Social Commerce Presentation

UK Social Commerce

Overview
What is ‘social commerce’
Drivers of social commerce
E-consultancy’s survey
Figleaves case study

User-Generated Content and Social Media Have Exploded Ratings and Reviews Wikis Social Networks Tagging Blogs Peer-2-peer Facebook

The Next Explosion: Social Commerce
Put simply, social commerce is about customers having the means to interact with one another in order to make better buying decisions.

Factors Driving Social Commerce
A shift in influence from traditional media and corporate speak to people listening to their peers.
Consumers are seen as communication channel
Consumers are authoring brand messages
In effect, working for the Marketing department and generating the message in addition to carrying it.
The consumers have a voice
Consumers now can not only influence purchase decisions, but they can also influence product design
Convergence of stakeholder roles
Consumers are more invested and therefore more loyal to companies and brands

Social Commerce Report Research Methodology
Produced by E-consultancy in association with Bazaarvoice
Surveyed 800 respondents over a three week period (June – July 2007)
360 respondents classified themselves as online sellers
80% respondents were based in the UK

The Current E-commerce Landscape
50% of online sellers say they expect 20% or more online sales growth in 2008*
For multi-channel companies, online accounts for just under a third of all sales*
Online sales in the UK amounted to an estimated £46.6bn in 2007, up from £30.2bn last year, according to the IMRG.
Online sales will reach an estimated £78bn a year by 2010 .
* E-consultancy / Bazaarvoice Social Commerce Report 2007

How are Companies Reacting?
67% say that a social networking strategy is a high or medium priority
More than half of all online sellers (51%) consider UGC as either ‘extremely important’ or ‘very important’ to company strategy over the next year .

Online Sellers’ Adoption and Consideration of Ratings and Reviews
Online sellers that are using ratings & reviews Online Sellers that are considering the use of ratings & reviews Online retailers that rank ratings & reviews as a high or medium priority 28% 52% 80%

What About Negative Reviews? 4.3 out of 5

Importance of Ratings and Reviews to Consumers
Source: UK Consumers, Vizu.com Polls, N=100+ How important are consumer reviews when making a purchasing decision? Would reviews impact the likelihood that you buy from that site? Do you find ratings and reviews helpful when making a purchase? 61% extremely or very important 55% “ Would be more likely to buy” 63% Yes

Benefits of Ratings and Reviews Percentage of respondents rating as ‘major benefit’ (Social Commerce Report 2007)

Case Study
Founded in 1998
World’s largest seller of branded intimate apparel
Carries over 200 brands of lingerie, swimwear, sleepwear and hosiery for women and men
figleaves.com offers a shopping experience that is highly personalised, engaging, fun and backed by an award winning level of service
figleaves.com puts the consumer at the centre of what they do

Implementation of Ratings and Reviews on figleaves.com
Launches Ratings & Reviews Jan 2007
Drive reviews through dedicated landing pages, on-site offers and email campaigns
Customers are engaged – 73 reviews for Fantasie bra
Average rating of products is high – 4.5 out of 5

The Results
Product Coverage
Shoppers on figleaves.com want Ratings & Reviews. figleaves.com has a significant 43.9% product coverage (and growing!)
Review Volume Growth

The Results
The same products with reviews have a 35.27% higher overall session conversion rate.
Conversion was not negatively affected for products without reviews
Overall Average Before Going Live Overall Average After Going Live

The Results
The Look-to-Book ratio is 4X lower (better) for products with reviews compared to those without
Look-to-Book ratio shows the percentage of people who visit a website compared to those who actually make a purchase. This ratio is an excellent measure of ratings and reviews ability to influence the consumer to make a buying decision . No Reviews 11-20 5-10 1-4 21+ 4X

Social Commerce Context Examples

“ This 'social commerce' is creating new and more meaningful ways for retailers to interact with customers. Search, communication and community have the potential to have an even more powerful impact on commerce when closely tied together.”
~Ken Goldstein, CEO of Shop.com

Questions? Linus Gregoriadis, Head of Research E-consultancy.com Email: [email_address] Website: www.e-consultancy.com

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Social Commerce Presentation

by LinusG on Jan 24, 2008

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Social Commerce Presentation — Presentation Transcript