Thanks to mobile and social media, there’s been a shift in the roles of retailer and consumer. Consumers used to walk into a store – unaware of the subtly placed ads surrounding them – and buy whatever they came there to buy… and then some. They were just that oblivious to the retailer’s tactics.

But times have changed. Stores can no longer outsmart the consumer, unless the consumer lets them. So how do retailers deal with the ongoing changes in social media and mobile technology? This is hard to determine. Some stores choose not to get involved too much in social networks, This is because they can’t control how consumers will react; people might have misperceptions or just want to discredit a brand by using the social media platform. Other consumers could go public with their complaints and put the company in an unpleasant situation that requires immediate attention, whether that be a prepared statement or public response. Moreover, time is crucial in online real-time customer service; companies don’t wish to be held accountable for inappropriate responding.

Here’s an example of how social media could affect a company’s reputation:
Musician Dave Carroll flew with United Airlines and when he landed, he found out that his guitar was broken. He went back and forth for approximately nine months to get United to take responsibility: they refused. He posted his experience on his website and he wrote songs called “United Breaks Guitar Trilogy,” and posted the music videos on YouTube. These videos have received more than 10 million views each. David Carroll’s experience has reportedly cost United Airlines $180 million. Social media is defined by its users, not the companies; companies need to react rather than trying to control social engagement.

Purchase Decisions
Consumers are very likely to base purchase decisions on brand recommendations from their friends. This is what embodies the power of social media and retailers need to recognize this. Contrary to the risks of engaging in social media, the opportunities outweigh the negatives by so much more. Many companies struggle to develop a rewarding strategy, but some succeed. Those who acknowledge the generation of “Smart Buyers” are heading in the right direction. Consumers use their smartphones when searching for store locations, price matches and brand information. This mobile access allows them to make “smarter” decisions on how they spend their money. Retailers need to recognize these consumers have already decided to buy, and take this into consideration when developing a strategy.

Combining Online and Offline Engagement
The trick for retailers is to use online experiences to direct people to the store that carries their product. If people are pleased with the online communication of a brand, they’ll notice the brand sooner in the store than they did prior to online brand engagement. And this works both ways: if consumers experience positive interactions with a store employee, this experience will lead them into online engagement, for example, by ‘Liking’ the brand on Facebook or becoming a ‘follower’ on Twitter. It’s best if retailers that don’t want to take big risks start at this core element of social branding and learn what works for them.

Mobile and social media will only develop more in the coming years, which means that changes and role-shifts cannot be avoided nor determined. Retailers need to offer substantial value to their customers and build customer relationships. It’s not an easy task, but if done correctly, a future term in social marketing will be “Smart Retailers.”