Panel – Social Commerce: Can the Crowd Turn Social “Browsers” into Buyers?
While virtual good sales are growing in the social media space, brands are still focused on selling their physical goods. While it’s clear that people are buying online, how are social networks driving sales?
Martin Zagorsek, Principal at Launch Collective (moderator)
Kristine Shine, VP at PopSugar Media
Matt Howland, CEO of Loyalty Lab
Christian Taylor, CEO of Payvment
Dilip Venkatachari, CEO of Compass Labs
Howland noted that social networking extends beyond just Facebook, Twitter, and Foursquare to include this like user reviews. Taylor defines “social shopping” as the practice of getting one’s friends involved in the online experience. Venkatachari explained that these kind of shopping activities do not just increase the amount of money spent in a purchase activity, but it also encourages additional purchase activities that would not have otherwise occurred. Shine described online stores that are centered on social shopping, where users can design looks that they or their friends can then buy.
Taylor talked about selling on Facebook and how search has made social shopping into a game, as users searched for the oddest products they could find (and then shared them with their friends.) Vekatachari was surprised to see that ad conversation on social networks was 30% – 40% than non-social sites, as users are already more engaged with the sites.
In regard to discounting, Howland described it as another tool in the tool box. Taylor offered how Facebook storefronts can build audiences by exchanging discounts for “Liking” a page. Shine describes discounting as “awesome and essential”, but it’s critical to know what you are trying to achieve in the space. Both discounting and premium spend have their place in the social media space. Taylor added that while discounts drive some sales, but exclusivity is another strong driver of social shopping.
Zagorski asked whether online shopping can help smaller, lesser known brands. Taylor noted that newer and smaller brands can use Facebook storefronts to market and sell in a more self-serve platform. Small and medium size businesses are generally early adopters of new social technologies. Howland explained that social shopping is an accelerant, but you still need a good product. Venkatachari added that social shopping helps brands target an audience, selling phone accessories, for example, to recent phone buyers. Shine describes social media as one of the cheapest methods to advertise a product for a small brand, as building pages are free and it allows engagement between the brand and its potential customers.
Howland reiterated that you have to give to get to drive sales through social channels. Shine believes that recommendations are a huge part of the social experience. Social platforms allow for brands and communities to recommend other purchases. Taylor recommends that small brands “act as if”, namely, embrace the exclusivity that is native to small brands’ limited distribution.
In regard to brands that sell both on-line and in-store, these brands found social shopping tools like Facebook storefronts as a tool for customer acquisition. The key is to be consistent between the two spaces so that brands can transfer the in-store experience (which is inherently social) into the social media space.