NewEgg Took Some Chances...And So Should You!

According to today's article on Internet Retailer, computer electronics retailer NewEgg.com has come right out and said that they're not in the social media game just for the money.

Sales from a page on MySpace or a discussion forum on their Eggxpert community site are great, but really are just a means to an end: reaching their customers. Their core fan base (which is probably a better way to refer their customers in particular) are male gamer geeks who build their own machines. To cater to this audience, NewEgg has steadily added feature after feature and reaped the rewards of new customers (reporting that 50% of their new customers were from other customer referrals).

Is it working? Considering their sales rose 25% last year to just below $2 billion, it's fair to say that this pureplay online retailer has done well with their approach.

What does this mean for other companies?

Experiment.
Try some new ideas.
Give Twitter a chance.
Test out a blog, even if it's internal.
Consider what Facebook to mean to your customers.
Ask your customers what they want and then give it them in spades.

You don't have to do everything at once, but each feature you add strengthens your relationship with your customers that much more. Newegg was clear about this with their social media goal: Get close to the customer and give them a chance to provide feedback. The Internet Retailer article highlights some great technology features they've thrown at their site to accomplish this. But that's not the point. Layering on more features was done within a clear context (and not just doing it because the competitors are doing it).

Even if your competitors are doing things in this space, those without an overarching vision and blanket statement on why they're doing this and what they hope to achieve will fail when they hit bumps in the road.

Consider this caustic chain of events:

1) Company starts a new blog and customers love it.
2) Situation comes up for the company, one exec reads the post and gets worried about a possible lawsuit.
3) Exec brings the issue to Legal, then demands to know why the company is blogging and who authorized the project.
4) No one has a good answer and the blog gets shut down.

Sad ending to a venture that started successfully, but it could get worse:

5) Customers that were reading the blog are upset that it's been discontinued. They ask why it's been taken down, but there's no one around to answer their questions.
6) Customers get frustrated and walk away.
7) Some customers that are really upset get upset enough to blog about it themselves.
8) Other disgruntled customers start chiming in, and the ensuing groundswell threatens to damage the company's credibility.
9) Customers walk away, prospective customers avoid the company like the plague, and the company doesn't even know what's transpired.

Okay, so it's not all doom and gloom. All I'm saying is that you've got to have a good reason (and don't just copy the reason above because it may not truly be something that will help you) but once you've got that foundation in place you've got to go for it!

Experiment!
Play around and have some fun with it!
Make mistakes and learn along the way...if you're catering to your customers, if you ask for their opinion and you're prepared to take some action on some of it, then how can you go wrong?

Live a little. NewEgg took this approach, and it helped them add $500million to their earnings last year. So what do you think this will do for you?