The cover story in this month’s Wired U.K. takes an in-depth look at social commerce — specifically, its meteoric rise. The article is titled “What are you selling? Big Brands want to cash in on your Facebook friends: Ecommerce is over – Long live social commerce” (not yet available online). The story offers a pretty comprehensive overview of today’s social commerce space, with an eye towards marketer-friendly buzzwords and data points. A few highlights:
• Retail is entering a new phase, in which “product discovery and purchase decisions are informed by the collective and distributed social intelligence of peoples’ social graphs.”
• Flash sale sites (Gilt), group-buy sites (Groupon), and social shopping sites (Polyvore) all rely on a social layer to promote their products.
• Facebook is “leading the social commerce charge” with 1) social plugins that “add a social layer to retail sites” (sharing “likes” and purchases with friends; getting personalised recommendations) and 2) Facebook Deals that “add a social layer to bricks and mortar stores,” by offering exclusive deals and more sharing opportunities.
• Social commerce actually enhances the retail experience for consumers, adding a new dimension to their purchases (ego-shopping, “bragging rights”) and allowing them to make smarter shopping decisions using social intelligence (personalized recommendations).
• Social commerce also enhances the selling experience for retailers by turning “electronic word-of-mouth” into actual sales. All of this adds up: right now, according to the article, 90% of all purchases made are subject to some sort of social influence.
As Social Commerce Daily points out, the article points to conclusions in the book Predictably Irrational by behavioral economist Dan Ariely (who has made several guest appearances on this blog). The ways we as human beings make decisions — about what to buy, what to tell others to buy, etc. — can have a massive impact on retail itself. Blogger Paul Marsden notes: “The practical upshot for social commerce is that there is a real opportunity to hardwire these shopping cues…into the social shopping experience to make desired behavior – purchase and advocacy, more likely.” In other words: retailers, time to hit the behavioral econ books!