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PowerReviews and Forrester Research Present on Social Commerce in New York City on July 28, 2011
 

PowerReviews and Forrester Research Present on Social Commerce in New York City on July 28, 2011

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Cathy Halligan from PowerReviews and Sucharita Mulpuru from Forrester Research present on social commerce at the Hotel Gansevoort in New York City on July 28, 2011

Cathy Halligan from PowerReviews and Sucharita Mulpuru from Forrester Research present on social commerce at the Hotel Gansevoort in New York City on July 28, 2011

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  • Agenda
  • I wanted to share some very exciting news This week, PowerReviews announced the world’s very first Open Social Commerce Network. This means that now ANY brand can join our network, and OPENLY share their customer conversations to any retailer What we mean by open is that we’re inviting ALL brands – even if they’ve built an in-house social commerce solutions. And for Retailers: Means you get more content, more traffic and more sales. This is an important milestone in our company history – and it really marks our commitment to our Founders’ vision to help consumers make decisions by giving them product insights from people like them.
  • illusion
  • Developer led; lean team
  • Zuckerberg quote
  • And why likes are so important; this is odd right…this isn’t interactive marketing…it’s actually closer to personalization
  • Agenda

PowerReviews and Forrester Research Present on Social Commerce in New York City on July 28, 2011 PowerReviews and Forrester Research Present on Social Commerce in New York City on July 28, 2011 Presentation Transcript

  • Social Commerce Trends and More……… with special guest
  • Click to edit Master title style Today’s Agenda Introductions & Announcement Forrester POV – Sucharita Mulpuru PowerReviews POV - Cathy Halligan What’s Next on Facebook – Nadim Hossain Q&A Join us on Twitter: #NYCSocial @NadimAHossain @Smulpuru @CathyHalligan 2
  • NEW Click to edit Master title style Introducing the World’s First Open Social Commerce NetworkNow ANY brand can syndicate conversations across our network “ TechCrunch, July 26, 2011 It’s a simple law of e-commerce: the more consumer reviews there are on a product, the ” more sales will result. 3
  • The State of Social CommerceSucharita Mulpuru, VP and Principal AnalystJuly 28, 2011 © 2009 Forrester Research, Inc. Reproduction Prohibited
  • Social commerce isn’t what it seems
  • AgendaMyths and facts about social commerceA broader social commerce frameworkWhat about Facebook?7 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • The expectations around social are not small8 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Low costs are also tempting9 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • ―Social‖ requires small spend (if it requires anything at all) Source: The State of Retailing Online 2011, a Shop.org study conducted by Forrester Research10 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • But ―social‖ is still largely experimental Source: The State of Retailing Online 2011, a Shop.org study conducted by Forrester Research11 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Sales are not the biggest metric for success12 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Not surprising, even the most generous attribution modeling doesn’t gain much from social 3 1 213 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Agenda Myths and facts about social commerce A broader social commerce framework What about Facebook?14 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Stepping back, ―social‖ means many things15 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • The 8 ―top ranked‖ social tactics 1. Ratings and reviews 2. Microblogs 3. Social recommendations 4. Company blogs 5. Customer generated outfitting 6. Product sharing on social network sites 7. Social shopping aggregator sites 8. Open APIs16 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 1. Ratings and reviews  Already used by most retailers  Opportunity to reduce content creation costs  Benefits to product development, returns and sell-through17 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Seven Key Elements Of Customer Reviews Verify buyers where possible18 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 2. Microblogs Inexpensive to launch Opportunity to quickly dispose of excess inventory Customer service benefits19 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • This also puts a face to a brand20 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 3. Social recommendations  Opportunity to leverage ―wisdom of the crowds‖  Exposes customers to content deeper in the site  Increases time and site and upsell opportunity21 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 4. Company blogs  Provides some opportunity with SEO  Not a huge traffic or sales driver but relatively low cost22 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 5. Customer generated outfitting Coutourious.com  Assists in merchandising support and cross-sells  Engages shoppers in tactile purchases23 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 6. Product sharing on social network sites 10%+ of traffic and revenue comes from social network sources, mainly Much more effective than Facebook and Twitter company social network pages Opportunities to use your customers to evangelize your brand Best with relevant sharing (e.g. local events, sales vs item level communication)24 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 7. Social shopping aggregator sites  Opportunity to drive incremental traffic  Often more engaged and relevant shoppers than traditional CSEs  Conversion is moderate because shoppers are usually earlier in the purchase funnel25 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 8. Open APIs  Opportunity to crowdsource technology  Great for ―shovel ready projects‖26 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Agenda Myths and facts about social commerce A broader social commerce framework What about Facebook?27 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Facebook in particular struggles with being useful in commerce Source: North American Technographics® Retail Online Benchmark Recontact Survey, Q2 2010 (US)28 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • 29 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Yet retailers are not heeding the obvious Current usage and effectiveness of social media tactics Percent Ranking asvery effective 30 © 2011 Forrester Research, Inc. Reproduction Prohibited Base: 68 online retailers Source: The State of Retailing Online 2011, a Shop.org study conducted by Forrester Research
  • Even Facebook tacitly acknowledges this ―When new technologies arrive, it takes awhile [for them] to be embraced…when television was a new medium, advertisers had a hard time figuring out how to use it…the first ads looked like radio ads in front of a video camera…‖ Dan Rose, VP Partnerships and Platform Marketing31 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Why the disconnect?Developers are leading the vision …and Facebook just doesn’t havefor commerce… time to sell a better vision ―We think one of the best ways to stay small is just to stay smaller.‖ COO Sheryl Sandberg on Facebook’s ~3,000 employees32 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • But there’s actually a really interesting vision ―We have this concept of serendipity.—humans do. A lucky coincidence. It’s like you go to a restaurant and you bump into a friend that you haven’t seen for a while. That’s awesome. That’s serendipitous. And a lot of the reason why that seems so magical is because it doesn’t happen often. Bit I think the reality is that those circumstances aren’t actually rare. It’s just that we probably miss like 99% of it. How much of the time do you think you’re actually at the same restaurant as that person but you’re at opposite sides so you don’t see them, or you missed each other by 10 minutes, or they’re in the next restaurant over? When you have this kind of context of what’s going on, it’s just going to make people’s lives richer, because instead of missing 99% of them, maybe now you’ll start seeing a lot more of them.” Mark Zuckerberg, to Time magazine33 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Here’s the execution34 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Personalization itself isn’t all that lucrativeSource: November 2010 “What You Need To Know About Third-Party Recommendation Engines”35 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • But this fuels Facebook’s display advertising model (and why ―likes‖ could be so important) BILLIONS in spite of currently abominable CTRs!36 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • And for retailers this could solve the multichannel measurement conundrum +37 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Think of Facebook this way… Greater value to large retailers Illustration Description Using Facebook data to extract trends, Indirect sales identify influencers, monitor competition, Data layer glean customer insights extraction Example retailers: Zappos Off-―Top and bottom of the funnel‖ Extraction of Facebook’s open graph data Facebook onto key selling pages, ―likes‖ on product detail pages Direct sales Example retailers: Levi’s, Jansport, Wet Seal F-commerce initiatives such as stores, fan On- pages, peer to peer contacts ―within the Facebook four walls‖ of Facebook Example retailers: JCPenney, 1-800 Flowers 38 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • And just to reinforce the role of ―likes‖ “Please indicate which statements below you agree with regarding Facebook as a substitute for email:” (please choose all that you agree with) Source: The State of Retailing Online 2011, a Shop.org study conducted by Forrester Research39 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • As for Facebook Credits, they’re unlikely to extend beyond Facebook  30% commission  Locked with FB now  No one transacts on FB for physical goods  Significant low-hanging fruit for FB with games  Initiatives are develop-led, not FB led (e.g. Dark Knight)40 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Social is many things, but not a silver bullet41 © 2011 Forrester Research, Inc. Reproduction Prohibited
  • Thank youSucharita Mulpurusmulpuru@forrester.comwww.forrester.comTwitter: @smulpuru © 2009 Forrester Research, Inc. Reproduction Prohibited
  • Click to edit Master title style Agenda The case for Social Commerce exists Social is a Net New source of growth Google AND Facebook AND…….. 44
  • Click to edit Master title style 45
  • Click to edit Master title styleA range of social tools in the tool box . . . 46
  • . . . deployed toto editthe intended performance Click drive Master title style Social Social Social Social Brand & Marketing Commerce Insights SupportObjective Increase brand Drive sales through Understand and reputation and interpret the Reduce costs by customer letting customers marketing collective voice to conversation, joint assist other in awareness & drive brand, buying, or game answering support engagement merchandising, and dynamics questions through innovative product social marketing and development engagement decisions Brand Strength & Traffic Actionable CustomerMetric Stature Product level Satisfaction Conversion insights Awareness Cost to Serve Cross Sell/Up Sell Actionable Brand Customer level insights Acquisition Average OrderBusiness Case Emerging Exists Emerging Exists 47
  • Social programming drives to a Click to edit Master title style range of outcomes Brand Marketing Commerce Service (via desk top orOn-site mobile) (via desktop or mobile) Other Networks 48
  • Click to edit Master title styleThe core case for Social Commerce DOES exist Sales = Traffic * Conversion * Average Order• Social content • Social • Social content (reviews, Q&A)on content on increases your site increases your product average order SEO performance page value 20-50%, 25-49% if your increases giving content is indexed conversion consumers by Google directly 15-85% objective on your product based on the information from page star rating people like them• Content distributed and to increase on the social web substance of confidence to increases referral social ‘add to cart’ traffic, clicks back content to your product page 49
  • Click to edit Master title style Do you know?• The UGC quantity you have on your product pages? (e.g. customer reviews, Q&A)• The % of transactions that have UGC? – A baseline is 2% of transactions – Best practice is 5%+ of transactions• Your UGC SKU coverage? – Best practice is 50%+ of your core catalog and 40% of your full catalog• The UGC quantity shared on the social web? And, the referral traffic and resulting conversion? – The value of a review shared to facebook is $15.72 (with a $132 AOV)• Your SEO traffic to your product page?If you don’t know and aren’t managing these metrics, you risk social commerce results 50
  • UGC Quantity & Coveragestyle Click to edit Master title is core to Social Commerce Internet Retailer Top 100Customer Reviews Coverage, % of total SKUs PowerReviews’ Clients 88% 74% 49% 46% 38% 29% 16% 10% 6% Multi Billion $, Multi Channel Retailers Toys Health & Office Apparel Sporting Beauty Goods 51
  • Increase product coverage lifts style Click to edit Master title conversion, resulting in a meaningful sales increase SKUs 75,000 Site Visits 100,000,000 Coverage 10%Product Page Visits 55,000,000 55% SKUs w/o a Review (product pages) 67,500 Checkouts 5,500,000 10% 25% increase in coverage 16,875 Checkouts Completed (orders) 3,025,000 55% Total Product Page Traffic 55,000,000 Traffic to pages w/o a review 25% Traffic to pages w/o a review 13,750,000 Traffic to pages that achieved a 25% increase in coverage 3,437,500 Conversion Lift to Checkouts - 20% increase with 1-2 reviews (assuming 4.2 star aggregate rating) 2% Incremental Checkouts 68,750 % who complete checkout 55% Completed Checkouts 37,813 AOV $ 132.00 Online Sales Increase -doesn’t include impact to Store Sales $ 4,991,250 52
  • Click to edit Master title styleUGC is core in Social Search Google values keyword-rich, publicly available user-generated content: • Wiki Entries • Customer Reviews • Q&A To the PRODUCT Page • Discussion Forums • Twitter and other real-time content Semi-public UGC valued by Google: • Facebook • LinkedIn • YouTube • Flickr 53
  • Click to edit Master title styleGoogle is more ‘Social’ than meets the eye 2008 To the PRODUT Page 54
  • Click to edit Master title styleGoogle is more ‘Social’ than meets the eye January 2010 Innovations but no Social To the PRODUT Page 55
  • Review Quantity edit Master title matter. UGC Click to and Coverage style is a key driver of Google presence Today UGC fully integrated into Google search & shopping To the PRODUT Page UGC Quantity and Coverage key to Google presence 56
  • Review Quantity edit Master title matter. UGC Click to and Coverage style is a key driver of Google presence To the PRODUT Page 57
  • Review Quantityedit Master title style more Click to and Coverage matter than ever To the PRODUT Page 58
  • Social SEO improvement to the product page Click to edit Master title style increases sales Site 20% improvement 10% improvement Site Visits 100,000,000 % visits to product page 55% Product Page Visits 55,000,000 % from SEO 25% SEO resulting product page visits 13,750,000 16,500,000 15,125,000 % continue to Checkout 10% 10% 10% Checkouts 1,375,000 To the 1,650,000 PRODUT Page 1,512,500 % who complete checkout 55% 55% 55% Checkouts Completed (orders) 756,250 907,500 831,875 AOV $ 140.00 $ 140.00 $ 140.00 Online Sales from SEO $ 105,875,000 $ 127,050,000 $ 116,462,500 Online Sales from improved SEO – does not include impact to store sales $ 21,175,000 $ 10,587,500PowerReviews was issued a patent relating to the method in which we deliver user-generated content,enabling our SEO solution. Key word rich UGC is indexed DIRECTLY on the product page by Google, Bing & Yahoo! Work arounds are no substitute for your UGC being indexed directly on your product page Case studies show 25%-40% increase in SEO with PowerReviews vs. an’ I frame implementation 59
  • Previously, sharing with Facebook was a one- Click to edit Master title style way conversation To the PRODUT Page 60
  • Today retailers and brands title integrating Click to edit Master are style Facebook into their on-site experience Facebook To the PRODUT Page profile in the review 61
  • Click to edit Master title styleUGC distribution is core to Social Commerce To the PRODUT Page http://powerreviews.com/facebook-calculator.php 62
  • Click to edit Master title styleSocial Commerce Best Practice Tips To the PRODUT Page 63
  • Maximize User Generated Content style Click to edit Master title Tip #1Product Reviews• Post-Purchase Follow-up Email – Send to online and in-store customers – Send 2nd follow-up email – Test promotions promotion• Supplement with reviews from brands 64 AnswerBox • Add product questions & answers 64
  • Optimize Search Traffic On Site… style Click to edit Master title Tip #2 Amazon Solution PowerReviews Solution: Alternative Solutions: JS In-Line iFrame 65
  • …and Click to edit Master title style in Google Products Tip #2 66
  • Engage in Click to editconversation with a two-way Master title style Tip #3 Facebook.. 67
  • Review posted on edit Master = Click to Facebook title style Tip #3 $15.72 in Sales 68
  • LeverageClick to edit Master title style Tip #4 UGC online and offline Comfortable, walking shoes with 4+ stars 69
  • Click to edit Master title styleListen to your customers Tip #5 70
  • Click to edit Master title style 71
  • Click to edit Master title styleSocial is a net new source of traffic To the PRODUT Page comScore and J.P. Morgan (January 2011). 72
  • Click to edit Master title styleWill Facebook be the next Google? To the PRODUT Page 73
  • Facebook and Google are title style Click to edit Master complementary To the PRODUT Page 74
  • Click to edit Master title style The Catalyst Introduction of the Like Button (anniversaried on 4/21) • More than 2.5 million websites have To the PRODUT Page integrated the like button • 10,000 new websites integrate with Facebook Like each day • Every month, more than 250 million people engage with Facebook on external websites 75
  • Click to edit Master title style The Driver To the PRODUT Page 76
  • Click to edit Master title style What consumers tell us To the PRODUT Page 1 Source: 2010 Social Shopping Study, the e-tailing group/PowerReviews 77
  • Endorsements from Facebook Friends Click to edit Master title style drive sales To the PRODUT Page 78
  • Click to edit Master title style5X Increase in sharing with Facebook Connect To the PRODUT Page 79
  • Click to edit Master title style Evolution of Facebook Integration1-way On Facebook You On Facebook & lightly on-site2-way are(likely) here (Like/share count) To the PRODUT Page On Facebook & Facebook- powered on-site profilesOpen Personalized commerce experience (Facebook + native data) 80
  • Click to edit Master title styleMulti-directional Like Integration 81
  • Click to edit Master title styleFacebook-powered Profiles/Community 82
  • Click to edit Master title styleFacebook-powered Personalization 83
  • Integrate Facebook Connectstyle in a Click to edit Master title now meaningful way 84
  • Click to edit Master title style 85
  • Click to edit Master title style Thank you. @PowerReviews @CathyHalligan @Smulpuru @NadimAHossain To learn more about the PowerReviews social commerce suite, please contact: info@powerreviews.com 86