The document summarizes social commerce (S-commerce), which involves using social media platforms to facilitate online shopping. It discusses four key forces driving S-commerce: 1) explosive growth of social networks like Facebook, 2) increasing time spent on social networks, 3) use of social networks to research products, and 4) merchant investment in social media platforms. It then provides examples of how some merchants are engaging in S-commerce, such as using shopping carts on Facebook, driving sales through daily deal sites, and promotional activities on social media. Finally, it introduces Socialify, a tool that integrates with Shopify to allow merchants to sell directly through their Facebook pages.

1. West Bengal University of Technology associated
Peter. F. Drucker Memorial 4th National Seminar on
“Opportunities & Challenges of Contemporary & Innovative
Management Practices”
Paper Title- S-Commerce- A Fourth Retail
Channel
Author: Koushik Dutta & Anindya Mondal
Student- Bachelor of Business Administration
(Honors)
e-mail Id-koushik.dutta@y7mail.com
anindya.mondal@y7mail.com

2. Social commerce is a subset of electronic commerce that involves using
social media, online media that supports social interaction and user
contributions, to assist in the online buying and selling of products and
services.
More succinctly, social commerce is the use of social network(s) in the
context of e-commerce transactions.
The term social commerce was introduced by Yahoo! in November 2005 to
describe a set of online collaborative shopping tools such as shared pick
lists, user ratings and other user-generated content-sharing of online
product information and advice.
What is S-Commerce or Social
Commerce ?

3. S-Commerce- A Fourth Retail
Channel
The world of social commerce, or as some have described it, the fourth retail
channel.
Four distinct elements define this commerce opportunity for merchants:
a. the explosive growth of social networks, in particular, Facebook,
b. the increasing time that people spend on social networks (at the
exclusion of other activities),
c. the increasing use of social networks for information related to the
purchase of products and services,
d. the investment that merchants are making in elevating their presence
there.

4. First, let’s start with the basics – the growth of social networks, and in particular, the explosive
growth of Facebook. Social networks continue to evolve at a dizzying pace both in terms of the
growth seen in existing sites and in the rapidly growing number of social networks themselves.
Today, roughly 40 percent of all people in the United States use social networks in some form or
fashion, representing 61 percent of all Internet users. Worldwide, 75 percent of Internet users visit
social network or blog sites, a 24 percent increase since last year.
The First Force: The Explosive Growth of
Social Networks
Who are these visitors?
Well, just about everyone! Eighty-two percent of 14-17 year olds and 99 percent of 18-24 year olds
have a social networking profile. Half (47 percent) of Internet users ages 50-64 and one-in-four (26
percent) users ages 65 and older now use social networking sites.
Just what’s driving the popularity of these networks?
Social network membership, by design, is an extension of a person’s interests. People join because
it is an efficient way to meet people like them and stay in touch with friends, colleagues, and people
who share their interests. Once people are there, they find more people who work in the same
place, went to the same school, like the same causes, follow the same music, read the same
books, eat the same foods, etc.

5. The Second Force: Time Spent on Social
Networks
It’s not just that social networks are getting bigger and more pervasive. They are beginning to
dominate time spent online.
Americans spend more than a quarter of their online time on Social networking sites and blogs- a
new study shows.
Social
Networking /
Blogs
Games e-mails Portals
Instant
Messaging
Videos /
Movies
Search
Classifieds /
Auctions
Jun-09 15.8 9.3 11.5 5.5 4.7 3.5 3.4 2.7
Jun-10 22.7 10.2 8.3 4.4 4 3.9 3.5 2.7
Jun-11 30.1 11.1 7.5 4.2 3.8 4.1 3.5 2.8
Globally, it was reported earlier this year that more than 300 million people spent 113 billion minutes
on social networking sites; representing a 20 percent annual growth in audience and more than 100
percent annual growth in minutes from one year ago. The global average time spent per person on
social networking sites is now nearly five and half hours per month, a nearly two hour increase from
2009. In August 2010, U.S. Internet users spent 41.1 billion minutes on Facebook, surpassing
Google’s 39.8 billion minutes for the first time.

6. The Third Force: Use of Social Networks as an Information
Resource
A sociologist would define a community as a group of people who interact and share a common
location. The Internet enables online social networks as the common location where people can
connect with their friends or make new ones – irrespective of physical location. People join social
networks because they want to be part of a connected community. Once there, these members
willingly disclose quite a bit of information about themselves – their careers, education, interests,
hobbies, and even their political and religious interests.
According to Facebook, the average user has 130 friends, creates 90 pieces of content each
month, and is connected to 80 community pages, groups, and events. More than 30 billion pieces
of content (Web links, news stories, blog posts, notes, photo albums, etc.) are shared each month
on Facebook. These numbers continually rise as more people join and interact on the network.

7. The Fourth Force: Merchant Investment in Social
Networks
The Web will be involved in 53 percent of total retail sales by 2014 as consumers increasingly use
the Internet to research products before buying. In fact, roughly 83 percent of U.S. consumers shop
online at least once a week.
When coupled with the fact that consumer recommendations are the most trusted “advertising”
medium for Internet users and time on Facebook (in particular) accounts for more of the time
people spend online. Merchants and their marketers increasingly view it as an important and
convenient sales channel with which to turn fans into customers.
Nearly 100 percent of all major retailers will have a fan page on Facebook by the end of 2010 for
one good reason: Traffic to their own websites is being cannibalized by traffic to their fan pages on
Facebook, and those fans tend to be more willing to buy and advocate on behalf of the brand.

8. Who’s Turning Visits Into Cash?
Although many merchants are keen on the idea of using social networks as
platforms for conducting commerce, only a small number of them actually transact
on those platforms, and fewer still have tapped into the “mother lode” of group
dynamics that these networks can foster. Efforts to tap into commerce in a more
social way fall into three distinct categories:
 Using a shopping cart to facilitate checkout on Facebook.
 Using deal sites off social networks to drive sales at a discount (in
the hopes that deal customers convert into repeat customers).
 Promotional activities on social networks that drive activity to their
existing merchant websites or even physical stores.

9. Using a shopping cart to facilitate checkout on
Facebook.
Payment is probably the most well known of these enablers and uses PayPal as its
payment backend. It launched in November 2009 and claims to have roughly 30,000
businesses and individuals who have used the app, with more than 500,000 Facebook
users who have shopped for products in stores using it. It is a pure-technology play and
provides a shopping cart, the ability to offer fan discounts, a search tool, and the ability
for customers to add comments and reviews. Although technology makes commerce
possible, it still falls to the merchant to promote and engage the social network and
drive traffic to their fan page.

10. Using deal sites off social networks to drive sales at a
discount (in the hopes that deal customers convert into
repeat customers)
Groupon and Living Social are probably the most well known of these social commerce
schemes, although at last count there were roughly 200 “knocks-offs” attempting to
replicate its success. Their focus is mostly services and on the long-tail, local retailers.
These “loss leaders” drive mostly unprofitable sales to local merchants who hope to
convert “trials” into long term customer relationships.

11. Promotional activities on social networks that drive activity
to their existing merchant websites or even physical
stores.
Here schemes abound – including Macy’s Virtual Mirror that enables shoppers to friend-
source product recommendations while in stores – to the Neiman Marcus Midday Dash
promoted on their fan pages to Jet Blue’s weekly Twitter promotions. These marketing
initiatives are mostly one-off efforts to drive a sales spike and are hard both to track and
scale.

12. Socialify – a New Way to Sell on Facebook
Many businesses want to try to sell more of their wares by using various social media sites
including Facebook. But they have to put a lot of time and effort into maintaining their social media
accounts if they are going to make the most of them in this way.
So imagine how intriguing it was to find a website that makes selling on Facebook even easier.
Socialify works in conjunction with Shopify to let you sell products on your Facebook page. This
could make it easier to bring in more sales, as every time someone visits your page they will see
some of your products and perhaps even be inspired to buy them.
You have to sign up for Shopify first, but there are four different options to choose from here. This
enables you to choose the best option for your needs, depending on the size of your business. You
can also enjoy a free trial that lasts for thirty days. Once this is up you will pay the relevant amount
depending on which package you opted for.
The good news is that the system also works with Twitter, giving you greater potential for rising
sales because of how it works. This straightforward system allows you to make the most of your
fans on Facebook. The free trial enables you to see whether it would be worth investing in for the
long haul. If you make enough sales then clearly it will be a good investment.

13. Thank you very much
!