China Market Research ...'s  Instablog

This commentary originally appeared in IMEDIA Asia.

www.imediaconnection.com/content/23201.asp

By Ben Cavender and Meredith Sun

In today's financial crisis where marketing budgets are stretched farther than ever, companies must take advantage of Twitter's popularity to trigger sales and position their brands.

Once the battle between Ashton Kutcher of Punk'd fame and Larry "do you punch little buttons and things" King gained momentum, EA Sports decided to get in on the game, offering the millionth user to follower Kutcher a free copy of every 2009 EA Sports title as well as a part in the upcoming Sims 3 release provided that Kutcher won. EA's venture was a creative and low cost campaign that spread virally through the internet. It also took advantage of the fact that many of Twitter's original users were younger netizens that would make up EA's core target market. Instead of wasting money on expensive advertising campaigns, EA spent its money where their target audience spends their time and re-thought the traditional marketing budget allocation mix.

Showing that Twitter is popular not just on America's shores, China's leading online travel site Ctrip.com has its very own Twitter feed, ctripenglish, which it uses to keep followers apprised of travel deals offered via its website. With loyal customers spending more per purchase than new customers, brands need to try to up-sell to consumers and create more brand loyalty. It will generate more revenue and cost less than prospecting for new customers, which is difficult in a time when consumers are hunkering down and spending more on brands and products that they know and trust.

Ctrip also launches weekly contests including a recent one in which they offered a long weekend at Shanghai's Portman Ritz-Carlton. Ctrip asked contestants to tweet responses to the following question "If we gave you 1,000 RMB to spend, what would you do to show the world your appreciation to the Ritz Carlton for your amazing free stay?" This is a low cost but effective way to create excitement and position Ctrip as a provider of luxurious and aspiration travel. 

Twitter is not just for large companies with millions of customers. Small companies can also take advantage of its powerful tools. Take for instance Steep and Cheap which sells lots of outdoor gear one item at a time. Every time Steep and Cheap sells out an item and begins offering a new one, they post a new tweet linking to their webpage. Other examples include a bakery in London that twitters when fresh bread is on offer. 

Ironically, Twitter also gives companies a chance to interact with their customers on a more human level. Whole Foods Market for example posts tips on how to be more environmentally friendly and JetBlue uses Twitter as another means of responding to customer service questions. Today's consumers want to connect with brands that they like and want real interaction, not just to be bombarded with one-way TV and newspaper campaigns. This makes them feel special and wanted.

Twitter also allows companies to quickly gain input from their customers as well as manage inventory and offer targeted promotions. As tweeting becomes a more established verb for humans we are going to see a lot more companies using micro blogging as a straightforward way to reach customers. 

In a challenging economy with fierce competition moving outside of traditional advertising and incorporating services like Twitter can be a low cost way to improve marketing efficiency. Companies should consider how they can incorporate it into the mix.

Ben Cavender is a senior analyst, Shaun Rein, www.cmrconsulting.com.cn/about/shaun_rein.html a managing director, and Meredith Sun an analyst with The China Market Research Group (CMR) www.cmrconsulting.com.cn.