Consumer Psychology for a Digital Age

Simple Definition of Social Commerce (with Word Cloud & Definitive Definition List) Updated Jan 2011

Social Commerce is a buzzword and it’s hot lexical real estate, evoking a fusion of two big digital trends of “social media” and “e-commerce”.

As a result, social commerce means different things to different people (see list below), and it’s been the target of a number definitional land-grabs by businesses seeking to define the term based on what they sell.

So here’s a no-vested-interests inclusive word cloud definition of “social commerce” that we created (with the wondrous Wordle).  We simply took 18 top definitions of social commerce and threw them together into Wordle, and this is the result; (word size proportional to word frequency)

click image to enlarge

click to download

Okay, so you can’t use the word cloud definition of social commerce as your elevator pitch definition, but exploring the cloud provides a conceptual understanding of social commerce and its key themes (don’t want to go all Wittgenstein on you, but idea clouds approximate to how our minds store concepts).  The social commerce cloud is also a potentially useful creative stimulus in thinking about how to deploy social commerce.

Based on the word cloud we’ve come up with a simple inclusive definition of social commerce.

Social Commerce: 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.

Or the cocktail party version:

Selling with social media – the use of social technologies in the context of retail

[Update] As the above definition denotes, the concept of social commerce has been expanded beyond e-commerce to include the use of social technologies in the context of retail – whether online or in-store.

Examples of social commerce include user ratings and reviews, user recommendations and referrals, social shopping (sharing the act of online shopping together), user forums and communities, social media optimization (for e-commerce), and social applications and social ads linked to e-commerce.

And hey, if you don’t like this inclusive definition of social commerce, you can always pick one from the timeline list of definitions below!

  • Definition 1: David Beach(Yahoo) (November 14, 2005)
    • Social Commerce: The Shoposphere and Pick Lists are examples of social commerce. We believe the community of shoppers is one of the best sources for product information and advice
  • Definition 2: Dave Beisel(Venrock) (December 6, 2005)
    • Social Commerce: Subset of “advertorial content”, where content is the advertising… generated by a friend [wishlists… giftlists… picklists… tags… recommendations]… to provide consumers with rich social context and relevancy to the purchases which they are making
  • Definition 3: Steve Rubel(Edelman) (December 23, 2005)
    • Social Commerce: Creating places where people can collaborate online, get advice from trusted individuals, find goods and services and then purchase them.
  • Definition 4: Dave Beisel(Venrock) (November 1, 2006)
    • Social Commerce: Social input in online shopping services [that] augments the experience [c.f Social shopping: Sharing the act of shopping itself with others; …a subset of social commerce as a whole]
  • Definition 5: Ken Goldstein(Shop.com) (December 2006)
    • Social Commerce: Creating new and more meaningful ways for retailers to interact with customers [through] search, communication and community
  • Definition 6: Sam Decker(Bazaarvoice) (June 2007)
    • Social commerce: Strategy of connecting customers to customers online and leveraging those connections for commercial purpose
  • Definition 7: Linus Gregoriadis(eConsultancy) (August 2, 2007)
    • Social Commerce: Customers having the means to interact with one another in order to make better buying decisions.
  • Definition 8: Lee Raito(LeeRaito.com) (August 11th, 2007)
    • Social Commerce: A trusted environment where friends, family and acquaintances dynamically contribute content to the referral and sale of goods and services though positive and negative feedback, reviews, ratings and testimonials regarding their experiences past & present. In short, social commerce is a trusted environment of which prospective consumers make buying decisions based on the advice of a network of friends and family, not strangers they don’t know or trust.
  • Definition 9: Wikipedia(September 27, 2007 version)
    • Social commerce: Subset of e-commerce in which the active participation of customers and their personal relationships are at the forefront.
  • Definition 10: Jay Deragon(Social Media Directions) January 2008
    • Social Commerce: Conduct[ing] commerce using social networks
  • Definition 11: Brendan Gibbons(Practical eCommerce) May 2008
    • Social Commerce: Monetizing social media sites…applications transform[ing] a profile page on a social network into an online store, complete with payment processing.
  • Definition 12: Craig Agranoff(Scommerce) (September 2008)
    • Social commerce: Buying and selling stuff online with friends helping
  • Definition 13: Andrew Stephen and Olivier Toubia(Columbia / INSEAD) (September 2008)
    • Social commerce: Emerging trend in which sellers are connected in online social networks, and where sellers are individuals instead of firms. [The distinction between social shopping and social commerce is that while social shopping connects customers, social commerce connects sellers].
  • Definition 14: Jeremiah Owyang(Forrester) (April 2009)
    • Social Commerce: [The Fifth Era of Social Media]: Brands will serve community interests and grow based on community advocacy as users continue to drive innovation in this direction.
  • Definition 15: Paul Dunay(Avaya) (October 2009)
    • Social commerce: Working with or using your social graph, which is defined as your followers or your friends, and allowing them to help you make buying decisions.
  • Definition 16: Fumi Matsumoto(Allurent) (November 2009)
    • Social Commerce: Enabling consumers to browse, view, and add products to a shopping cart, within the context of a social site, like Facebook or a blog
  • Definition 17: IBM(October 2009)
    • Social Commerce: Connect and foster active participation with customers to help improve your customer experience… including ratings and reviews, blogs, micro-blogging as well as forums and communities
      • 17a Social Commerce: The concept of word of mouth in the context of e-commerce
  • Definition 18: Paul Marsden (Social Commerce Today) (November 2009 Updated)
    • Social Commerce: 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.
      • Social Commerce: The use of social media in the context of e-commerce
  • Definition 19: Pierre Raiman (Sherpad) (December 2009)
    • Social Commerce rises through trusted advice in conversations and word-of-mouth among your friends and relations in social networks, blogs, and communities, helping to make shopping decisions and transactions
  • Definition 20: John Jackson(DecisionStep) (February 2010)
    • Social Commerce: The ability of two or more people to collaborate online, to share opinions and influence each other’s buying decisions
  • Definition 21: Bill Zujewski(ATG) (February 2010)
    • Social Commerce is about customers having the means to interact with one another in order to make better buying decisions
  • Definition 22: Jochen Krisch (ExcitingCommerce (cited here) (June 2010)
    • Social commerce models are ecommerce models that focus on people instead of products
  • Definition 23: Jason Weaver (Shoutlet/ LinkedIn Social Commerce Group) (Jun 2010)
    • Social Commerce: Selling with social media
  • Definition 24: Lora Cecere(Altimeter group) (Nov 2010)
    • Social commerce is the use of social technologies to connect, listen, understand, and engage to improve the shopping experience

Comments (41):

  1. Cyrstal Sean

    March 6, 2010 at 09:15

    Heya…my very first comment on your site. ,I have been reading your blog for a while and thought I would completely pop in and drop a friendly note. . It is great stuff indeed. I also wanted to ask..is there a way to subscribe to your site via email?

    Reply
  2. Matthew C. Kriner

    March 9, 2010 at 20:39

    I think that without a doubt social media is changing the landscape for advertisers. Twitter, facebook, blogs, video, etc is a way to speak to consumers and not just at them.

    Reply
  3. Arnold Waldstein

    June 10, 2010 at 16:36

    My definition of Social Commerce for the Facebook platform.

    It is a dynamic online version of shopping with friends…but on the global, real-time Facebook stage. The intersection of community, commerce, social dynamics…and fun, where the influence and opinion of friends drives the transaction. A pure community referral-based economy.

    Reply
  4. paulsvmarsden

    June 10, 2010 at 20:52

    Thanks Arnold, solid definition – like it!

    Reply
  5. Ram Dutt

    October 4, 2010 at 19:23

    Although the definitions are varied from the perspective of different experiences, the commonality is the same and your definition summarizes it very eloquently.

    Reply
  6. Jenice Woo

    December 23, 2010 at 09:35

    Of course, what a magnificent blog and enlightening posts, I definitely will bookmark your website.All the Best!

    Reply
  7. Santosh Dawara

    April 13, 2011 at 04:44

    An interesting twist to Social Commerce Campaigns to make them work for Online Retail

    For the sake of disclosure, I work for ShopSocially, a social shopping recommendation platform. I think that a lot of retailers are not thinking outside the box about Facebook. Rather than look at Facebook as a selling channel, it may be better to use Facebook as a friend recommendation channel. Blatant selling on Facebook is considered a no-no.

    Social recommendation is the way to go, not Facebook storefronts. After the shopper finishes a purchase on a retailer site, if the shopper can be given an easy way to share the purchase with friends, that brings in real dollars.

    We are working with dozens of top retailers who are seeing 250,000+ brand impressions and 5,000+ high converting clicks every day via social recommendation. Here is an actual case study (http://bit.ly/fsdMb4) and some stats (http://bit.ly/fBDGEy). Our data shows that purchase that is shared by a shopper on Facebook is worth $3.08 to $5.56 per post to the retailer. Our retailers are seeing a 2% to 6.5% uplift in revenues. These numbers are significant. Retailers should be tapping into the social recommendation channel.

    Reply
    • Geri

      February 9, 2016 at 15:09

      Begun, the great internet edaictuon has.

      Reply
  8. Jamie Mccaffery

    August 16, 2011 at 05:17

    I absolutely love your blog and find most of your post’s to be precisely what I’m looking for. Would you offer guest writers to write content to suit your needs? I wouldn’t mind producing a post or elaborating on a number of the subjects you write with regards to here. Again, awesome web site!

    Reply
  9. Sahy Cart

    September 1, 2011 at 11:44

    Selling with social media – the use of social technologies in the context of retail .social commerce

    Reply
    • Trent

      January 26, 2012 at 01:02

      This one gets my vote.

      2 small points I would add…

      – 1. Not just retail, any commerce
      – 2. Social Networks rather than Social Media (semantics, true, but I agree with Gary V that the term ‘media’ sends the wrong message!

      Reply
  10. free horses

    September 9, 2011 at 23:43

    I’m usually to running a blog and i really recognize your content. The article has actually peaks my interest. I’m going to bookmark your website and hold checking for new information.

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  11. help

    December 15, 2011 at 00:43

    great post keep up the great work.

    Reply
  12. Trent

    January 26, 2012 at 01:21

    Hey guys!

    Great article. As you say, ‘hot lexical real estate’, for sure.

    I guess with any buzzword, there’s a desire to find a long, detailed, all inclusive definition but I’m a believer in letting the market define it.

    Sure, it’ll take a bit longer to gain clarity, but ultimately that clarity should then be crystal clear. Understandable to all.

    The risk we have in trying to define a nascent segment with lots of fancy words (like ‘nascent!?!?) is that we can end up making it seem so complicated that people who really should be engaging (the average buyers & sellers) tend to steer clear of it coz they don’t understand it.

    “Social Commerce? Yeah, I’ve heard a lot about it, but it sounds really complicated & I don’t have enough time to work it out.”

    For this reason, I really like the simplest & the broadest definitions. Something like…

    Social Commerce = using social networks to help you buy and sell

    Thanks again!

    Reply
  13. Jeff

    January 29, 2012 at 05:10

    There are social shopping sites, a simple objective to get the right information quickly is luboh.com it allows people to ask and tell their selected friends and also tell the world anonymously. Useful for people anywhere in the world to find how much products and services cost and where they can get them from. It also has price comparisons within a geolocation.

    Reply

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