Introduction

This case study draws attention to the issues surrounding social media marketing management of the Luxury

Food Store, which is an SME grocery retailer. Major social media platforms include Facebook, Twitter,

Instagram, Pinterest and YouTube. The main advantage of using social media is that it allows SMEs to

promote their business to an unlimited market. Social media has been defined by Kaplan and Haenlein (2010)

as "a group of Internet-based applications that build on the ideological and technological foundations of Web

2.0 and that allows the creation and exchange of User Generated Content".

Click and Brick: The Emerging Multi-Channel Retail Environment

Grocery retailing is an inherently fast-moving, dynamic and intensely competitive industry sector. Major

competitive rivals in the sector include Tesco, Sainsbury's and ASDA (Wal-Mart). These retailers base their

business models upon distribution efficiencies and the power of bulk buying, with the resultant marketing

campaigns focusing on low price. With this in mind, relatively new entrant 'discount retailers' such as Lidl and

Aldi have intensified this competitive dynamic.

Large grocery retailers have often been criticised for their lack of support for local produce, as evidence by

the global sourcing of products, the price offered to farmers for products and short-term supply relationships.

In order to differentiate, smaller grocery retailers such as Luxury Food Stop have shifted away from this low

price value proposition. Luxury Food Stop has chosen organic, luxury and local produce as core associations

to its brand. In order to provide local fresh produce, the focus is on longer-term supplier relationships with

producers. Farmers are given more favourable supply arrangements than would be offered by the large

supermarket.

These goods are then presented in store as fresh, organic and colloquial. Specifically, customers are provided

with a more ambient shopping experience than larger grocery competitors in a unique "market" style retail

environment. The management of the firm believes that its customers value the company's support for local

producers and it therefore communicates this throughout the store and on packaging. Typically products are

merchandised in a way that tells a story, that is, what makes the product special; who makes the product;

and how Luxury Food Stop facilitates local producers in making the product. Since the business wants to

remain relatively price competitive their mark-up is 30%. This is relatively lower than in large retailers whooften charge price premium for organic goods, and the mark-up can be anything up to 60% over non-organic

goods, as La Via and Nucifora (2002) report.

Despite the green shoots of recovery over recent years and declining unemployment, grocery retailers are

still experiencing the realities of a changed retail sector. This constantly challenges small to medium-sized

enterprises (SMEs) to satisfy the needs and requirements of their customers, within the constraints of tight

budgets. In particular, SME retailers wish to create a pleasant shopping experience for their prospective

customers through the various marketing channels available to them. Their choices range from rotating

special offers, promoting new lines and keeping attractive product displays. Maintaining these channels is a

heavy and time-consuming workload for SME retailers, often putting them under great pressure to succeed.

This pressure is heightened by the popularity and demand for digital technology, equipment and gadgets.

Indeed, Web 2.0, whilst supplementing the marketing channels available to business owners, has also added

an extra dimension with which the marketing manager must cope. Retailers in particular have been able to

capitalise on the convergence of the physical and virtual environments. Large retailers such as Argos have

been rejuvenated by their warm embrace of Web 2.0 tools, such as social media, to introduce service, sales

and communication into their contemporary "multi-channel" strategies.

What is more, it is essential that present-day retailers keep well up to date and even ahead of these trends,

through digital marketing channels. The various options available to forward-looking SME retailers wishing to

promote their company in this new digital medium constantly open new and exciting doors to reach customers

with limitless opportunities.

The digital avenues readily accessible to ambitious SME marketing managers can be successfully tailored to

individual company needs. Typical issues and challenges faced by SMEs trying to use social media include

the following: time management, knowledge and expertise, available staff and management support.

For example, incorporating Web 2.0 features into the design of an organisation's website can help the site

to become a powerful sales medium for the firm. Businesses such as Luxury Food Stop can attempt to

monetise social media through targeted competitions and promotions on their social media platforms. This

could provide a mechanism for direct online referrals to the core website. It is essential that SME retailers

design their main website to be informative and easy to navigate, including accessible links that refer to

relevant social media pages. This enables retailers to actively communicate, sell and provide services to their

customers, thus maintaining a personal customer relationship.

Company Background

Luxury Food Stop is an award-winning independent grocery business located in a prime town centre

situation, in a busy market town in Northern Ireland. This third generation, family-owned business, established

back in the 1800s, has prospered and grown, now providing employment for over 100 staff. According to

the European Union definition of SMEs, Luxury Food Stop can be categorised as a medium-sized firm.

However, it must be acknowledged that in the retail sector many medium-sized firms demonstrate smaller-firm

behaviours due to the contribution of part-time employees to their workforce, a behaviour described by Omar

and Fraser (2011). The company's brand is all about offering high quality fresh foods, actively supporting local

farmers and producers and maintaining a colloquial relationship with its customers.

As a customer enters the store, great care is taken by friendly and helpful staff to give them a warm welcome

and to greet them with attractive and eye-catching displays of fresh produce. This enticing environment

encourages Luxury Food Stop's shoppers to pause and fill their baskets with first-class groceries. This helps

to turn a tedious chore into an enjoyable and traditional "market feel" experience.

Social Media Marketing in Luxury Food Stop

To date, this grocery store's main approach to sales has been based on traditional retail marketing principles,

for example, retail atmospherics, customer service and stock merchandising. External marketing

communications have been traditionally based upon newspaper advertisements.Two years ago Luxury Food Stop implemented social media as part of their marketing strategy. They have

used three social media platforms, namely Facebook, Twitter and Instagram. Currently, their Facebook

platform has received 1,268 page "likes" and 20 posts were created by Luxury Food Stop within the month

of October 2014. Their Twitter account has 27 followers with two tweets and their Instagram account has 13

followers and five posts. It is clearly evident that Facebook has proved to be the most active and engaging

means of social media for this grocery retailer. This has received a low level of engagement from customers

due to a lack of proactive postings and a lack of knowledge by Luxury Food Stop themselves.

Although, the marketing manager has been encouraged by this positive response to the activity on social

media, the interaction with customers has not grown or progressed as first anticipated, and this has caused

the marketing manager to concentrate on Facebook and neglect Twitter and Instagram. An attitude of

disinterest regarding the regular upkeep of Twitter and Instagram, both of which were last updated a year ago,

creates a negative rather than a positive impact amongst their customers. The company has lost followers on

Twitter and visits to their Instagram page have fallen.

According to the marketing manager of Luxury Food Stop, the company is not willing to close these two

unproductive channels at the present time. The company prefers to keep its options open, as it is a free and

available platform involving little or no cost. In fact, the marketing manager confirmed this by stating, "We are

keeping our options open and the posts we do put up do not cost us very much and so why not open other

social media accounts?"

This source of marketing still remains unimportant and too time consuming in their opinion. The company

doesn't really know how to capitalise on its social media presence. Therefore, very little time, consideration

and effort is allocated to its social media marketing channels. This results in a lack of vision, forward planning

and setting of SMART objectives to take full advantage of the immense opportunities that social media offers,

as outlined by Gilmore et al. (2006).

The marketing manager, who has no previous experience of using social media within a business context,

has attempted to experiment and learn the benefit of Facebook with the assistance of colleagues in the IT

department. The majority of their social media platform posts relate to staff members, incorporating appetising

pictures of the products available within their store. Although there is no content strategy, they do occasionally

research how other competitive food-related businesses use social media and the frequency and popularity

of their posts, in relation to their own. However, it appears that social media is still not a priority, as even

Facebook is given no particular allocated time each week to create, plan and update effective posts. In fact,

the marketing manager has stated, "Social media is not our priority and never will be in the near future! ... we

play around with Facebook and there is no major strategy with it and it is another way to keep in touch with

the customers ... sometimes it is fun and sometimes it is interactive."

Challenges of Harnessing Social Media Effectively

As an SME, Luxury Food Stop is often restrained in terms of time and human resources, which can

mean that their staff are overstretched, thus causing work activities to be prioritised. A typical day for the

marketing manager consists of: advertising, merchandising, pricing, purchasing and signage plus many other

"hands on" activities. Due to the pressures of the day-to-day running of the store, the marketing manager

commented that, "social media is not that important for us so it won't get a lot of attention". This remark

is understandable. Fillis and Wagner (2005) observe how it is generally commonplace that SME marketing

managers concentrate on enhancing one area of their business performance at a time, the traditional method

of trading in this environment.

Another major challenge facing Luxury Food Stop is the difficulty of getting its voice heard on Facebook. The

marketing manager stated, "I do not have the time, the effort or the inclination to try to work out what it is that

I need to do on Facebook to get a bigger hearing. It is not that important and I don't have the time for it."

The marketing manager's lack of time, plus the obvious lack of expertise and motivation to use this marketing

medium, has caused frustration and undue stress around the implementation of social media marketing.

Further key challenges may include lack of planning or strategy, lack of finance to secure external expertise,

lack of appropriate knowledge and understanding as well as lack of balance between retail and cyber space.Overall Marketing Approach of the Company

Customer relationship means a lot to the Luxury Food Stop, having approximately 7,000 shoppers per week

entering their store. Many of these customers visit on a regular basis but the marketing manager does not

have a system to record and measure their consumption pattern. This therefore makes it problematic to

tailor social media marketing activities, notably Facebook, to a specific category of shoppers. The marketing

manager further explained, "I don't know whether the people who liked us on our Facebook page are

customers or not. Whenever they have liked us, they are not necessarily customers but I imagine most of

them are our customers ... quite a few would be staff as well."

The company does not use Facebook Insight (a popular measurement tool) to determine important and

relevant information regarding each customer who visits their site, including their loyalty and length of each

visit. The marketing manager stated, "We don't really measure the effectiveness. Each week we look at the

measures given us by Facebook and that is about it!" These measures provided by Facebook are limited

to duration on site, number of unique visitors, level of engagements and reach of postings. Social media

measurement tools such as Facebook Insight enable marketing managers to compile the information in order

to analyse and evaluate data, resulting in better informed management decisions.

Therefore, the implementation of an effective social media measurement would enable Luxury Food Stop to

move forward and assess their plans for the coming year, thus stimulating continuous improvement from one

social media marketing campaign to the next.

Summary

This case study has examined the issues faced by an SME grocery retailer in the implementation of social

media marketing. It has outlined the challenges, difficulties and typical time constraints facing SME marketing

managers in their day-to-day activities. In order to successfully implement effective social media marketing

for an SME, marketing managers need to, first, carefully choose the social media marketing platforms, plan

their digital activities, prioritise social media marketing, set realistic objectives and use relevant measurement

tools to report their findings. Nevertheless, due to a number of inherent SME marketing characteristics small

business marketers are not capitalising on the potential of social media channels.

Managerial Recommendations

It is recommended that marketing managers of SMEs:

acknowledge the importance of social media as an opportunity for them in today's digitalised retail

environment;

use social media to sell, deliver customer service and strengthen customer relationships;

acknowledge that social media is an important tool for retailers in an especially challenging multi

channel retail sector;

target an appropriate segment of online customers through rigorous market research using relevant

social media measurement tools.

Discussion Questions

1.

The marketing manager of the Luxury Food Stop has opened two unproductive social media

accounts. What are the dangers of doing this without any intention of continuously updating and

maintaining them?

2.

Discuss the other social media errors that the marketing manager may be creating for the company?

3.

Provide examples of how marketing managers of SMEs can overcome their social media

challenges?

4.

What is the importance of the results to SMEs of measuring social media marketing activities?

5.

Provide at least two examples of other social media platforms that Luxury could consider adopting,

giving reasons for your choices?

6.

Identify the choices of methods available to successfully implement social media marketing.

References

Fillis, I. , & Wagner, B. (2005). E-business development. An exploratory investigation of the small firm.

International Small Business Journal, 23(6), 604-634.

Gilmore, A. , Carson, D. , & Rocks, S. (2006). Networking in SMEs: Evaluating its contribution to marketing

activity.International Business Review,15(3), 278-293.

Kaplan, A. M. , & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of social

media.Business Horizons, 53(1), 59-68.

La Via, G. , & Nucifora, A. M. D. (2002). The determinants of the price mark-up for organic fruit and vegetable

products in the European Union.British Food Journal, 104(3/4/5), 319-336.

Omar, O. , & Fraser, P. (2011).SME retailing in the UK. Entrepreneurship marketing: Principles and practice

of SME marketing. In S. Nwankwo , & A. Gbadamosi, A. (Eds.). InEntrepreneurship marketing: Principles

and practice of SME marketing. London: Routledge.

http://dx.doi.org/10.4135/9781473937581