So will 2010 be the year of “social commerce”, the year when social media marketing moves beyond echo-chamber hype and settles down to become a suite of productivity tools to help online buyers buy and online sellers sell?
Well, social commerce has had some false dawns; Steve Rubel tipped 2006 to be the year of social commerce, Jay Deragon thought it would be in 2008. Forrester believe we’re a little ahead of ourselves and is predicting that 2011 will be the year of social commerce. Others, such as Simeon Simeonov, predict that the future of e-commerce will be social, but (perhaps sagely) do not tie themselves down to a date. But we think the time for social commerce is now, so we’re predicting 2010 will be the year of social commerce.
Why 2010? Three Reasons:
1) Social Commerce SAAS has arrived. This is new. No more expensive custom developed tools and platforms. Instead ‘plug-and-profit’ social commerce software-as-a-service solutions are here. Negligible set up costs, simple subscription plans, no hassle-implementation and proven track records mean that there is now no reason not to offer customer reviews, group-buy or co-browsing functionality on an e-commerce site, or add e-commerce functionality into a social networking presence. From PowerReviews Express, to eWinWin, Plurchase, and Payvment, there’s a tool for every budget.
2) The mainstreaming of e-commerce. Whilst the economy is flat, online retailing continues to enjoy double digit growth, and as a consequence online shopping is becoming a mainstream activity across generations. No more ‘would-you-shop-online?’, now it’s ‘when-did-you/will-you-shop-online?’. From Gen-M (mobile) to Silver Surfers, the e-commerce Tipping Point has been reached; it is becoming second nature to look online for deals, ideas, reviews and price comparisons. Even household brands previously dependant on traditional retail are moving online – as exemplified by the recent launch of Alice.com (pantry concierge).
3) The social media bubble has burst. So we’ve survived the hype cycle of social media, and come out relatively intact, if jargon-laden, from the peak of inflated expectations and a subsequent trough of disillusionment. And we’re now on a slope of social media enlightenment, where the frankly mad ideas about revolutions and paradigm shifts have given way to pragmatic, practical tools to help people do stuff better, faster and cheaper than before. If you want your social media evolutionary not revolutionary, then social commerce is the solution.
Consider for a minute how gargantuan the social shopping/merchandising market opportunity is: the current US retail market (excluding home and automotive) is around $4+ TRILLION/year and is supported by $150+ billion in advertising, the bulk of which still goes to TV for immersive, emotionally impactful ads.
Capturing the proverbial 1% of that total market would represent over $40 billion/year in transactions which is huge! So, clearly, whomever figures out how to get paid to unlock socially-driven product discovery and merchandising is going to make an astounding amount of money and have a huge impact on net culture.