Online presence has been a requirement for corporate
marketing for many years. Most companies have moved from
brochureware to eCommerce. The next evolution of Web sites has
begun and it is the move to social commerce. With social
commerce, consumers have an unprecedented forum for
communicating with each other and corporate organizations about
their purchases and opinions about corporate organizations.
Web sites are moving from a broadcast medium where
companies distribute information about their products and
services to a social network where customers participate in the
content of Web sites. Social networking services have led to
social commerce where buying behaviours and interaction with
companies are based on interaction with other customers who have
similar interests. This is not only a service for the customers
but provides a company with up-to-the-minute information about
what is relevant to the customer. Online marketing strategies
need to shift along with this change in customer expectations.
Two key themes of social commerce are creating communities and
soliciting ideas from customers.
Word of mouth has been touted as the most effective form of
marketing. Word of mouth can be brought to a completely new
level by bringing it online through a community. Communities
allow the public to post ratings and reviews about products and
have discussions in their areas of interest. Customer reviews
are seen as more trusted than traditional advertising. According
to a global Nielsen survey of 26,486 Internet users in 47
markets, consumer recommendations are the most credible form of
advertising among 78% of the study’s respondents.
Are you afraid to let people publicly post about your
company? They are going to do it anyway. Participating in the
process openly helps ensure all the facts are presented. From a
public perception standpoint, employing corporate transparency
can work in your favour. Do not just be the subject of
discussion, be a part of it. When it comes to positive
endorsements and commentary, you want them to be public. You no
longer have to hassle people to provide endorsements. They can
be communicated directly to others without interference. Not
only that, because people have posted of their own free will,
their message is more believable and therefore more impacting to
other people visiting the site. Negative reviews can actually
result in a positive benefit.
Negative reviews establish authenticity. If all comments were
positive and rated 5 out of 5 it would be hard to believe.
Consumers look for negative comments to ensure they have done
their due diligence on their shopping and that they have made
the right purchase.
Monitoring of communities can be automated as well. Business
Intelligence techniques such as text analytics can automatically
monitor what is being posted. Common features of text analytics
include the following:
Classifying posting as positive, negative or neutral;
Grouping similar postings together; and
Detecting postings with key words or phrases.
The combination of customer postings and text analytics
provides a social networking platform that gathers important key
information about what people think of your products or of your
company. Since people identify themselves when they post, you
see which customers are your biggest fans and which need to have
issues addressed.
Blogs are a common way to implement a social network. A blog
is implemented on a Web site and is usually maintained by an
individual. Periodic entries of commentary, descriptions of
events, or other material such as graphics or video are posted
to the blog. Often people can comment on the blog postings.
Royal Bank of Canada has launched a blog web site called “RBC
p2p” (http://www.rbcp2p.com). It is a blog community set up for
the specific purpose of helping students with money. The pitch
is “for students, by students” as students publish the only
content on the site. By hosting the community, RBC has aligned
themselves with the image of being open, helpful and current
rather than the traditional view of a bank being impersonal and
unfriendly.
Customers are also a very powerful resource for contributing
to the future direction of a company. In the book, The Wisdom of
Crowds by James Surowiecki, the author discusses "under the
right circumstances, groups are remarkably intelligent, and are
often smarter than the smartest people in them." The specific
circumstances he discusses are that the crowds need diversity of
opinion, independence of members from one another,
decentralization and a good method for aggregating opinions.
Social commerce provides an environment that meets all these
conditions. Some corporations have realized this and are now
harnessing the collective wisdom of their customers to drive
change to their products and companies.
Starbucks has adopted this strategy with
http://mystarbucksidea.com.
Here you can post your idea about how they can improve their
products or stores. The public vote on them and the most popular
ideas bubble to the top. Internally, Starbucks staff reviews and
responds to them. The idea categories are divided into Product,
Experience and Involvement. Some of current suggestions range
from how to be more environmentally friendly to new product
ideas.
Most recently, Jeff Howe has documented this phenomenon in
the upcoming book Crowdsourcing: Why the Power of the Crowd Is
Driving the Future of Business. Jeff defines Crowdsourcing as
"the act of taking a job traditionally performed by a designated
agent (usually an employee) and outsourcing it to an undefined,
generally large group of people in the form of an open call."
Technology is not the barrier to social enabling a Web site.
There are packaged software products and services available,
which make it relatively easy to deploy. The challenge is the
cultural shift of how you interact with your customer. It opens
a completely new level of trust between a customer and a
company. The very first step is to overcome the fear of changing
your interaction with the customer.
It is important to provide incentives for people to interact
with your site. Providing loyalty points for contributing is one
strategy. It is amazing that simple recognition of contributions
is a motivator. The web site
www.torontogasprices.com takes contributions from people for
posting gas prices in the GTA. The reward people get is simply
that the more postings they make the fancier the car icon beside
their name.
If you are ready to incorporate social commerce into your
marketing strategy, you should take the following steps:
Establish a corporate culture that embraces the
customer’s opinion and is not afraid of having it viewed
publicly;
Decide on the priority within your organization for a
social community. Is it a forum for product ratings and
discussion, or letting people suggest ideas;
Evaluate products on the market that support social
commerce; and
Build a marketing program that that encourages people to
contribute to your Web site.
Craig McQueen is Director of Business Intelligence Solutions.
He can be reached at:
or 416-304-1338 x19.
