Digital marketing agency 360i (authors of the most excellent Social Marketing and Digital Couponing Playbooks) has just published a new strategic report and POV on social commerce for brands in the consumer packaged goods (CPG) industry.

The report is embedded below and can be downloaded from slideshare, and our word cloud summary gives you an overview-at-a-glance, but here’s the speed summary.

The top takeout from the report is that social commerce is a small but critical component of a successful CPG digital strategy.

Specifically, although the entire social commerce market ($1bn in 2011) is currently worth only one fifth of one percent of that represented by the supermarket channel ($500bn) – not including the $238bn drug store sales, it has a key role to play for brands looking harness three bigs trends

  • The growth of online retail in CPG (growth 25-30% per annum)
  • The rise of the smart shopper – shopper using of social intelligence (learning from others) to inform purchase decisions (by adding consumer 5 star rating to a coupon, Rubbermaid increased redemptions by 10%) – (Bazaarvoice, Zeer, Consmr – ‘Web MD for CPG’)
  • The meshing of online and traditional retail (the report highlights the opportunity for brands to generate rich shopper insight by adding the social graph to loyalty card programs – e.g. Nielsen Online Basket View)

The specific benefits that social commerce can bring to CPG brands is to enhance customer experience, and one solution is to use social channels as DTC (direct to consumer) platform for driving loyalty with brand fans.  The article points to P&G, who have recently set up fan stores on Facebook, to listen to, talk with, energise, support and embrace fans.

P&G Social Media Lab Operating Framework


  • Develop a sounding board – private community
  • Monitor buzz for ongoing assessment of trends and perceptions


  • Enable fans to spread message
  • Continually communicate directly with consumers & monitor feedback


  • Designate fans to lead others – brand ambassadors
  • Enable review, ratings to harness fans as sales


  • Enable customers to help each other
  • Enable customers to build solutions together


  • Harvest customer to help each other
  • Engage in co-creation of products & services

4 Social Commerce Challenges for CPG brands

The paper summarises four challenges that any successful social commerce strategy will have to deal with

  1. Scale: It’s unlikely that social commerce – e-commerce in social channels – will grow to have a significant impact on the top or bottom line.  The goal of social commerce should be to drive loyalty for brand fans and provide value – customer understanding, customer feedback – to the business
  2. Value Exchange: Brands will need to demonstrate the value of social commerce for the consumer – what’s in it for them. The key will be to offer a compelling reason for why consumers should purchase from your social channel rather than Amazon.  Fan-first, fan-only exclusive offers and products may be the solution.
  3. Fulfilment Costs (of Non-Perishables): Until refrigerated deliveries become mainstream, CPG brands should pilot social commerce with non-perishable (small and light) goods, whilst partnering with specialist online grocery delivery firms to explore social commerce opportunities for fresh, bulky, heavy and refrigerated goods
  4. Channel Conflicts: The risk if DTC social commerce takes off is jeopardising relationships with retailers.  Brands should avoid this – by working with retailers – for example P&G plans to allow consumers to buy goods on Facebook through its retail partners. [We’d add that fan-stores, if set up smart, should drive traffic and footfall to retail partners – with fan-first exclusives that create buzz around new product launches].
The report also notes that social technology makes shoppers smarter and thus creates an ever-more rational market.  Brands should not try and ‘game’ the system – but focus on fairness, transparency [and the Golden RuleDo unto your customers as you would have the brand do unto you].