Social commerce is the use of social networks in the context of e-commerce transactions. Some have described it as “social media meets shopping”; others as the use of online interaction to assist in the purchase of products and services. It helps companies engage customers with their brands and provides them with the information they need to research, compare and ultimately select a product. There are, however, many strands to social commerce, as well as the term being open to definition.
“Social commerce tends to be viewed as a transaction that’s facilitated by social networks,” says Andrew McClelland, head
of industry insights at IMRG, the association for online retail. “By social networks we mean social media such as Facebook, Twitter, Snapchat and, increasingly, LinkedIn. Facebook is the one normally associated with retail, but an increasing number of B2B sales are facilitated via LinkedIn.”
“Social commerce is a new mindset that companies must embrace,” says Robert Harles, managing director of Accenture Interactive. “You become a social enterprise using these new capabilities in ways that were impossible a few years ago. Where previously your sense of your customers’ feelings was a snapshot in time, today it’s more like a live video stream. You have a strong handle on their wants, needs, aspirations, hopes and frustrations. This puts a new burden on the company, whether in customer care, sales, communication or marketing. We haven’t fully grasped it yet.”
Right: Robert Harles, managing director, Accenture Interactive
Social commerce and the postal industry
The global impact of social commerce has seen online sales increase, as brands leverage social platforms to further establish relationships with their customers and ultimately drive sales and traffic to their websites. The increased digitization of the economy provides great growth opportunities for posts and postal operators. Traditionally strong in last-mile deliveries, posts are well placed to exploit growth potential by adapting to the changing trends and engaging in new marketing tools such as social commerce to build their relationship with customers.
“By optimizing social channels and using social, search-optimized content, retailers can extend social reach to customers, influence shopping decisions and drive conversion [the process of turning a visitor into a customer],” says Marcelo Wesseler, SingPost’s senior vice president for e-commerce. “Brand loyalty is reinforced when retailers support the customer journey from discovery to after-sales. Social commerce provides early visibility of customer feedback, enabling retailers to align their strategies better to meet business objectives.”
“In a customer-retailer relationship, it is the retailer that owns the contract with the carrier and not the brand’s customer,” comments McClelland of IMRG. “As a result, any interaction between carrier and customer has to be carried out with that in mind. The customer needs to understand that. Carriers are starting to use texts as customer engagement tools to say where they are, if they are going to be late and so on. It could be argued that this is the first step down the social program line.
Postal tracking technology could be viewed similarly. It’s social engagement; it’s talking to customers and letting them know what’s going on. We are also seeing brands engaging through their own social networking presence, having conversations with customers, advising on macro issues such as problems at the depot, technical issues, snow and systems breakdown. This could be scaled up into person-to-person communication.”
According to McClelland there is a debate to be had regarding how far a retail brand would want its carrying agent to go in its own relationship with the customer. “If the retailer forms a contract based on a fairly basic level of service, how far down the road does the carrier go in helping the customer by saying where the delivery is? The retailer hasn’t contracted for that service. There are certainly examples of social media allowing the carrier to have that conversation. The best conversations that are had through social channels are natural conversations where the brand’s ‘conversation controller’ is empowered to make certain decisions without having to keep referring up the chain of command.”
Left: Marcelo Wesseler, senior VP e-commerce, SingPost
Case study – SingPost
While social media is a minor factor behind purchases in the West, it remains the backbone of engagement across much of Asia. Consumers in Asia-Pacific are very active on social media platforms and Singapore is no exception.
SingPost embraces new channels of communication with its customers and stakeholders as part of its transformation from a postal operator to a trusted e-commerce logistics and communications provider.
Through social media, the company provides local and regional customers with 24/7 access to information on its products, services and promotions. This enables customers to make informed decisions when they transact with SingPost and build on the trust they already have in the company.
“SingPost e-commerce works closely with major brands and retailers to develop comprehensive e-commerce strategies, which include initiatives as far as social commerce is concerned,” says Wesseler of SingPost. “Together with our customers, we develop country-specific strategies based on the target audience and the platforms they are more likely to find success in using. We develop key initiatives and campaigns that enable our customers to leverage social media platforms to attract, engage, convert and retain consumers.”
SingPost identifies users who have already responded positively to its brand on Facebook and Twitter, and encourages them to become brand ambassadors. It adds social content such as blogs from relevant stakeholders in SingPost and uses a unified social media management tool to monitor, track and respond quickly to its customers, proactively providing updates on service enhancements through Facebook, Twitter and so on.
In addition, the company has established itself as a thought leader and trusted advisor in e-commerce in Asia-Pacific through the creation of white papers and infographics via the Knowledge Centre on its SP eCommerce website.
“Some of our other social media campaigns include: a collection of Xiaomi phones via POPStations, a one-month campaign that reached 10,000 people and saw over 100 entries from users using hashtags to track Instagram postings; crowdsourcing on Facebook where we got customers to say which e-tailers they would like most to be on POPStations; and finally the use of a messaging app. We leveraged Kakao as a popular messaging app in Korea to drive orders for a brand we manage in the Korean market, using local language and localized social content.”
SingPost tracks customer data and behavior across all channels, leveraging those insights to improve the initiatives it is deploying to work smarter. It uses social listening and measurement tools to monitor and measure social presence, tracking social influenced purchases and measuring the funnel drop-off (the abandonment rate that measures the number of visitors who left a conversion process without completing it). Any promotions or events on social media are analyzed in depth to gather relevant learning from consumer behavior and campaign performance.
“Retailers need to commit time and manpower and deploy social tools and tactics to reap the benefits of social commerce. Failure to do so can lead to lack of feedback control, detrimental viral effects, damaged reputation and the loss of customers,” explains SingPost’s Wesseler.
Social media penetration in Asia continues to grow rapidly, providing further opportunities for e-commerce businesses in the region. The growing adoption of social media will drive opportunities for online business, which will in turn drive traffic and sales through these platforms. The West must catch up if it wants to ride the social wave.
April 15, 2015