Facebook and Small Business Case Study – Milan Direct

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Facebook and Small Business Case Study – Milan Direct

 

In this instalment of Words that Bite, I look at the strategies that online furniture retailer Milan Direct has employed in what’s become a very successful Facebook marketing campaign.

Milan Direct

The background

Milan Direct is Australia’s leading online furniture retailer, founded by high school friends Dean Ramler and Ruslan Kogan in 2006.A cool chair in the desert

You could say that Dean Ramler has furniture in his blood. His grandfather started the family business, Ramler Furniture, in Melbourne in the 1950s, and Dean has said that his attention to detail came from working in the store with his grandfather when he was a child.

Ruslan Kogan is the person behind the Kogan online electronics store and Kogan Mobile (which found itself in trouble when its wholesaler went into administration and ended its contracts with Telstra). I guess he knows how tough starting a business can be because, like lots of high-flying entrepreneurs, things haven’t always gone smoothly for him.

It was Dean who came up with the idea behind Milan Direct. While travelling in Italy, he realised that if he cut out the wholesaler, he could sell high-quality designer furniture cheaply. There wouldn’t be any actual showrooms. Instead, everything would be displayed online in a virtual showroom and customers would purchase items online.

Dean and Ruslan faced a lot of opposition to the concept behind Milan Direct. Their friends and family told them they were crazy because furniture was something customers had to touch and feel before buying. The brick-and-mortar retailers, such as Harvey Norman, IKEA, and Freedom, said the same thing. However, Dean and Ruslan pushed on, because they were convinced that the customer’s main concern is getting the best possible product at the cheapest possible price.

Milan Direct was tiny when it started. According to what Dean has said in interviews, the two guys initially shared a little office containing one table. They went 50/50 in the business and each invested $10,000, and began by selling two products – two classic lounge chairs.

The company eliminated any perceived risk on the customer’s side by providing:

  • The virtual showroom, so people could see exactly what they were buying.
  • A 12-month warranty on all their products and the option to buy an extended warranty.
  • A 14-day-money-back guarantee, so customers could return a product if they didn’t like it.

To a lot of people’s surprise, Milan Direct took off immediately, and it didn’t hurt that its products were often 50 per cent cheaper than those sold in conventional furniture stores. It wasn’t long before Dean and Ruslan purchased a manufacturing plant in China; since then, they’ve reinvested all the profits back into the business. They now sell thousands of products for both the home and the office. Since 2006, the company has sold 700,000 pieces of furniture to customers in more than 40 countries. In 2009, they set up a UK version of the site, to sell furniture around Europe. In 2012-2013, Milan Direct has been on track to bring in $15 million in revenue. The next step is to move into the Asian market.

The Facebook campaign

There is no doubt the main reason for Milan Direct’s success has been its ability to undercut its competitors and provide a high-quality product cheaply. However, its use of social media has played a key role in the way it’s built up a base of customers who return again and again to buy its products. The Facebook campaign has been particularly important.

At the time of writing, the Milan Direct Facebook page has had over 55,000 likes. Through Facebook, the company has built a community where people who are interested in interior design can chat and provide feedback.

Here’s a breakdown of the strategies Milan Direct has used in its Facebook marketing campaign.

Strategy No. 1: Employ staff to run social media

Milan Direct takes its social media marketing very seriously. So much so, it has employed several people to work solely on social media.

The question you need to ask yourself as a small business owner who is thinking of going down the social media route is whether you have sufficient resources to embark on a campaign. You need to decide whether you are willing to put in the time and effort yourself, or whether you need to employ someone to do it for you.

Most of the owners and/or managers of small- to medium-size enterprises who I talk to say that they delegate the management of social media to someone further down the food chain, who does it along with their other duties. Basically, they feel that they need a Facebook presence but seem unwilling to devote too much attention to it.

However, I think every business owner/manager needs to think carefully about whether this is the right approach. More often than not, a half-hearted Facebook campaign falls flat. Long ago I came to the view that a successful social media marketing campaign isn’t something that can be delegated and then forgotten about by the delegator.

Strategy No. 2: Use lots of images

Like Sprinkles Cupcakes, Milan Direct is fortunate that the products it sells are photogenic. After all, designer furniture and decorating ideas are great subjects for photographs and, therefore, help to make for an attractive Facebook page.

Strategy No. 3: Provide great content, giving people a reason to come back

Milan Direct posts high-quality content that gives people a reason to come back to visit its Facebook page.

The content includes:

A. Deal of the Day

This is where Milan Direct informs its customers about current specials and bargains. There is no doubt that people look out for these.

B. Design ideas

One of the most popular aspects of the Milan Direct Facebook page is its ‘design tips’. For example, on 26 October 2013, it posted a photograph of a set-up for a romantic picnic. In another post, it showed a kitchenette decorated in pastel colours and asked fans whether they thought the design worked. These are great ways to get fans participating in the Milan Direct ‘conversation’. They’re also very effective ways to conduct market research.

C. Design blogs

Milan Direct uses its Facebook page to provide links to its design blogs on its webpage. In this way, it is clearly giving something back to its customers.

D. Latest products

Quite often, Milan Direct posts new products from its range on its Facebook page. This not only informs people about these items but allows them to provide instant feedback on them. Once again, this is a quick and easy way to conduct market research.

E. Competitions

Another useful strategy in Milan Direct building up a loyal following has been to run competitions.

F. Behind the scenes

Sometimes, Milan Direct provides glimpses of what goes on behind the scenes at the company.

G. ‘Happy Friday’

Every Friday, Milan Direct has a segment called ‘Happy Friday’, where it posts a romantic destination and asks its fans whether they would like to spend time there. This is a clever way to engage people in the Milan Direct community as they wind down at the end of the working week.

Strategy No. 4: Post regularly

One of the most important aspects of having a Facebook business page is posting regularly. Milan Direct posts at least once a day. This means that fans of the page know they can expect fresh content when they check in to see what is happening.

Strategy No. 5: Respond to complaints immediately (show you care)

Milan Direct is particularly good at responding to complaints on its Facebook page. It doesn’t ignore negative feedback; instead, it immediately addresses any issues. In the process, the company shows that it is focused on customer service and is willing to bend over backwards to keep its customers happy.

To summarise

Milan Direct grew from a tiny company that no one thought would work, into an online furniture powerhouse with global aspirations. One of the key elements in its marketing strategy has been to build a strong Facebook page and create a community of fans that is directly engaged with the brand.

The strategies it has used to do this include:

  • Employing staff to work exclusively on its social media marketing.
  • Using lots of attractive images.
  • Providing great free content that encourages its fans to keep coming back to see what else the company has to offer.
  • Updating its Facebook page regularly.
  • Responding to, and addressing, any complaints quickly and efficiently, demonstrating the company’s commitment to its customers.

Once again, the Milan Direct story shows that there are no shortcuts to a successful Facebook campaign. It takes commitment, lots of good ideas, and plenty of hard work.

In the next instalment of Words that Bite, there will be another case study of a small business that has set up a successful Facebook marketing campaign.

Are you too busy running your business to think about whether you should embark on a social media marketing strategy? Would you like someone to look at the issue for you? If so, call the Pink Rottweiler on +61 (0)409 609 903 or email me at info@pinkrottweilercopywriting.com.au.

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