June 1, 2011Contact: Michael Fasciano, @Fasciano

Social Commerce for MarketersOverview and POV

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Agenda

What is Social Commerce?

The Opportunity, Trends & Examples

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What is social commerce?

A subset of e-commerce that involves using social media contributions and interactions to assist in the online promotion, buying and selling of product in and beyond social platforms.

With HomeGoods making great strides in social media, the time may be right for HomeGoods leverage social investments and grab a greater piece of the digital commerce pie.

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Social commerce is a significant driver behind online retail growth

Social commerce is currently estimated at $5 billion annually

Expected to increase 600% by 2015

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Why pair commerce with social media?

All generations exhibit social behaviors as they shop (right)

Social network users actively discuss promotions, ratings, and the final purchase:

56% discuss product sales and promotions

50% give advice on what to purchase

49% talk about where to purchase products

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Facebook commerce is gaining momentum

8% of brand Facebook pages are commerce enabled

50,000 retailers have opened an F-commerce store

F-Commerce can be executed as a

full-service commerce experience

browser-driven experience that drives to alternate commerce enabled destinations

Key benefits:

Convenient experience

Instant sharing and discussion

Turn-key channel for engagement and promotional opportunities

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AdAge, “Facebook Commerce: A Brief History,” http://bit.ly/pdXgDv

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SOCIAL COMMERCE TRENDS

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Conversation among friends impacts purchase decisions

69% of online buyers find ratings and reviews helpful for making purchase decisions

67% of shoppers spend more online after receiving recommendations from their online friends

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eMarketer, “US Retail Ecommerce Forecast,” April 2011

Implication: Integrate commerce into conversation with friends of the brand

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Transactions are moving closer to the conversation for convenience and engagement (i.e. up-funnel)

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‣Gillette’s extensive shop tab selection allows fans to purchase their favorite Gillette products without ever having to leave Facebook.

Implication: Bring transactions closer to the conversation by initiating on social channels

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Gift giving is a strong fit for engagement among community and friends

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771,383 Likes

Implication: Consider ways in which to make gifts a unique part of the community relationship

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Commerce-primed social channels can deploy turn-key promotions that support revenue generation

• 56% of online shoppers enter a retail-sponsored contest

Gap has given away 10,000 pairs of jeans through Facebook Places’ check-in deals

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AdAge, “Facebook Commerce: A Brief History,” http://bit.ly/pdXgDveMarketer, “US Retail eCommerce Forecast,” April 2011

Implication: Use social promotions to increase consideration for featured social commerce

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Sharing drives more traffic to point-of-purchase

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Levi’s saw 40x increase in FB referral traffic after implementing the ‘Like’ button

Coca-Cola is getting 11% of unique site views from Facebook pages

eMarketer, “US Retail Ecommerce Forecast,” April 2011eMarketer, “Social Commerce,” January 2011

Mashable, “Beginner’s Guide to F-Commerce,” July 30: http://on.mash.to/oba3tb

Implication: Make all transaction opportunities shareable with friends

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LONGER TERM GROWTH OPPORTUNITIES

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Giving gifts to friends can go viral

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The new behavioral targeting: Amex offers deals based on your Facebook Likes

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An up-tick in collaborative shopping is already happening

Wet Seal’s ‘Shop with Friends’ tab increased sales by 20% due to shop tab referrals

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Mashable, “The Beginner’s Guide to Facebook Commerce,” http://on.mash.to/oba3tb

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Social profiles can inform personalized shopping experiences

36% of US online retailers are implementing social sign-on

41% of web users prefer social sign-in to traditional account logins

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eMarketer, “Social Commerce,” January 2011

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Hybrid commerce hosts product browsing on Facebook, but drives traffic to established e-commerce channels

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Review / Discuss Products Make the Purchase On-Site

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Models of F-Commerce to Consider

Facebook initiated selling

Set up a storefront on Facebook for browsing deals, giftcards, product, etc.

The vast majority of brand stores start the shopping process at FB but then jump over to an independent commerce page

Complete selling via Facebook

A transaction process that never takes users away from FB

iFrames vs. Facebook Apps

iFrames allow content hosting in the 520-pixel middle column. Advantage is simplicity

Apps require more development and the primary advantage is more real-estate

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2020

APPENDIX

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Retail e-commerce sales continue to expand rapidly in the US

Online purchasing has become mainstream

In 2011, 179 million consumers 14+ will research products online

83% of them will make an online purchase

eCommerce will continue to grow significantly through 2015 and beyond

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