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Strategic Direction Facebook can transform your business: How one small start-up stimulates sales Article information:

To cite this document:, (2013),"Facebook can transform your businessHow one small start-up stimulates sales", Strategic Direction, Vol. 29 Iss 9 pp. 9 - 11 Permanent link to this document:http://dx.doi.org/10.1108/SD-08-2013-0050 Downloaded on: 22 February 2017, At: 19:34 (PT) References: this document contains references to 1 other documents.

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(2012),"Can Facebook be an effective mechanism for generating growth and value in small businesses?", Journal of Systems andInformation Technology, Vol. 14 Iss 2 pp. 131-141 http://dx.doi.org/10.1108/13287261211232153 (2013),"Optimal ways for companies to use Facebook as a marketing channel", Journal of Information, Communication and Ethics inSociety, Vol. 11 Iss 2 pp. 112-126 http://dx.doi.org/10.1108/JICES-12-2012-0024 Access to this document was granted through an Emerald subscription provided by emerald-srm:485088 [] For Authors If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information abouthow to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information.

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*Related content and download information correct at time of download.Downloaded by University Library At 19:34 22 February 2017 (PT) Facebook can transform your business How one small start-up stimulates sales I t must be the dream of every company leader – and every marketing executive – to nd something that will allow them to double sales quickly and cheaply. And if using that tool gets the business closer to its customers, understanding their needs and engaging them in a two-way conversation, well, so much the better. Online social networks (OSN’s) may be the answer – and for one small company, the decision to use social media has transformed their situation. How the Sleep Store started When husband-and-wife team Louise Tanguay and Matt Anderson discovered a book with techniques to calm their rst child’s crying and help him to sleep through the night, they also found the inspiration to start a new company. Run from the family home in Auckland, New Zealand with the help of two part-time staff, The Sleep Store was started in 2006 as a family-owned, online-only business. Their web site www.thesleepstore.co.nz caters for children from birth to about six years old and offers baby sleep solutions and products from around the world, many of them not available anywhere else in the country.

Most of The Sleep Store’s customers are in New Zealand or in Australia, where ve times as many babies are born each year. With sales in Australia running at under a third of the New Zealand level, the company had particular ambitions to boost sales there. At rst they used a purchased e-mail database as their main marketing tool, but in 2010 the partners had the idea of using online social media to communicate with their customers.

Experimenting with social media Online social networks are Internet sites that host and support a network of user pro les and relationships, allowing registered users to create and share content or to engage in discussions. Social media have become an everyday component of their users’ lives, helping them to keep in touch with friends, or connect with people who have common interests.

Since the rst OSN was launched in 1997, networks such as Facebook and Twitter have grown at a remarkable rate. By 2010 Australians were spending an average of seven hours a month using social media – well above the global average – and almost half the population was spending time on at least one social networking site. If new mothers who were alone at home with their baby could use social media to communicate with others in the same situation, it seemed highly likely that they would welcome an opportunity to reduce their feelings of isolation. DOI 10.1108/SD-08-2013-0050 VOL. 29 NO. 9 2013, pp. 9-11,QEmerald Group Publishing Limited, ISSN 0258-0543 jSTRATEGIC DIRECTION jPAGE 9Downloaded by University Library At 19:34 22 February 2017 (PT) So The Sleep Store experimented with this new approach, selecting Facebook in preference to Twitter because it offered a more in-depth media experience. They reasoned that posting articles and photos or videos on Facebook and using it to host discussions, quizzes and competitions was a way to drive traf c to their web site. It also had the advantages of being:

B cheap and quick to set up; B free to use; and B needing no specialist web skills, as there are templates for inserting different sorts of content.

Using natural social networks is a highly effective mechanism for driving awareness and creating interest. Individuals share a surprising amount of personal and demographic information in their online pro le and many big brands such as Coca-Cola and Starbucks actively attract millions of online followers. What makes it particularly valuable to companies is that if a user decides to ‘‘like’’ a particular organization’s Facebook page, their entire network of Facebook friends can then automatically see this on their own wall. If those friends also ‘‘like’’ that Facebook page, then the endorsement can grow exponentially. Setting up an additional sales and marketing channel To begin with, The Sleep Store Facebook page just gave general information about the company and their product range. It took just a day to set up, but quickly grew as an online community for new mothers. Members started to use the platform to support each other and offer their own experience and advice – and The Sleep Store team, all parents themselves, added their suggestions and sleep advice, joined in the conversation.

To promote their new Facebook page The Sleep Store did a number of things:

B wrote an article in their bimonthly e-mail newsletter; B launched a competition where the rst 500 members to ‘‘like’’ the Facebook page were entered in a prize draw; B put an advertising banner for the Facebook page on the web site homepage; and B added it to their printed stationery and all staff e-mail signatures.

A year after launching and without changing anything else, The Sleep Store found that: B their new Facebook page had almost 10,000 ‘‘likes’’; B gross sales doubled; and B they needed three new members of staff to cope with the increase in orders.

Louise now spends about half her working day on Facebook, updating content, writing responses and prompting discussions with open ended questions. She believes that spending more time on Facebook would help the company grow even more. Sleep Store staff consider that the Facebook page helps them: B communicate with customers more effectively; and B determine customers’ needs and expectations.

They also use one-day Facebook-only spot sales to clear end of season stock at reduced prices – a very effective way to clear storage space for new products. As customers seem to ‘‘ Social media have become an everyday component of their users’ lives ’’ PAGE 10 jSTRATEGIC DIRECTION jVOL. 29 NO. 9 2013Downloaded by University Library At 19:34 22 February 2017 (PT) prefer posting comments on the Facebook wall instead of sending private e-mails, this lets other users comment and also saves staff time responding to individual messages.

Success depends on customer response This small business found that adopting Facebook:

B increased turnover, new customers and organizational growth; B brought valuable new insights into customer needs and which products worked best; B and generated positive word-of-mouth recommendations through the in uence of Facebook community members.

But a word of warning: not all small businesses can expect such impressive results from adopting Facebook. The nature of the business and of their customer base were key factors here. Mothers at home alone after having a baby found somewhere to exchange information and get emotional support, sometimes forming form close friendships in this virtual community. It will be interesting to see in future research how other, different small businesses and start-ups use online social networks and the success or otherwise that they have with this approach. Comment This review is of ‘‘Can Facebook be an effective mechanism for generating growth and value in small businesses?’’, by John L. Hopkins. Based on the experience of The Sleep Store, a family-owned, internet-only business in New Zealand, the answer would appear to be a resounding ‘‘Yes!’’. However, authors of this case study advise caution, recommending further research into this fascinating area to evaluate whether other small companies with a different customer pro le would nd social media useful as a way to grow their business.

Keywords:

Facebook, Social media, Small business, New Zealand, Australia, The Sleep Store, Children, Marketing communications, Social isolation Reference Hopkins, J.L. (2012), ‘ ‘Can Facebook be an effective mechanism for generating growth and value in small businesses?’’, Journal of Systems and Information Technology , Vol. 14 No. 2, pp. 131-141. ‘‘By 2010 Australians were spending an average of seven hours a month using social media ’’ VOL. 29 NO. 9 2013 jSTRATEGIC DIRECTION jPAGE 11 To purchase reprints of this article please e-mail: [email protected] Or visit our web site for further details: www.emeraldinsight.com/reprintsDownloaded by University Library At 19:34 22 February 2017 (PT) This article has been cited by:

1.Jurry Hatammimi, Osa Omar SharifSelection the way to start business based on social media features 371-376. [ CrossRef ] Downloaded by University Library At 19:34 22 February 2017 (PT)