Social commerce: where social media meets e-commerce


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Most of us are acquainted with the terms Social media and E-commerce, however we might not all be familiar with the growing trend of Social commerce, which has generated 30 billion US dollars sales worldwide in 2015 (Statista 2015). According to Handshake.com (2015), it is how engaging in Social media results into online sales transactions. But why exactly is social commerce so important and what distinguishes it from traditional e-commerce?

Nowadays, strolling through a shopping mall whilst discussing potential purchases with a friend is an increasingly uncommon phenomenon. For multiple reasons (time efficiency, lower prices etc.), people have increasingly chosen to scroll through a list of products before adding a selection to their virtual shopping basket. In the process, consulting others experiences or opinion are largely neglected. Separating itself by increasing the social aspect of shopping, social commerce emerges.

Social commerce provides customers with a great deal more than merely a list of products (also known as traditional e-commerce); it promotes social interaction and user contribution to improve products and consult potential customers. Social commerce allows one to explore products in greater depth by engaging with previous purchasers through reviews and comments. Often, companies will provide rewards such as discounts for liking and sharing their product or service, as it will increase the products range.

“Any social commerce shop should have the capability to; share, like, tweet, comment, review and buy on the platform. Because ultimately it’s about getting people talking and sharing and buying.  Anything less is just traditional e-commerce in sheeps’ social clothing.” – Joelle Musante – Payvment

An example is the recently created Coca-cola Store Facebook page. This page allows potential customers to gain information on the brand, purchase the brand and leave comments on the well-known facebook ‘wall’. The page also publishes posts to trigger people to re-visit the page, keeping them engaged and up-to-date. This differs immensely from the original Coca Cola website where one could merely look up company information and purchase a bottle of coke or the company’s merchandise.

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Snapchat of the Coca-Cola Store Facebook page (2015)

Another example is the “Make the flavor – The Battle” – campaign initiated by Lays chips. In this campaign Lays portrays how to involve customers in the creation of a new chips flavour whilst building a large Facebook community. The fact that consumers like to be involved is clear as daylight: 675.000 flavour entries were submitted resulting in additional sales of 6 million bags of chips that made it to the finals (Klein Schiphorst 2012).

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Lays’ “Maak de Smaak”-campaign (2012)

Finally, social commerce increases the value of collected big data. Companies do not only know what people buy but also why they buy it and what their experiences are with the product. This increases the knowledge companies have about their customers immensely.

To summarize, social commerce stimulates social interaction among customers and allows co-creation on social media websites. This distinguishes it from traditional e-commerce. Allowing people to give their opinion on a brand stimulates them to return back to the page, which in return stimulates revenues. During this process, valuable big-data information is collected.

How do you define social commerce? Do you agree on my representation? What is your opinion on the integration of social media and e-commerce? Would you consider it alarming that social media and e-commerce integrate further?

I hope I’ve warmed you up for next weeks topic!


References

Klein Schiphorst, S. (2012). Superfans van Lay’s bepalen de (social media-)smaak. Available: http://www.marketingfacts.nl/berichten/superfans-van-lays-bepalen-de-social-media-smaak. Last accessed 4th Sep 2015.

Reekers, J. (2015). What Is Social Commerce? (And How To Take Advantage Of It). Available: https://www.handshake.com/blog/social-commerce-retail-trends/. Last accessed 4th Sep 2015.

Statista. (2015). Worldwide social commerce revenue from 2011 to 2015 (in billion U.S. dollars). Available: http://www.statista.com/statistics/251391/worldwide-social-commerce-revenue-forecast/. Last accessed 4th Sep 2015.

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3 thoughts on “Social commerce: where social media meets e-commerce

  1. Really interesting blog post! I never knew about the Coca Cola Store page on Facebook. I think it would be cool if clothing brands started to do as well, since I think they will be more popular. I don’t think that social commerce is alarming, especially since it brings forth a lot of new opportunities. I mentioned one in my blog post (The Buy-Button), about how Amazon and Pinterest could possibly work together.

    • There are definitely a lot of opportunities. But I wonder if we should assume all are positive for everyone. As I mentioned on your post: people will be enabled to buy everything everywhere (social media websites AND webshops: why both?). I think we should consider this could have a certain backlash too.

  2. This is really interesting, I never knew that companies could integrate web shops in to social media. For certain social media platform such as Instagram and Facebook it would work for sure. People nowadays are often on social media and that would make it easier to shop online, instead of going to the original website. As you questioned it’s good to think about the fact why and how a company should use online shopping on social media and their own website. A solution could be to only make new collection available on social media, because most of the time people are always searching for the new trends on social media. Thereby you could give a larger assortment on the original website. But also this depends on the size of the company and assortment. It’s a really good topic for the companies to think about.

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