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Merchants look beyond referrals to drive transactions on social media


There have been numerous predictions around social’s potential to drive commerce sales but with a growing number of merchants adding transactional capabilities to their social media content, this could be the year that potential is finally realized.

Social is certainly an increasingly important way that merchants drive interest around their products and brand as well as traffic to their ecommerce sites but, so far, driving actual transactions from social media has been limited, with some early attempts even abandoned by merchants. However, more recent strategies such as social shopping carts point to the ongoing attempts to make social commerce a reality.

“Social shopping cart is a relatively new concept and technology,” said Nish Modi, vice president of product at SecureNet, Austin, TX. “Conceptually it seems to be a natural extension of a merchants digital and e-commerce strategies coming together.

“However, I believe the social shopping cart works really well for retailers with a dedicated fan following,” he said.

“If you look at statistics, Americans spend 37 minutes on an average on social media sites, a higher time spend than any other major Internet activity, and as retailers figure out ways to be in places where their consumers are, social media is going to play a significantly important role in commerce.”

Blending in
Enabling social transactions has its own set of challenges and opportunities, as the social experience is somewhat unique.
For example, ease of use and accessibility is paramount with social transactions as consumers are typically looking for a quick diversion.

“Consumers won’t modify their behavior to spend money, so interrupting them with advertisements or links to external e-commerce sites is not effective,” said Tyler Roye, CEO and co-founder of eGifter, Huntington, NY. “Instead, the shopping and purchasing experience must blend in with, and even build on, each different social network’s format and its users’ preferred behaviors.


Sephora’s Beauty Board

Merchants should also learn how to effectively harness comments, likes and shares.

“Giving the consumers to tools they need to efficiently garner the options of their friends en route to a social shopping cart can yield dramatic results for the right product at the right time,” Mr. Roye said. “Of course, this can also backfire if the brand’s product is wrong for its intended audience.”

Shopper insights
While one of the promises of social commerce is the wealth of data available about consumers, merchants also need to be sure they are leveraging that data in way that is meaningful – and not creepy – to consumers.

“When it comes to using big data in social marketing, just because you can, does not mean you should,” Mr. Roye said. “Brands need to find a thoughtful way to use social and other consumer data to aid the customer.

“Initiatives that are off-target will feel annoying if not invasive,” he said.

The interest in social commerce is understandable given the growing volume of sales on merchants’ own ecommerce sites that is being transacted by referrals from social media sites. A report from Javelin earlier this year revealed that approximately one-quarter of U.S. social network users have made a purchase on a retail Web site after clicking from a social network.

Research from Acquity Group points to the opportunity to drive those sales directly from a social platform, with 60 percent of consumers ranking convenience in their top two most important factors when shopping on social media and nearly one-third of consumers saying they would be willing to try shopping on a social site. Already, 15 percent have tried social shopping, according to the research.

Twitter commerce
The growing popularity of social commerce in China also suggests this method of shopping is ripe for growth in the U.S.
For example, Chinese microblogging platform Sina Weibo two years ago first enabled users to purchase items from within its mobile apps and has continued to build out the offering based on a partnership with ecommerce company Alibaba.

However, there are still only a few big name pushes into this area.

Twitter has made a big splash in the past year with a couple of big wins on the social commerce side. Last fall, Starbucks launched a way for customers to sync their Starbucks account to their Twitter account to send a $5 digital gift card to someone.

More recently, Amazon teamed up with Twitter to enable U.S. consumers to reply to a product-related tweet with the hashtag #AmazonCart to save items of interest to their account.

Reports also suggest that Twitter is working on a more formal commerce platform.

Social gifting
Part of the problem for merchants is deciding in which basket to put their eggs as there a number of competing social media platforms. 

There are options for adding a social shopping carts on Facebook, which has been adopted by a number of smaller merchants. With earlier efforts to launch Facebook stores were abandoned several larger merchants, the social network is still casting about for the best way to drive transactions.

Pinterest, also looking to play a bigger role in social commerce, recently launched a Gifts feed that only shows Product Pins with pricing and a link to purchase right on the pin.

With a growing number of merchants building out their own social platforms, with commerce an important feature.

Sephora’s new social program Beauty Board, which was launched earlier this year, enables shoppers to upload photos of looks, tag them with Sephora’s products and shop items or add them to a wish list.

One opportunity around social commerce is gifting, which represents between 15 percent and 20 percent of all ecommerce, as it can be easy to insert this into a user’s social media stream.

“Consumers in the digital age spend much of their time on their smartphones, social media, and increasingly, on both simultaneously,” eGifter’s Mr. Roye said.  “The key for retailers looking to break into that space is to stitch opportunities for commerce into the natural stream of social activity.

“This is a challenge but also an opportunity for many retailers, particularly those with a giftable product line,” he said. “These retailers can more easily insert their products into the flow of life events and activity playing out on social networks, such as birthdays, weddings, big announcements.”

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York