So, Twitter and Facebook have both had makeovers for their brand pages, Pinterest has marched authoritatively onto the stage, and Google+ is up to 170 million users.
What’s happening in the world of social commerce?
The broader online retail metrics point consistently upward. In the UK, in March 2012, consumers spent a whopping £5.8bn, a 14% rise year on year. M-retail (mobile) has grown 300% year on year – tablets are making a big impact – particularly as a research and comparison device.
Interestingly, of the £142.27bn UK consumers will spend, social commerce platform Gloople say £5.67bn can be attributed to social commerce.
In ‘direct’ commerce terms, online retailers with a Facebook-enabled checkout remain very low in penetration – just 4%. Perhaps more surprising is learning that just 17% of Facebook pages feature any products at all.
But putting a figure on the real role of social inonline commerce is extraordinarily difficult. It’s significant. Looking across a classic buying cycle paradigm, there are arguably few, if any stages where social does not have a potentially important role to play.
The ‘social login’, that is, being able to log into many 3rd party websites using Facebook, Twitter and others, could be key to social’s growing role in commerce. It is seen as crucial to lowering the abandonment rate of online shopping carts. A not-insignificant 40% of US consumers say they prefer to connect with brands via Facebook, as opposed to registering to sites separately.
And social logins could also play a crucial role in the development of Facebook Credits for example, as users, already logged in, become seamlessly enabled to make one-click purchases.
Will we ever use Facebook Credits? Well, they’ve been quietly around since 2009. It seems incredible that despite fewer than 2% of users actually spending Facebook Credits, they already account for $557m in Facebook’s revenue – that’s 15% of its overall 2011 revenue!
What’s more, TechCrunch believe that since Facebook are now public, they’ll begin to promote the Credits more aggressively – bringing them outside of the social gaming vertical and far further afield. Couple that with Facebook’s ability to offer Credits at various rates – say, £1 for £3-4 worth of the Credits – and we can start to see how it may kick-off rapidly. And brands will be able to operate similarly. GAP UK, for example, offered 5 free Facebook Credits in exchange for a Facebook Like, and the user’s email address – a solid way to build CRM.
And Social Commerce has a significant role to play in search & discovery. One dynamic that drives Google, Microsoft and Pinterest in search & discovery is the important role of trust among our peers. Indeed humans trust recommendations from people we know 90% of the time. And as is well documented, shopper reviews are used by as many as 77% of us.
And Facebook apps such as Glimpse play a potentially important role in search & discrovey. By identifying and collating the most ‘liked’ products on the web, we have unprecedented assistance in purchase behaviour.
We are moving to a world where we are all e-billboards, and we are e-sales people. Ensuring a smart and flexible online strategy is vital.
We saw in technology bulletin 0020 that Pinterest had driven more traffic to websites in February than Google+, Twitter, LinkedIn and YouTube.
US clothing retailer Boticca.com just announced that its Pinterest Board users were spending more than twice as much as comparative Facebook users ($180 v $85), and their board is driving higher numbers of new users. Yet Boticca.com noted that their Facebook users had a higher conversion rate. This goes some way to demonstrating the importance of a carefully nuanced online social commerce strategy.
And we expect more significant changes in the near future. Facebook’s recent acquisitions of Tagtile and social gifting app Karma both demonstrate that it has big designs on the future of social commerce. They understand its potential only too well…