Let’s get one thing clear- social commerce is not new.
From inviting friends to sharing recommendations, social commerce has been an integral part of commerce long before the internet.
So, what has changed? I believe that three consecutive innovations—”births” as I like to call them—served as catalysts in the creation of the digital social commerce phenomenon:
1. The Birth of Electronic Commerce (1995)
(Amazon, EBay, Zappos, online retailers)
2. The Birth of Advanced Social Networking (2002)
(Advanced social networks like Friendster, MySpace, Bebo)
3. The Birth of Democratized Content and Influence (2005-Today)
(Social Media and sharing driven by Digg, Twitter, Facebook, Addthis)
I understand #3 is relatively broad and debatable, but the basic point is an important one. The democratization of content gives everyone the digital megaphone to broadcast thoughts, recommendations and ideas to friends, peers and the media, thus demonstrating influence.
This is what drives effective social commerce- people influencing other people to make online purchases. BazaarVoice is a great example of a company that effectively leverages democratized content in ecommerce by powering on-site user generated reviews (the “megaphone”) to influence purchasing.
With this analytical starting point, Spinback is less interested in providing online retailers with the ability to share products and purchases; it is more about deploying multiple social integrations that drive sharing while providing measurable and actionable purchasing data. Our focus is to help retailers find their winning social commerce strategy, one that drives incremental purchases through influence, and then effectively launch and measure results. Consistent testing and optimising of the adopted strategy empowers influential users while remaining authentic and relevant to one’s brand and audience. Social commerce is not a one-size-fits-all game.
Consumers are already exponentially sharing non-transactional items like news articles from CNN, photos from Instagram, and videos from YouTube because they are inherently social. As e-commerce retailers continue to pop-up and online shopping becomes even more prominent, people will increasingly become more and more comfortable sharing transactional items like clothing, daily deals, books, and electronics as more of their purchasing decisions are made online. The latter plays a critical role in successes like Groupon and Gilt Groupe; customers find inherent value (self-discovery and peer-shared information) and tangible value (discounts and rewards) by sharing daily deals or new products available exclusively online.
How does one leverage social commerce effectively like Groupon? How does one figure out a killer strategy among the ubiquitously self-proclaimed social commerce tools available?
The simple truth is you can only make smart decisions for social e-commerce with relevant sharing, referral traffic, and purchasing data to utilise and hypothesize with. As Kurt Lewin, the pioneer of modern social psychology, correctly said, “There’s nothing as practical as a good theory.”
For 2011, I anticipate that online retailers who experiment with measurable social strategies and promote the key products that demonstrate incremental sales and conversions will only need to look at their bottom line—not their number of Facebook Fans—to know that they’ve started to figured it out.–AF
Editor’s Note: Spinback CEO and Co-Founder Andrew Ferenci will be a featured speaker at “MESA Presents: Social Commerce” on Tuesday, March 15 in NYC.
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