You'll Never Believe Which Department Store Dominated Facebook During The Holidays (Hint: It Wasn't

By Markets Fool.com

Turns out it was a very merry Christmas for the department store chain.

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This week Macy's said its full-year 2014 profit would be better than it previously forecast because shoppers flocked to its stores in greater numbers than they had the year before.

That follows the upbeat note J.C. Penney gave last month in which it said comparable-store sales would likely come in at the high end of its prior guidance for a 2% to 4% increase. Even Kohl's boosted its earnings guidance based on stronger than expected holiday sales.

Yet despite all the good cheer and tidings, none of these retailers came out on top with consumers who engaged with department stores on Facebook through page likes, comments made, or shares of stories with friends.

Give it a thumbs-up
A recent Forrester study of nearly 5,000 U.S. consumers found Facebook has quickly become the go-to resource for discovering information, second only to Google and ahead of television advertising and shows.

Along with other social media sites, Facebook is playing an increasingly critical role in how consumers make purchasing decisions.

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It attracts almost 1.4 billion users to the networking platform globally every month, 890 million of whom are considered active daily users (157 million are in the U.S. and Canada). Users on average spend 39 minutes a day on the site, or 38% of the time they spend on all social networks, and the digital marketing analysts at eMarketer say that is attracting advertising dollars.

All those ads must be working
Businesses allocate about 10% of their U.S. digital ad spending to Facebook, which is disproportionate to the amount of time people are on the site. People spend more time on Pandora, but advertisers are allocating just 1.4% of their digital ad dollars to the music-streaming site.

So making a connection with users and consumers on Facebook is becoming more important due to its multiplier effect. Once a friend or relative likes or shares a page, you're more likely to investigate it, too. Like the old shampoo commercial said, "And so on, and so on, and so on."

Which is why the Searchmetrics ranking for the most popular department store on the social networking site is so interesting.

The survey says...
Searchmetrics, an enterprise SEO and content marketing analysis firm,analyzed the social media activity surrounding nine U.S. department stores and three mass merchant shops during the holiday season. They crawled Facebook to see which one enjoyed the most likes, comments, and shares during the most wonderful time of the year for retail.

Macy's came in a surprising third place with over 2.3 million links per week during the holiday season, or the number of likes, comments, and shares it enjoyed. Kohl's came in second, registering more than 5.2 million links (J.C. Penney was a distant fifth, at about just 394,000 links).

So what was the most liked department store on Facebook over the holidays?

None other than Sears Holdings !

With over 12 million likes, comments, and shares per week, Sears rang up more than double the number of links of Kohl's, five times as many as Macy's, and over seven times the number collected by fourth place Nordstrom.

Data: Searchmetrics.

Considering the dwindling sales Sears has reported year after year after year, this is a bit of a head-scratcher.

Have it your way
Yet on closer inspection, maybe it's not so shocking. For all the many criticisms I've had over the direction Chairman and CEO Eddie Lampert has taken the old-line retailer, he has undeniably invested heavily in the digital arena.

The old-line department store has learned a few new-fangled ways to connect with customers.

Among his many investments is the Shop Your Way membership loyalty program that awards customers points depending on how much they spend, whether it's in-store, online, or via catalog. As a result, 72% of all eligible sales at Sears and Kmart stores are from Shop Your Way members.

Lampert has used the program as a stepping stone to transform his integrated retail strategy, and third-quarter online and multichannel sales grew approximately 9% from the previous year. Sears also experienced approximately 18% growth over the first nine months of 2014.

It will be interesting to see how the fourth-quarter results pan out, particularly in light of the brighter prospects offered by its rivals.

Still a minefield of risk
I wouldn't say Sears is anywhere near being out of the woods. Its business is still faltering, and growth of the Shop Your Way program, while accounting for more of its sales, is easing. The retailer's same-store sales are still declining (despite a rare positive note at Kmart last quarter) and Lampert has had to resort to financial gimmickry again to keep the business afloat.

Yet connecting on Facebook could finally signal a change of fortune for Sears Holdings, and though I wouldn't put my money into its stock just yet, a reversal of its sorry recent past would be something all investors would like, comment upon, and share with each other.

The article You'll Never Believe Which Department Store Dominated Facebook During The Holidays (Hint: It Wasn't Macy's) originally appeared on Fool.com.

Rich Duprey owns shares of J.C. Penney Company,. The Motley Fool recommends Facebook, Google (C shares), and Nordstrom. The Motley Fool owns shares of Facebook and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.