Posts for December 2011

The rise of social commerce

Social commerce is something often discussed as a natural progression of two successful market arenas — social networking and e-commerce. But with the current forays into s-commerce amounting to little more than adding a Like button or setting up a Twitter feed, the evidence suggests that it’s not yet exceeding the sum of its parts.

The idea of social commerce, or s-commerce, is not necessarily a new one. Consumers have been shopping and having conversations for centuries but only recently have these trends become possible digitally, and only recently have retailers and brands begun to take notice. However, current attempts at using social media to generate loyalty and sales have not offered truly social experiences and have too often led to consumers being pushed onto external sites to interact. Shouldn’t retailers do more to keep their customers on their own websites?  

Giving customers a voice

The growth and popularity of social networking has shown that, when given the right tools, people like to, and do, interact with each other. However, most retailers are not implementing the tools that could see their brands becoming successfully social and engaging with their consumer base. For example, by making reviews and opinions an integral part of the online shopping experience, consumers could be as social online as they are in real life. That is, they could connect online with shoppers of similar tastes in order to influence and be influenced. Brands must put customers first and content second, and stop directing them to other social networks. If customers have a voice, brands must allow it to be heard. 

Keeping it private

Some brands worry about intruding on their customers’ privacy when trying to be more social. While it is important to allow customers to opt in or out, many are happy to share their views and help other consumers make purchasing decisions. Once opinions are shared in public, it is up to the brand to decide how to use them. If they can be harnessed to give the customer relevant and timely recommendations or information, the customer is more likely to have a positive experience. Brands can leave it up to the user to decide what they want to share and when, and information they choose to disclose can be used to provide a more useful social experience.

On-site engagement

Unfortunately, many businesses are still struggling when it comes to s-commerce, pushing customers to external sites like Facebook, rather than engaging consumers socially on their own site.  The result is that consumer interaction with the brand becomes diluted and the brand fails to generate customer loyalty. This could ultimately lead to retailers losing ground in the decision-making real estate that social commerce offers.

If done correctly however, s-commerce can be a profitable way to build brand trust and shopping confidence.  S-commerce provides the perfect opportunity for businesses to communicate directly with their customers, person to person, brand to fan.

Anton Gething is the co-founder and product director of nToklo.

Read more in our section on social media, which has everything from beginners’ guides to in-depth advice.

Is Facebook growth stealing traffic from company websites?

I was recently listening to an interesting talk by Dave Wieneke where he looked at the way brands need to change how they engage with consumers. One of the nuggets he shared concerned the relative importance of company Facebook page visits against their main website visits.

So I dug into the original data — 2011 research from Webtrends and Adgregate (PDF) and it tells a very interesting story that I thought was worth summarising.

For many companies now, particularly those with non-transactional sites, visitor figures are in decline, while their Facebook visitors are growing. This prompts important questions of how serious companies are about creating a strategy to engage their audiences through Facebook and whether they are allocating the right level of resources between website management and Facebook — either too much or too little.

It also suggests questions should be asked about the balance of media investments; whether they should be used to route visitors to the website as traditionally, or to Facebook and other social presences.

And this is an issue for small firms as well as bigger businesses. This is the story this research tells:

1. Visits to the majority of corporate websites are in decline

Looking at the year-on-year change in visits to Fortune 100 sites to 2010, the majority are declining, although of course there are similar levels of growth in others.

2. Growth in Facebook (and other social presences) occurs at the expense of corporate sites

In many cases while corporate sites are declining in their level of unique visitors, Facebook visits are increasing. When it comes to non-ecommerce sites, this trend can be seen in many corporates including Boeing and P&G. Others, including PepsiCo, buck the trend. Of course, this study looks at Facebook only. Traditional website audiences are also visiting YouTube, Twitter and LinkedIn.

3. For some brands Facebook dominates

You’ll know this, but this graphic makes the point forcefully:

In these cases, the dominance of Facebook is likely due to a deliberate strategy to focus investment and marketing resource into Facebook.

This form of analysis is a useful benchmarking analysis to perform for any company sector and for firms of all sizes. You can review your own company’s growth in social media against changes in your traditional website using the many free tools available for benchmarking visitor traffic and social presences.

The results could change the way your business interacts with its customers and they may well shift focus towards social media sites like Facebook.

Dave Chaffey is an expert contributor to Marketing Donut and is the editor of the Smart Insights digital marketing blog.