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Together We Buy: The Social Commerce Strategy Playbook

Together We Buy: The Social Commerce Strategy Playbook

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Jon Burg, Senior Social Engineer and Beth McCabe, VP of Social Marketing & Technology, provide insights on social commerce strategy in this exclusive whitepaper from Digitas.
Jon Burg, Senior Social Engineer and Beth McCabe, VP of Social Marketing & Technology, provide insights on social commerce strategy in this exclusive whitepaper from Digitas.

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Categories:Types, Business/Law
Published by: DigitasLBiPerspectives on Mar 15, 2011
Copyright:Attribution Non-commercial

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05/16/2012

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DIGITAS PERSPECTIVE
March
 
2011
 
Together We Buy
The Social Commerce Strategy Playbook
 
Executive Summary 
Social marketing is inseparable from social commerce, connecting consumers in new andinnovative ways with sellers, services, vendors and brands—and doing so through an ever-changing and ever-expanding array of dynamic digital channels.Every social commerce environment is different—there is no one-size-fits-all strategy, andcertainly no one-size-fits-all-
times 
strategy. But one thing is clear: Certain core considerationsand approaches, usually in combination, are already informing every successful social commercesolution. Patterns and expectations are developing—and with them, proven methods.Social marketing and social commerce are intrinsically complementary. Marketing fuelscommerce; commerce without marketing is an unsustainable proposition. Social has begun topermeate every aspect of the digital space, and marketers are joining the conversation—something consumers are coming to expect. As brands map out their social strategies, it naturallyfollows that this should include commerce and all it brings with it: opportunity, growth andrevenue. The right solution at the right time is indispensible—and rarely obvious. While there isno “general case,” this document identifies the foundations of successful implementations, anddescribes the elements and structure to be considered in any particular plan.According to a recent comScore report, nearly one in four Twitter users (there are 15 millionactive accounts) follow businesses to find special deals, promotions, or sales.The story is much the same on Facebook: A study by Chadwick Martin Bailey and iModerateResearch Technologies found that people are 67% more likely to purchase products from brandsthey follow on Twitter and 51% more likely to do so if they follow a brand on Facebook. In fact,53% of retail transactions involving Facebook directly convert from Facebook to checkout(Efficient Frontier).Successful social commerce strategies today point to promising implementations now and in thefuture. The framework for those strategies is contained in this report.
THE WHAT, WHY AND VALUE PROPOSITION OF SOCIAL COMMERCE
What is Social Commerce?
Social commerce (or
s-commerce 
) is
the practice of driving sales or revenue-generating transactions by leveraging the social media dynamic.
 A sound approach to social commerce requires a focus on the occasions made possible by socialmedia for sales or transactions; call it a focus on the “commerce occasion.” For instance, if asignificant number of people in a Facebook community (say, fans of a particular TV show) “Like”a song featured in the most recent episode, some of their friends will click the link (if there is one)and purchase the song. This is a commercial opportunity driven by the social dynamic, and a verysimple example of the “commerce occasion.”
 
 
DIGITAS PERSPECTIVE
March
 
2011
 
While much social media strategy is typically focused on community building, s-commerce strategy is focused on identifying and creating commercial opportunities. This requiresa deep understanding of online communities, the digital space as a whole,technology and its evolution, and social media dynamics and “spaces” as they arise and evolve(and occasionally disappear).S-commerce strategy is not merely a set of tools or even an “appreciation” of the power of socialmedia. It is the purposeful promotion of commercial opportunity as it arises within and because ofsocial media activity.
Why Social Commerce Now?
The use of social media is exploding, fueled by an accelerated pace of technological innovationand adoption. This is challenging traditional business operations and revenue models. Whilesome businesses struggle to keep up, others are riding the innovation wave and enjoyingunprecedented, even explosive growth.One of the differences? Having a solid S-commerce strategy.The marketplace has experienced a radical change, so the players have to change, too, and thatchange won’t happen automatically. It will take foresight, planning and effort. A key element ofthat change is that marketing innovation strategies are now a necessity. They must be tailored tothis new and ever-changing environment. Understanding this takes a new perspective on the newdigital realities of everyday life.Social media has passed a tipping point. It was just an “interesting trend” for only a very shortwhile—perhaps as little as a year or two in the mid-2000s. But today, digital social media is anundeniable part of the commercial landscape, and marketers must engage with it.
Evolution
The past few years of social marketing have largely been about market discovery. Brandsexperimented with a wide range of executions. And why not? There was lots to gain and little tolose. The marketplace was immature. It was yet another “wild west” scenario in the digital world.But now that marketplace is taking shape. Expectations are being set. Habits are being formed.And as with all new markets, standard practices and offerings are being identified, refined andexploited to gain share and revenue. These new market commodities include Facebook brandpages, Twitter accounts, community management, promotions, events, media engagementtechniques, listening and intelligence, and creative development.
The Value Proposition
The value of social commerce is not only profit but also opportunity and positioning toward profit.In an era of unprecedented exceptional hype and extraordinary promise, brands that buildcompelling solutions to consumer needs will be viewed as innovative and relevant to the lives ofconsumers.These satisfied consumers will, in turn, generate new referrals, connecting the brand with morecustomers, and increasing incentives and lowering barriers to purchase for others. For instance,referrals and reviews from peers on high-dollar or high-consideration
 
 
DIGITAS PERSPECTIVE
March
 
2011
 
transactions not only increases a brand’s relevance, but also helps relieve the pre-purchase anxiety.That is,
satisfied consumers cultivate confidence in their peers who are still in the decision- making process.
 These satisfied customers can be considered “brand champions”—evangelists who recruit digital“neighbors” and thus reduce cost-per-lead, often significantly. The excitement and momentumthey generate builds business and supports branding.
The Challenge Today
Social commerce—supported by the right s-commerce strategy—connects social mediainvestment with those new channels of revenue. The challenge is to find the appropriatetechniques to make that connection.Social commerce is no longer a discussion of theories and possibilities. It is a technologicalreality, and an integral part of the future of business. The challenge is not just to find the righttechnology solution, but the right combination of such solutions, matched with the appropriatemarketing, business and communications strategies, and the right creative user experience.So how does a social commerce strategy leverage social media?
SOCIAL COMMERCE STRATEGY LEVERAGES FOUR KEY QUALITIES OF SOCIAL MEDIA 
The concept of social interaction toward some exchange—commercial or otherwise—is old astime. People have been “talking toward a goal” since that first caveman offered to pick up the tabon that first cavewoman’s apple-tini. What’s new is the ease and efficiency with which people cannow collaborate and communicate via digital channels. Our televisions, desktops, laptops, andmobile devices are making our voices and experiences more connected and collaborative thanever before.We can connect with literally anybody, literally anywhere, about literally anything, at literally anytime at all; call it hyper-connectivity. To say that the ramifications for culture and commerce rundeep is an understatement.In the world of business and brands, progress is still an obligation, regardless of the complexity ofthe environment.Hyper-connectivity wields awesome influence. To the careful eye, its key consequences areidentifiable and useful. In order to understand the value of social
commerce 
to the brand andcommunity, we must first identify the value of social
media 
overall to the brand and community.There are four fundamental types of equity offered by social media, and how they are applied in asocial commerce strategy:

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