Michoel is Director of Platform and Product Strategy at Big Fuel, a social media agency. He is also an adviser at Social iQ Networks and VideoGenie and a frequent speaker at social media technology conferences and events. You can follow him @Twabbi.
In 2010 Mark Zuckerberg said, "If I had to guess, social commerce is next to blow up." He was right. Social media has changed the way we shop online, and the statistics confirm it. About 81% of consumers receive advice from friends and family relating to a product purchase through a social networking site. And the majority — about 74 % — of consumers rely on social networks to guide their purchases.
But the shift from e-commerce to s-commerce has only just begun. Revenues for the social commerce market are expected to reach $30 billion by 2015. This is due to multiple factors, including consumers spending more time on social networks, brands targeting consumers in the news feed (as opposed to fan pages) and advances in technology, such as mobile geo-location shopping apps and enterprise marketing tools.
But who's vying for this space and what are they doing right? Here are four startups that are making e-commerce social in revolutionary ways.
1. Extole
Big Idea: Extole leverages the power of advocates at multiple touch points to enhance social commerce.
How it Works: Extole is turning one directional marketing on its head. Headquartered in San Francisco, the company is a consumer-to-consumer marketing platform that taps into the power of customer advocates to foster trusted word-of-mouth stories about a brand.
Advocates are targeted at key touch points such as Facebook fan pages, confirmation pages, account pages and dedicated emails. Then the advocates are invited to participate in a branded experience and are rewarded for social sharing. That, in turn, drives awareness and sales. Below is an example where Folica.com invites consumers to participate in a campaign.
2. 8thBridge
Big Idea: 8thBridge makes it possible to shop items found in stream on a site like Facebook.
How it Works: 8thBridge, head-quartered in Minneapolis, makes it possible for customers to shop where they socialize. Social Expressions, one of the company's social apps, turns shoppers into advocates by making it easy for them to more specifically express how they feel about products and offers. For example, instead of 'liking' a product, consumers can now 'want', 'love' or 'own' the item of interest.
When people share a brand's products with their friends, Graphite converts them into "Shoppable Stories." The product appears in a friend's ticker and timeline like a video does, with a thumbnail image and a play button.
According to 8thBridge, Facebook users are 18 times more likely to engage a "Shoppable Story" than a link because links mean leaving Facebook (and who wants to do that?).
3. Chirpify
Big Idea: Chirpify taps into Twitter to stream social commerce — without devices or cards.
How it Works: While 8thBridge enhances s-commerce in Facebook, Chirpify takes e-commerce directly to the Twitter stream.
Chirpify turns tweets into transactions, enabling consumers and businesses to buy, sell and donate on Twitter. For brands the process is simple. First, create and tweet your offer with a product image. Second, shoppers reply with the word 'buy.' Third, once the customer registers with Chirpify, the transaction is automatically processed and the order is fulfilled. Customers can connect their PayPal account so the money is automatically deducted as they shop.
Below is an example of an organization using Chirpify to enable donations directly within their Twitter stream.
4. LocalResponse
Big Idea: LocalResponse mines consumers' intent-based social broadcasting (such as check-ins) and in response provides real-time offers on mobile devices.
How it Works: LocalResponse, headquartered in New York City, is a social advertising platform that aggregates public posts and 'check-ins' across multiple platforms to help brands and businesses identify intent and respond to it. Brands and agencies use LocalResponse to leverage real-time inventory for mobile activation.
The platform embodies social, local, and mobile. Social by checking-in and broadcasting one's location, local by helping a national brand marketer reach someone on a local level, and mobile by converting people on their mobile device.
What makes LocalResponse unique is their declarative data set. Targeting data, such as, behavioral, demographic or contextual is usually approximated. LocalResponse's platform is able to identify where someone is, when they are there, and what they are saying about it. Marketers act on the consumer's real-time intent by converting people with exclusive offers or coupons via mobile at point-of-sale. Here's a diagram that outlines this process.
These four startups are just the tip of the iceberg. As e-commerce becomes increasingly social, we will see dramatic changes in the way we think about our online shopping. Imagine this scenario: The cookie dough ice cream is running low. A microchip embedded in your freezer and connected to your Facebook account alerts you via Siri: "Your Haagen-Dazs chocolate chip cookie dough is running low—your friend Seth is a fan of Ben and Jerry's on Facebook and praised Chunky Monkey in a Tweet. Shall I order you a pint?"
Image courtesy of iStockphoto, andrearoad
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