Social Commerce a Rising Tide
The more time I spend looking under the hood of social media marketing as it relates to ecommerce, studying trends and seeing what's developing, the more I'm convinced that the term "social media" should be more aptly labeled "social commerce."
Social commerce is a subset of electronic commerce that involves using social media, online media that supports social interaction and user contributions, to assist in the online buying and selling of products and services. (wikipedia)
The term was introduced in 2005, but the concept has only gained popular standing within the past year, thanks in part to sites like Social Commerce Today.
Testifying to its growing popularity are two conferences on the topic. Bazaarvoice recently held Social Commerce Summit 2010 and Charlene Li's Altimeter Group is hosting Rise of Social Commerce in October.
From conversation to commerce/conversion
Historically, social media has been associated with a conversationally-oriented, relationship-building style of marketing. That's still its UVP of course, but now more direct forms are being incorporated such as the use of coupons, special offers and social shopping. One innovative company, Dukky, has even found a way to blend direct mail offers with email and social media.
Social commerce puts customers in the driver's seat. For example, social shopping site Kaboodle, allows shoppers to build lists and share them with friends.
At the heart of the activity surrounding social commerce is Facebook. Fan pages, customized through the use of FBML (Facebook's markup language) and apps like those provided by Wildfire, Involver and Payvment, provide a digital hub for ecommerce and lead acquisition.
Word of mouth still the primary driver
Arguably, the most effective form of social commerce is word of mouth, specifically recommendations and referrals from customers to those in their network. Facebook's new Like button has made this a one click process.
Realizing its importance, many ecommerce platform providers have built social sharing into their shopping carts.
It had to come to this
Some might rue this evolution, even considering it an aberration not unlike sponsored conversations. Personally, I think it evidences social media's coming of age as a direct sales channel. (Perhaps we had to endure the one to get to the other.)
Let me close by quoting from Altimeter Group's post in reference to their upcoming conference, for I think they sum it up best:
Shoppers want to belong. They want to be heard. They crave a better buying experience. Power is shifting from the retailer to the shopper. Social commerce is filling the void between clicks and bricks to deliver a personalized experience. Join us to understand how to leverage these shifts to improve your brand.
2 Comments
Mallory says:
Paul - I think you are absolutely right when saying I think it evidences social media's coming of age as a direct sales channel... It's impressive to see how fast everything is moving in this field especially since the "Like" button arrived. Companies like Kaboodle and Dukky are great examples of the evolving technology behind it all. Thanks!
bobegner says:
I think Paul’s observations correlate with the information we hear in the market. Our customers tell us that there is a real-world analogy for this type of online evolution. Social commerce might be thought of an analogy to the sidewalk sale in front of a physical store, and the ”Like” rating is similar to an overheard conversation between other shoppers. The online version has the added dimension of persistence so the rating or review can live well beyond the actual event – for better or for worse. EPiServer’s international customers are using branded communities as a way to extend the sidewalk analogy, combined with public social media (analogy for the mall) to engage customers and drive loyalty.
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