So you’ve probably read the Booz & Co forecast that social commerce revenues will hit $30bn by 2015 (if you haven’t read our speed summary here). But how do you get a piece of the action?
The accompanying Booz & Co report suggests that you need to do two things – enhance the shopping experience with e-commerce apps, and enhance the social media experience with shopping apps.
But is it working? To be fair, I admit social commerce has had relatively little impact on sales thus far. Practically every industry player I’ve talked to says the medium is still young and companies are in the experimental stage in terms of its use. According to the report Booz&Co report, that is about to change.
“Consumers will transact commerce— from selecting products to completing purchases through payment with credit cards and points—inside social networks,” states the report.
It’s a “frog in the kettle” effect. People are spending more time on social networks and, invariably, some of their posts will relate to products they purchased or are considering purchasing. Some of their friends will weigh in on the decision, expressing their opinion, and others will be influenced enough by the “follow the crowd” or “follow those you Like” social commerce heuristics, they will make a purchase themselves.
It’s only logical to believe that the more people use social media combined with their innate willingness to share this aspect of their lives will ultimately lead to social commerce becoming a commonplace occurrence. In fact, it already is. The report says that sales via social commerce should nearly double in 2012 to $9 billion (as compared to 2011), with nearly a third of that coming from the US market.
So, what should your perspective be at this stage?
1. Take an optimistic, yet pragmatic view. Borrowing a line from the movie ‘The Grapes of Wrath‘ voiced by ex-preacher Jim Casy, “There’s something going on out there in the west and I’d like to try and learn what it is.”
If Booz & Co is correct in its assertion, there’s something going on at the intersectino of social and commerce, so you might want to pay attention and “learn what it is.” I’m not suggesting that you eat the entire elephant – at least not all at one sitting – but take some time to get informed.
2. Realize social commerce is in an experimental stage. As one industry pundit I interviewed recently said, “the medium is still young most of the companies I know are experimenting with different ways to use it.” There is no uniform template that will work for everyone. Like everything else we learn in life, it’s trial-and-error, at least for now.
3. Understand that consumers will drive adoption. This is not going to come in a top-down direction. Quite the opposite. A polarity shift has occurred in who people trust regarding purchase decisions. (One clue: It’s not marketers or advertisers.) Getting someone to Like your brand’s Facebook fan page won’t be the harbinger of change. Neither will interruptive ads showing up in your newsfeed or timeline. Getting fans to like your products well enough to recommend and share them with friends will.
Let’s not attempt to force social media to be something it’s not – a channel for the use of traditional marketing tactics. Understand the it’s a new paradigm altogether. The more we learn about what causes a person to share stuff, the better we can leverage that understanding to more naturally assimilate this medium into our marketing mix.