This is a homework assignment for my Marketing 5000 class at Webster University. It has not been graded yet.
Carolyn Hasenfratz Winkelmann
Dr. John Jinkner
6 April 2020
Article Review #1: – E-Marketing, Digital Media and Social Networking
Name of the Article: “How Social Media Communications Combine with Customer Loyalty Management to Boost Green Retail Sales”
Source: Journal of Interactive Marketing
Authors Lu and Miller examined how loyalty rewards programs (LRP) combined with customer relationship management (CRM) and social media campaigns could increase sales of “green” products in a retail setting. Concentrating on grocers who sell foods that are marketed as organic, healthy and sustainable, the article explains that while the demand for “green” foods is growing, there are barriers to the acceptance of these products among some consumers (Lu and Miller, 87-88). Some potential customers hold the perception that environmentally sustainable foods are too expensive, aren’t adequate substitutes for conventional products and are not worth the extra cost. With additional knowledge about the value of such products, some consumers can be persuaded to give them a chance and be converted to motivated buyers (Lu and Miller, 88).
Because Facebook was the most dominant social media platform in the world at the time of the study, the authors used it to examine the relationship between Facebook content and sales among “green” grocery retailers in a large city in Australia. Facebook is a platform that marketers can use to practice social customer relationship management (SCRM), an updated form of customer relationship management (CRM) that adds social media into the marketing mix (Lu and Miller, 89). Intuition and previous studies showed the authors that effective content on Facebook should increase sales. Their study focused on participants in loyalty rewards programs which are proven to increase profitability if used effectively (Lu and Miller, 90).
Social media gives consumers more control over marketing because they can create and share content rather than just consuming content that is pushed to them by the brand (Lu and Miller, 89). Both brand-generated and consumer-generated content can increase the level of interest and engagement with a brand, which has a positive influence on actual shopping activity (Lu and Miller, 89, 91). “Green” products do often require more knowledge on the part of the consumer to realize the value and to stimulate a purchase (Lu and Miller, 91). Many “green” consumers organize themselves into social media-based communities that share common values and exchange information (Lu and Miller, 91). Consumers need to be motivated to effectively consume information presented by a brand (Lu and Miller, 92). It makes sense to leverage the power of social media along with the heightened brand engagement exhibited by long-term loyalty reward program participants (Lu and Miller, 92) to increase the acceptance of environmentally responsible products. Lu and Miller found that thoughtful SCRM strategies did increase the sales of “green” products to long-term LRP members (Lu and Miller, 97) and that these loyal customers responded more to messages about the health benefits of sustainable products than they did about the environmental benefits or the price (Lu and Miller, 98).
How this Article Relates to our Course
In Chapter 1 of our textbook, “Marketing”, we are reminded that environmental factors that influence marketing can change quickly (Pride and Ferrell, 13). As we are now suddenly dealing with a global health issue that has severe effects on many aspects of life, one way consumer needs have changed rapidly is that we need supplies to protect ourselves from infection. Health, physical and mental, is at the top of nearly everyone’s concerns right now. I work in a store that has a loyalty rewards program, engages in social media marketing, and sells some environmentally conscious products, considerations which made the article I reviewed of particular interest. We also sell supplies, some in stock intermittently, that customers want and need to cope with the pandemic. I’m observing and participating in real time how to change course rapidly as we respond to consumer demand as well as reading about it in our textbook.
Perhaps some might assume that such an event in history is a time for mere coping, not marketing. Marketing concept is a philosophy that an organization adopts when it takes into account not only the needs of customers but the welfare of all the stakeholders that it has an effect upon (Pride and Ferrell, 13-14). Customers of the store are stakeholders, as well as are owners, employees, vendors, service providers, delivery people, the families of all those groups and the community as a whole. Profiting by satisfying customer demand at the expense of other stakeholders was already frowned upon by many as a business practice before the current challenges we are facing (Pride and Ferrell, 14). Brand managers would be wise to be wary of being perceived as exploiting a crisis. For example, businesses that inflate the prices of crucial items or make false claims about the usefulness of products have been reported by name in an article published by the St. Louis Post Dispatch (Stewart).
The article I reviewed is enlightening when considering how marketing concept applies to serving the community in the present time. Since long-term loyalty rewards program customers are the most profitable customer category for a retailer (Lu and Miller, 92), it is less than rational to reap short-term gains at the risk of offending long-term loyal customers with behavior that is not community-minded. I hypothesize that a brand that already takes into account all stakeholders and has effectively imbued its organization with the philosophy behind its marketing concept is at low risk for carelessly implementing an action that will backfire because the first instincts of individuals within the organization will be to serve rather than exploit. Now is not a time to cease marketing but to use actions as marketing while serving all stakeholders with a view to their long-term health and welfare, fiscal and otherwise.
Lu, Qiang Steven, and Rohan Miller. “How Social Media Communications Combine with Customer Loyalty Management to Boost Green Retail Sales.” Journal of Interactive Marketing, vol. 46, May 2019, pp. 87–100. EBSCOhost, doi:10.1016/j.intmar.2018.12.005. Accessed 06 April 2020.
Pride, William M. and O.C. Ferrell. Marketing. 2018 Edition. CENGAGE Learning, 2016, 2018.
Stewart, Tynan. “Overpriced toilet paper, $12 masks: Missourians complain about coronavirus price-gouging.” Stltoday.com, 2020, www.stltoday.com/news/local/govt-and-politics/overpriced-toilet-paper-12-masks-missourians-complain-about-coronavirus-price-gouging/article_4bedcd86-c828-5be2-9f03-c3e010ef820c.html. Accessed 6 April 2020.