Although social media has been a hot button for retailers, it seems that 2010 is the year for social commerce to materialize. In an effort to better understand consumer perception and social media habits, ForeSee Results conducted a research study of nearly 10,000 visitors to the most popular U.S. e-tail sites.

“Everyone is talking about social media, and there are lots of opinions about how to do it right,” said Kevin Ertell, VP of Retail Strategy, ForeSee Results and author of the report. “We thought it was important to check in with customers to get their thoughts.” The survey aimed to answer questions like: How do they interact with retailers via social media? How would they prefer to interact? What value are they seeking from their interactions with retailers via social media?

The study found that social media could be validated as a viable marketing strategy when retailers understand what consumers want. ForeSee Results used the methodology of the American Customer Satisfaction Index (ACSI) to examine these issues. The ACSI is able to show how different elements of a shopper’s interactions with a company (including on social media) impact their purchase intent, loyalty and recommendations, according to the report.

"In terms of the innovation that Duane Reade has been putting into place, I have to think that part of the rationale (of the acquisition) is not just the expanded distribution and additional store count, but getting some of the skill sets rather than developing their own loyalty or CRM program,” said Craig Johnson, President of Customer Growth Partners, LLC, a retail consultancy based in New Canaan, CT.

Walgreen said Duane Reade stores will continue to operate under their own brand name after the transaction closes, but eventually the two brands will synergize, as Walgreen is currently operating 70 stores in the New York City metropolitan area. Duane Reade has made some significant strides to modernize and remodel the stores to promote a more customer friendly and focused strategy.

Top Performing Websites Etailing Group Customer Experience Index

Although online sales continued to outpace brick-and-mortar sales in 2009, online retailers still felt the pinch of the recent recession during the most recent holiday season. In response, a number of online retailers chose cost containment over improvements in customer service in Q4 2009, according to the e-tailing group’s 12^th Annual Mystery Shopping Study.

Merchants have made trade-offs on communication effectiveness and information accessibility to cut costs, the study reports. Year-over-year it took merchants longer to respond to email communication (20.69 minutes in Q4 ‘09 vs. 20.15 in Q4 ’08). Email responses were less likely to offer a personalized salutation (75% vs. 82%) and fewer gave correct answers (72% vs. 77%).

Additionally, call center performance was less effective in Q4 2009, with longer wait times for customer calls and some return policies have become more restrictive. In Q4 ’09 14% of merchants surveyed offered a 100% unconditional return policy versus 72% in ’08.