This document discusses social commerce and how it relates to e-commerce. Social commerce involves consumers interacting with others during online shopping experiences. Ratings, reviews, recommendations, and referrals provided by consumers can provide value to other consumers and retailers. Social media applications and tools can influence consumers as they progress through the decision-making process. Psychological factors like social proof, authority, and reciprocity also impact social shopping behavior. Best practices for retailers include enabling authentic consumer opinions and making it easy for them to be shared.

1. SOCIAL
COMMERCE
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2. Learning Objectives
 What is the relationship between social
commerce and e-commerce?
 How do ratings and reviews provide value for
consumers and e-retailers?
 How do social shopping applications and tools
affect consumers as they move through the
consumer decision-making process?
 What are the psychological factors that influence
social shopping?
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3. Figure 8.1 Social Commerce
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4. Social Shopping
Social shopping refers to situations where
consumers interact with others during a shopping
event online.
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5. Figure 8.2 Social Shopping
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6. The Decision-Making Process
Problem
Recognition
Information
Search
Alternative
Evaluation
Purchase
Post-
Purchase
Evaluation
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7. Table 8.1 Social Commerce and
Decision Stages
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8. The Marketing Value of
Social Commerce
Ratings and Reviews
Recommendations and
Referrals
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9. Social Commerce Strategies
 Share tools: social software plug-ins that enable easy sharing of
products sold
 on a retailer’s website to social networks
 Recommendation indicators
 Reviews and ratings
 Testimonials
 User galleries: virtual gallery where users can share their
creations, shopping
 lists, and wishlists.This approach is sometimes called user-
curated shopping and may occur onsite or offsite
 Pick lists: lists that help shoppers share what they want onsite,
typically in the form of a wish list
 Popularity filters
 User forums
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10. Best Practices
 Authenticity – accept organicWOM (including
negativeWOM)
 Transparency – acknowledge opinions that were
invited, incentivized, or facilitated
 Advocacy – enable consumers to rate the value of
opinions
 Participatory – encourage consumers to
contribute reviews and ratings
 Reciprocity – acknowledge the value of consumer
opinions
 Infectiousness – make it easy to share
 Sustainability – remember opinions online live on
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11. WOMMA Guidelines for
WOM Marketing
 Educate people about products
 Identify people most likely to share opinions
 Provide tools to make it easier to share opinions
 Study how, when, and where opinions are shared
 Listen and respond to supporters, detractors, and
neutrals
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12. The Psychology of Social
Shopping
 Psychology of influence refers to the factors that make it more
or less likely that people will change their attitudes or behavior
based on a persuasive message.
 A cognitive bias refers to the “shortcuts” our brains take when
we process information.
 Bounded rationality captures the quandary we face as humans
when we have choices to make but are limited by our own
cognitive capacity.
 Information overload is when there’s simply too much data for
us to handle.
 Satisfice means we expend just enough effort to make a
decision that’s acceptable but not necessarily the one that’s
“best.”
 This process of using heuristics to simplify the decision-making
process is sometimes referred to as thinslicing.
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13. Heuristics
 A heuristic technique is any approach to problem
solving, learning, or discovery that employs a
practical methodology not guaranteed to be optimal
or perfect, but sufficient for the immediate goals.
 Where finding an optimal solution is impossible or
impractical, heuristic methods can be used to speed
up the process of finding a satisfactory solution.
 Heuristics can be mental shortcuts that ease the
cognitive load of making a decision.
 Examples of this method include using a rule of
thumb, an educated guess, an intuitive judgment,
stereotyping, or common sense.
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14. Influence and Social Shopping
 Social proof
 When a lot of people select one option (e.g., a clothing
style or a restaurant), we interpret this popularity as
social proof that the choice is the right one.
 As more people jump on the bandwagon a herding
effect can occur. Herd behavior occurs when people
follow the behavior of others.
 Conformity is a change in beliefs or actions as a reaction
to real or imagined group pressure.
 Norms are informal rules that govern behavior.
 Principle of least interest is when the person who is
least committed to staying in a relationship has the
most power because that party doesn’t care as much if
the other person rejects him or her.
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15. Influence and Social Shopping
 Social proof
 Authority: persuades with the opinion or recommendation
of an expert in the field
 Affinity: sometimes called “liking,” means that people
tend to follow and emulate those people whom they find
attractive or otherwise desirable
 Scarcity: is when we perceive something as scarce, we
increase our efforts to acquire it—even if that means we
have to pay a premium for the item and buy it before we
would otherwise have wanted
 Reciprocity: we have an embedded urge to repay debts
and favors, whether or not we requested the help.
 Consistency
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