Best Buy Co. wants to “hang out” with its customers.
The Richfield-based consumer electronics retailer recently hosted an event on Google Hangouts, an online video chat service of Google Inc., in which customers could talk with Best Buy tech experts about last-minute gift ideas. Shoppers could also buy the products being discussed.
The event, called the “Shoppable Hangout,” is just the latest attempt by a retailer to convert a large social media presence into actual sales.
“Over the past few years, we have used social media to amplify our message,” said Scott Moore, Best Buy’s senior vice president of marketing and a former chief marketing officer for Best Buy Mobile. “Now the biggest opportunity is to drive engagement — to get people to acquire products.”
In the past, retailers have used social media sites as a tool to communicate with shoppers, either to offer information or to respond to customer complaints.
But as online transactions rise and store visits decline, retailers are increasingly looking to tap Facebook, Pinterest and Twitter as platforms to drive sales — a phenomenon that’s being called “s-commerce,” short for social commerce.
For example, Target Corp. this past summer launched an ambitious back-to-school campaign called Bullseye University, in which the company live-streamed a group of YouTube personalities hanging out in a makeshift dormitory set in Los Angeles.
College-aged men and women hung out in dorm rooms outfitted with Target products and interacted with fans on Twitter and in chat rooms. Viewers could purchase merchandise by scrolling over products with a mouse.
In many ways, Bullseye University represented both the promise and limitations of such social media experiments. While Target officials were pleased with the traffic the site attracted, sales were somewhat lacking. Relatively few products were available for sale and technical issues slowed down functionality.
The biggest obstacle to s-commerce is the perception of authenticity, said Brian Kelly, a retail consultant and former executive at Sears.
The demographic likely to drive s-commerce would be millennials such as college students, who are naturally skeptical of any event that is overtly commercial.
“What’s the digital equivalent to talking over the back-yard fence to a neighbor?” Kelly said.
With the Shoppable Hangout, Moore said he hopes the presence of Best Buy’s Blue Shirts and Geek Squad agents offering informative, neutral advice on products would overcome that problem.
“What we are looking for is real authenticity,” Moore said.
Kelly said that such experiments are good ideas but that it does not necessarily mean shoppers will embrace the technology.
For example, despite retailers’ best efforts, consumers have never really adopted the use of QR codes, the images on products and signs that people scan on their smartphones for information, he said.
Gerald Storch, the former CEO of Toys R Us and former vice chairman at Target, said s-commerce is “where mobile was a couple of years ago but is quickly evolving.”
Both smartphones and tablets were first used as research tools and later became popular for making transactions. “I think [s-commerce] is inevitable,” said Storch, who now runs Storch Advisors retail consulting firm in New York.
Best Buy declined to disclose figures for Shoppable Hangout, including sales and traffic numbers, but Moore said he was pleased with the outcome.
“We will continue to press forward,” he said.