Twitter is a very hot topic in the industry today, and many retailers are experimenting with using Twitter to extend their brands, improve customer service or foster additional sales. Some retailers are rushing into using Twitter simply because it is available and quick to set up. This will not deliver the best results for the retailer, because Twitter should be part of an overall retailer social-network strategy.

• Twitter presents an opportunity for retailers to promote their brands, communicate promotional activities or improve customer service.
• Retailers that use Twitter most effectively have strategies that define what they are trying to accomplish with the social network.
• Twitter should not be used as the only element of a social-networking strategy for retailers.

• Develop a strategy to support an overall social-networking position for your business.
• Determine what you want to accomplish with Twitter before you start using the service.
• Ensure that you devote enough resources to support ongoing posts and responses.

Twitter is a microblogging service that has been in the headlines for the past few months. It has become a true social-media phenomenon. It is easy to sign up for and is easily integrated into Facebook and other social media. Twitter is probably getting more attention than is merited, given the number of people who are using the service. The latest estimates are that Twitter had approximately 4.5 million users at year-end 2008. That is certainly far short of a majority of Internet users, or even a number that merits the focus of retailers. It is also reported that Twitter is experiencing high churn rates. Despite all the buzz around Twitter, which is unlikely to diminish anytime soon, rumors abound about which company will buy Twitter. The attention alone that Twitter is getting makes it worth the effort for retailers to investigate its use.

In considering the use of Twitter, retailers should evaluate their reasons for using Twitter and plan for its use within the context of an overall social-networking strategy. The temptation is to think of Twitter as a part of a company's marketing communications strategy, but this would be incorrect. However, Twitter can be an integral part of a support program, a CRM program and other elements of the overall company strategy. Retailers that want to consider Twitter should go through the decision tree in Figure 1.

In walking through the initial decision tree, a retailer needs to assess several factors regarding whether or not to deploy Twitter:

• Audience fit —Twitter users generally are young adults, as opposed to teenagers or older adults. These users are technically savvy and active in social networks, and they want to follow changes closely as events are happening. Even if the retailer is not focusing on this audience, it needs to consider whether this audience influences its target buyers.
• Resource availability — Taking on a Twitter account requires that it be monitored on an ongoing basis. The viral nature of Twitter means that a problem can rapidly escalate to a crisis if it is not addressed quickly. The retailer needs to be prepared to devote the personnel necessary to monitor Twitter 24/7.
• Public negative comments — By deploying Twitter, the retailer may reap the benefits of the community that it develops; however, there also are risks. One dissatisfied customer can create a flood of negative comments that the retailer needs to address immediately to minimize the damage. The old adage about the speed with which bad news travels applies here.
• Quick problem response — Hand in hand with the risk of negative comments goes the need to respond to problems that do arise very quickly. This will mandate the development of policies so that retailer respondents know what to do when problems arise without having to research the issue and get approval for a response. Anticipating problems, and having a documented process to resolve them, are critical here. This can also facilitate empowerment of frontline employees to resolve problems when possible and to escalate issues where appropriate.

The next step in the process is for the retailer to determine what it is trying to accomplish with the use of Twitter. This will vary from retailer to retailer, and will depend on assessing the full strategy for social networks and community that the retailer envisions.

Determining which positioning to take has different criteria and needs to be considered in light of an overall social-media strategy (see Figure 2). Does the retailer have other social-media assets, such as a Facebook page? Is there a strong sense of community surrounding the retailer or the retailer's branded products?

Each approach to creating a Twitter feed merits differing assessments of the effort. Each approach is a valid approach, and each approach can serve a need of the retailer. However, to try to accomplish more than one approach with the same Twitter feed is a mistake, because the intent and consumer expectations are different for each approach. Here, we examine each approach and the criteria necessary to evaluate the launch of each type of Twitter feed.

This type of Twitter feed is focused on enhancing the retailer's brand among its consumer base. This can range from promoting brand values to personalizing the shopping experience by bringing personality to the retailer. This type of Twitter feed is best used to drive consumers to another social-network-branded presence for the retailer, such as a page on Facebook or MySpace. This type of feed can also be used to drive consumers to a brand-oriented page on the retailer's website. Here are the criteria that retailers should consider when considering this type of Twitter feed:

• Brand value — We have already discussed the issue of audience fit for retailers when it comes to Twitter, so that is assumed. The question remains, however, as to whether the retailer's brand is valued by the Twitter audience. Just because the Twitter user profile may fit the retailer's buyer profile does not necessarily prove that the retailer's brand is valued by these consumers. If the brand has negative or neutral associations for this audience segment, then using Twitter for brand enhancement will likely lead to disappointing results. There is some possibility that Twitter can be used as a brand builder, but there are likely better vehicles for this.
• High brand recognition — Your brand needs to have high recognition, in addition to having positive value. This ensures that the retailer's Twitter feed has potential high value for its customer base. Without high brand recognition, the retailer's efforts to enhance its brand with Twitter may fall flat.
• Brand presence on another social network — To communicate the value of a brand is tough enough without having to do it in 140 characters or less. As such, this type of Twitter feed is best used to supplement a more robust site within the social-network arena. Twitter feeds can drive consumers to another social site, such as a retailer's branded page on a social-networking site where it has more real estate to communicate the brand value proposition.
• Fluid personalized brand — Is your brand dynamic? In short, is there a lot of activity and buzz associated with the brand, or is your brand static in nature? An example of a fluid personalized brand is Zappos. Stable brands with well-established values are valuable; however, they may not lend themselves to an environment as fluid and dynamic as Twitter. If your brand is relatively static, one of the other Twitter implementations may be better for your company.

This is another approach for using Twitter. Twitter is a great way to communicate quickly and directly with your customers. If they are price-sensitive and have a high interest in your promotions and new products, this may be the correct approach for your company. These criteria should be considered:

• Price/promotion sensitivity — As mentioned, your consumers should be interested in new products and promotions for this approach to work. If your merchandise has a relatively high price stability, or if you have a fairly static product assortment, then the Twitter promotion approach is probably not the best approach for you. If, on the other hand, your merchandise assortment is fluid and you offer ongoing price promotions, then using Twitter as a promotional venue can be very successful. Dell has an established set of followers who generate significant promotional revenue for the company.
• Frequent product line changes — Do you offer seasonal merchandise to your customers? Do the manufacturers that you carry have frequent product line refreshes? If your inventory is subject to rapid change, with product life cycles that are relatively short in nature, then this may be a strong vehicle for you to communicate promotions directly to your customers.
• Short life cycle — To be clear, we do not mean perishables when referring to this category. Instead, as mentioned earlier, it refers to seasonal merchandise, such as apparel, where orders are placed several months in advance and there is little or no opportunity for restocking orders. The Twitter promotional approach may be the perfect venue to launch newly arrived seasonal product lines and to clear out the remaining inventory of the waning seasonal merchandise.
• Time-sensitive promotions — Do you run promotions that are short in nature, such as weekend specials or special of the day? If you do, Twitter can be the perfect communications channel to notify your best customers that the product line that they like is about to go on sale for one day only. You can also use the vehicle to cross-sell or upsell additional products at the same time. This can be accomplished via multiple tweets to overcome the 140-character limit. The easiest implementation is to send tweets about existing promotions.
• Viral promotions — Do your promotions have a following among your customers? If you have community features on your website, and your customers talk about the promotions that you run, then this is the Twitter approach for you. It is even better if you have a site on a social network that can present your promotions to your customers in a more detailed fashion. In that case, you can tweet to inform your customers of new information on the site and let the buzz build on the social-network site as well.

This type of Twitter feed is probably the most common. It is a direct line to customers, and near-real-time exchanges are possible with the medium. It can be used as a public support chat venue to communicate answers to questions that your customers may have. This type of Twitter feed can be very valuable in situations where you need to communicate a product recall or other urgent information. The push nature of tweets lends itself to fast, reactive responses that surface regarding the retailer or a product offering. To assess the viability of a support Twitter feed, consider these criteria:

• Product complexity — Do you sell complex products such as consumer electronics or appliances? Do these products need to be configured properly to work correctly? If so, it is likely that your customers will have many questions about the products before and after a purchase. Many of these questions, especially postpurchase questions, can make the difference between a satisfied customer and a dissatisfied customer. This direct line of communication to your customers can prove invaluable if your products are complex.
• Commodity products — Commodity is not a complete description here. The characteristic that applies here is broad-availability products that are easily comparable, such as branded consumer electronics. If the products that you sell are readily available from another retailer, the direct connection with customers via a Twitter feed can make the difference regarding where the customer ultimately decides to purchase. This does, however, put a premium on how well you execute support on your Twitter feed. Bad news travels fast on Twitter, and a failure to adequately resolve a customer issue can become a very visible problem for a retailer.
• High product support costs — It is often the case that complex products result in high support costs. The instant communication that Twitter facilitates can ameliorate support costs by addressing issues early in the cycle, before they become support problems. This can lower costs, while increasing customer satisfaction.
• High product return rates — Hand in hand with high support costs go high return rates. If the retailer can address issues with products via a Twitter feed, it may prevent a product from coming back to the store or distribution center. This could also contribute to a satisfied customer in place of a dissatisfied one. Lastly, this could prevent a community from becoming soured on a particular product offering that the retailer carries.
• Enthusiast community — Many products that are complex also have their own communities. There are Sony fans, Microsoft fans and Apple fans, as well as Thermador and Bosch fans. This enthusiast community can be a source of business by promoting products that the enthusiasts are happy with and promoting the retailers that they purchased them from. They can also be an early indicator for success of a new product that the retailer is offering. These enthusiasts are likely to be early adopters and can have undue influence on additional consumers.

The scenarios presented here do not represent the "be-all and end-all" of Twitter possibilities, but they do represent three common approaches to the use of Twitter by retailers. The criteria associated with each of these approaches are meant as a guideline for consideration when considering deployment of a Twitter feed.

Twitter presents an opportunity to retailers to promote their brands, communicate promotional activities or improve customer service. As mentioned, the retailer will need to choose which of these deployments provide the best service; trying to do all three on one Twitter feed will not be effective because of the differing objectives of each approach.

Retailers that use Twitter most effectively have a strategy in place that defines what they are trying to accomplish with Twitter. To jump into using Twitter without a comprehensive plan for the use of social media would be a mistake for a retailer and could compromise the retailer's ability to change elements of its social-media strategy in the future.

Twitter should not be used as the only element of a social-networking strategy for retailers. The 140-character limit is a substantial barrier to communicating what a retailer needs to communicate to its customers. However, when Twitter is used in conjunction with a more comprehensive medium, such as the retailer's own website and potentially a page on one or more social-network sites, the benefits can be substantial.

• Develop a strategy to support an overall social-networking position for your business. This is very important for retailers, because they need to approach social media in a comprehensive manner. Social media can be a boon for retailers, but it also has significant associated risks. Bad news travels fast in the social-network arena, so be prepared to commit the resources necessary to ensure success.
• Determine what you want to accomplish with Twitter before you start using the service. Deploying a Twitter feed without knowing what you are trying to accomplish with it can cause problems. A Twitter feed should not be a catchall communications vehicle. Instead, focus on a primary objective for the feed, and make that successful.
• Ensure that you devote enough staff resources to support ongoing posts and responses. An active enthusiast community has the potential to give almost instant momentum to a retailer Twitter feed. This can be disastrous if you are not staffed up to support the feed and be responsive to customers.