail. "When people are looking at their phones so much they are really looking and searching. Shopping moments will replace shopping marathons."

Last week, Christin Mullen, 30, of Bedford-Stuyvesant, Brooklyn, said he spotted a $60 shirt he was interested in buying for himself at the Gap store in the Roosevelt Field mall. Mullen pulled out his smartphone and found the same shirt on the Gap website for 50 percent off. He then decided to order the shirt online, he said.

"I normally don't plan ahead, but this year I am planning ahead," said Mullen, who will start gift shopping in early November to spread out his budget and avoid the crowds.

Driven by social media

This holiday season, in-store traffic will not necessarily dwindle despite the migration of more customer traffic online. About 94 percent of Americans plan to shop in stores and 92 percent online, with 94 percent of consumers likely to make purchases from a computer and 49 percent making purchases from a mobile device, according to global technology company Pitney Bowes.

"It is the same person using different types of online access at different times of the day," said Christoph Stehmann, chief operating officer for digital commerce solutions for Pitney Bowes, based in Stamford, Connecticut. "In today's world, consumers look at marketplaces, retailers' websites and use search engines. It is the basic convenience that drives them online."

The goal is to increase retail sales and referral traffic through social media, a strategy that last year generated $3.3 billion from social shopping for the top 500 retailers, up 26 percent from 2013, according to the Social Media 500 report put out by Internet Retailer, a magazine based in Chicago.

"Long Islanders are sophisticated shoppers and sophisticated online users," Cohen said. "We are certainly using social media."

This year, Pinterest introduced a way for people to buy certain products directly from its site, while Twitter allows people to purchase items from some tweets. YouTube uses annotations to give retailers a way to direct consumers from its videos to shop for products on its website.

Weeks ago, Facebook began testing a feature called Canvas, which allows a user who clicks on an ad to surf a retailer's catalog before going to the retailer's website to purchase. The feature, which is being used by Target and a few other retailers, is intended to help consumers browse items faster.

"We are testing a new way to make the shopping experience a lot faster, kind of like instant articles," Facebook spokeswoman Elisabeth Diana said. She said the company anticipates a full rollout of Canvas next year.

"A lot of retailers find that when we try to get people to go to their website, the load times are slow and people drop off," Diana said. "So we are trying to speed up that process."

Generally, social media companies collect advertising revenue, but do not take a cut of any sales generated from people clicking and browsing on the platforms and then buying on a retailer's site.

Target is testing Facebook's Canvas ads on mobile phones.

"We really want to be a mobile-first retailer," Target spokesman Eddie Baeb said. "It is about making things easier for consumers."

Mobile deals via Facebook

Separately, Facebook announced in September a dedicated shopping section on its mobile app. In the section, retailers can choose to link to their own retail websites, or they can test a way for people to buy directly on their Facebook pages.

At Toys R Us, "We leverage our social media platforms to engage with consumers across all of our channels," spokeswoman Alyssa Peera said.

The retailer uses Facebook and Twitter to link customers directly to product pages on its website, and is exploring using Instagram and Snapchat.

Last year, Facebook introduced the "buy" button in ads in News Feed that lets people on desktop or mobile complete purchases on the social network itself. It also introduced the carousel format for Facebook and Instagram ads, which lets advertisers showcase multiple product images and links in one ad.

"If I saw a picture with the link, I would click on it," Maria Gioulos, 17, of Hicksville, said as she shopped at Walmart in East Meadow.

Retailers are also promoting user-generated content such as customers' "selfies" with products, which can influence other purchasers, and allow retailers to sustain relationships with their socially active clientele.

"Customers buy a product and hashtag it," said Al Lalani, chief executive of Social Annex, a social commerce and customer loyalty software company based in Los Angeles. "We then have the ability to source these pieces of content that is organically being shared by customers. Instead of seeing a stock photo, you see real people using that product."

Shipping incentives

Among those who shop online, 93.1 percent say they will use a free shipping offer for holiday merchandise, and 46.5 percent say they will pick up in store or have items shipped to the store, NRF found.

In October, Best Buy announced it will offer free shipping on all orders until Jan. 2, instead of its usual $35 minimum-purchase threshold. In September, Toys R Us and Babies R Us lowered the free shipping minimum for online orders from $49 to $19. Target is offering free shipping on all orders through Dec. 25.

Consumers like Tiniqua James, 39, of Hempstead, are willing to do what it takes to qualify for free shipping.

"Free shipping is the No. 1 thing I look for," James said as she shopped at the Walmart in East Meadow for her daughter Erykah, 6.

Another way retailers try to keep customers going into stores is to provide deals before the Thanksgiving weekend. Best Buy is touting "Black Friday-like deals" in 400 stores on Nov. 7.

Starting Nov. 1, Walmart offers "rollbacks" with discounted prices that will last through the season, and deals such as a 16-gigabyte iPad mini 2 with Wi-Fi for $199. The device normally retails for $268.

"We don't want our customers to second-guess our prices," Walmart spokeswoman Jaeme Laczkowski said, adding the retailer forecasts it will get more than 200 million visits on its Walmart app during the holiday season. "They can be confident that it will be the lowest price for the season."


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