Why Amazon DOES Understand Social Commerce


Here’s an interesting post, with some enthusiastic Amazon-bashing over at Marketing Profs by Customer Experience consultant Leigh Duncan-Durst of Livepath.

In a nutshell the post argues – with some groovy Radian6 charts – that Amazon is an anti-social company that needs to “pull its head out of the virtual sand”: Amazon just doesn’t understand social commerce, hasn’t been keeping pace with changes in social media, and is failing to use Facebook and Twitter for customer service and crisis communications.

Leigh Duncan-Durst’s post is smart, evidence-based and well thought through.  And it’s a point of view.  Here’s an alternative – and one we think that brands and retailers may consider as a counterpoint when developing their social commerce strategy.

Why Amazon Does Understand Social Commerce

A pioneer in adding a social layer to e-commerce, with ratings, reviews, tell-a-friend, and wish lists, Amazon understands that social features and a social business mindset may have a key role to play in its future growth.

So through a mix of joint ventures and acquisitions Amazon is acquiring social expertise – the purchase of BuyVIP, a leading European version of Gilt.com a members only club for private-sales; the purchase of customer experience darling Zappos, a partnership with consumer goods giant P&G to sell on Facebook, and partnering in the sFund with Zuckerburg that is backing, amongst others, the next generation “this is not your mother’s social network” social commerce platform Lockerz (with the natty I-wish-I-had-thought-of-that “friends with benefits” tagline).

In addition:

We could go on, but the point is that there is no cookie-cutter solution to doing social commerce; we think Amazon is being smart with social commerce; buying in proven expertise, building on what it knows works, investing where there could be a clear return on investment and experimenting carefully.

For big companies, the best kind of social is often when social is not used to talk to customers,  but is used instead to enable customers to talk to each other, and to shop smarter.

There is a case for using Twitter and Facebook for customer service, but there’s also a good case for not doing so, especially if you a (very) large volume retailer; the ease of firing off messages on social platforms creates a information barrage, issues of scalability and a “drinking from the fire-hose” problem.

And as for using social media for crisis communications in PR, there’s a case for that when people need real time status updates (say an ash cloud or a train in the euro-tunnel), but censorship/anti-censorship rows – largely a case of the deaf shouting at the deaf – Amazon is smart not to add to the cacophony.

No Amazon isn’t perfect as Leigh’s post usefully points out, but we think it’s the nearest to a dancing elephant in the social commerce space there is.

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4 Comments

  1. […] This post was mentioned on Twitter by Paul Marsden and Paul Marsden, Urbae. Urbae said: Why Amazon DOES Understand Social Commerce http://goo.gl/fb/7si7Z #insights #fcommerce […]

  2. November 29, 2010
    Reply

    Paul,

    Thanks for sending me the link to your post. Posting this detailed response in both channels because the Mprofs article will only be publicly available until tomorrow.

    What made Amazon great to begin with wasn’t just selling… it was SERVING. Amazon’s strides, however large or small, such as enabling social sharing, link shortening, acquiring category leaders and investing in social innovators do *nothing* to answer the company’s failure to SERVE people within social channels.

    You say:
    “For big companies, the best kind of social is often when social is not used to talk to customers, but is used instead to enable customers to talk to each other, and to shop smarter.”

    This may have been true for eCommerce like, four years ago – but it only applies to things like ratings, discussion, reviews and referrals — the “innovative” tools of yesterday that are now commodities on retail sites. It doesn’t hold true because the crowd isn’t going to help a customer whose order is lost, or whose data is incorrect, or who is the victim of a system malfunction or a broken down delivery truck. The crowd isn’t going to help when there’s fraud against your account…

    Providing service and support is an integral and critical component of running a successful retail business. When any service-centric business sets up a presence within one or more social channels, they MUST have a game plan for service. At a minimum, the company should clearly direct them to proper channels for response and resolution. This is especially true for Amazon, where great customer service has been a hallmark.

    I’m well aware of the Sfund, and Bezos’ attention on Amazon Web Services (AWS) and its extension and domination into the marketplace. I pointed out some of this in my article already. However, after about 19 years in eCommerce and digital/web strategy, I refuse to get caught up in shiny object syndrome.

    Every day *people* don’t give a beaver’s dam how many companies Amazon has acquired or invested in, or how many technical hoops were jumped through to produce shorter URLs. People want to find stuff, buy it, and have it delivered on time. When they have questions and things go wrong, they want help – right where they are — and in a timely manner. They don’t want to be patently ignored in channels where Amazon *claims* to be active. This is the blind spot our research addresses, and the critical flaw in Amazon’s approach to social commerce.

    To your earlier point, this ISN’T about demanding perfection — it’s about calling attention to Amazon’s pattern of blatantly ignoring potentially hundreds (up to more than a thousand) people each day within venues where the company has a WELL established presence. This includes Twitter (15+ active accounts) and Amazon (At least five official fan pages), where they will not respond to “point-of-need” requests for help, assistance or response. To brush that off as a small thing seems irresponsible.

    I spent a significant of my career building successful eCommerce presences for blue chip brands — which perhaps helps explain my perspective. Maybe this is why I find it difficult to understand how you can so easily dismiss the social CRM aspect of these tools. Even if you have no experience running a customer-centric retail enterprise, it’d be hard to miss the success stories of companies like Dell, Comcast, Best Buy and others, who are using social media to serve people well. They’re also doing it affordably and effectively while driving sales and WOM.

    In parallel, it seems that Amazon has taken the path of least resistance to promote and sell in social channels. You call this smart, while I call it short-sighted in light of the company’s total failure to serve people. Sadly, Amazon is still trying to figure out how to serve and they’re behind the eight ball on this one.

    When I see signs that Amazon is taking on the customer service mountain, I’ll cheer for them… When I see a return to a genuine focus on service, I’ll rejoice! Until then, we can agree to disagree. :) Thanks for adding to the dialog.

    Leigh Durst

    • November 29, 2010
      Reply

      Hi Leigh, thanks for thoughtful reply. I think we may agree – Amazon has been trailblazing with selling in social media, but not serving in social media. Completely agree with you on the critical importance of customer service, just not sure social media is the best (effective, efficient) channel for doing customer service. Time will tell!

  3. […] social recommendations, recently (and amusingly) culture-jammed by Harvey Nichols.  And we know what people think of Amazon and social (although we politely disagree – Amazon did’t miss the social boat, it built […]

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