Is it really coming to this: social commerce = pay-for-share?

April 13, 2011 by George Eberstadt

I now count 6 start-ups offering tools that enable online stores to pay their customers for posting to Facebook about the things they’ve bought.  The flavors and features vary, but pay-for-share is the core mechanism for all of them.

The model that seems to be getting most traction looks like this:

1. Offer the customer a discount for posting news of their purchase to Facebook (and Twitter).

2. Assure the customer that by posting they are also providing a discount to their friends. (With some of these tools, I’ve been unable to figure out how the friends actually get their discount, but that’s probably a failure of my research…)

It’s essential to provide both discounts to maximize sharing.  If the store provides a discount only to the customer, she feels like a shill for promoting the store to her friends just to get a discount for herself.  But if she feels like she is providing her friends with a discount, too, then she can share away to get her own discount guilt-free.

I get the appeal of this model to stores as a way to reach new customers through Facebook, but I don’t get the economics.  Isn’t “paying” your customers to share discount offers with their friends an expensive way to get offer distribution?  Presumably, the customers who sign up are those who plan to use the discount they get for sharing, so the incremental sales / new customer acquisition / many-coupons-expire-unused arguments don’t apply (at least not much).  One store using this tool offers a customer 25% off on their next purchase of $65 or more to share about their purchase on Facebook – so a minimum cost to the store of $16 in lost margin on a future sale.  Say we cut that in half for incremental sales / expired-unused effects.  That’s still an $8 min cost per post.  And the most aggressive estimates I’ve seen of the value of a purchaser-post on Facebook are $2-5.  So that doesn’t work.

On the other hand, if my calcs are wrong, and the economics of pay-for-share really do work, and the model becomes wide-spread, what will this mean for Facebook et al?  Will they have to enforce disclosure rules?  Do paid-for posts harm the community, or only (if discovered) the reputation of the poster?

Hey, if this model proves out, we’ll probably add it as an option in our Social Commerce Suite, too.  But what I’m really hoping is that, in the end, social commerce will be about people sharing with each other just because it’s helpful, not because they’re paid to.

Video of Tuesday’s FastPivot-TurnTo webinar: Social Q&A for eCommerce

April 1, 2011 by George Eberstadt

Here’s the full video from our webinar on Tuesday with our partner and leading Yahoo Store design and development shop FastPivot.  It’s about an hour.


Full price is dying. Social is the perp.

March 25, 2011 by George Eberstadt

As discussed in a couple recent posts (one, two), it’s much harder to get people to share purchase-related information than other types of personal news and content.  And the type of sharing you can get people to do in bulk (“contextual sharing”) is more limited than the broadcast-to-all-your-friends type that most merchants dream about.

But there’s one big exception: discounts!  Discount offers and social are a perfect symbiosis. Access to deals is the #1 reason people fan brands on Facebook (driving brands to offer more deals to get more fans).  Deal-a-day services (Groupon, LivingSocial) and private sale sites (Gilt, Rue La La) owe much of their explosive growth to the eagerness with which members share their deals.  And new services like CureBit and SocialFeet have realized that even paying customers to share purchase news with their friends doesn’t work unless you also give those customers a discount offer to share with their friends at the same time.  In a nutshell: social networking is driving discounting to levels never seen before.

But how far can discounting strategies go before full-price has no meaning any more?  Discounting has always been used in a limited way to bring in new customers and as a price-discrimination tool.  (Clipping coupons is a pain, so only people who care more about the savings than their time did it.)  But those uses of discounting are only affordable to merchants when the bulk of sales remain at full price.  Also, most customers don’t mind paying full price if just a few people, for special reasons, got a discount; but no one wants to be the only jerk who paid full price when most others got a discount.  With too much discounting, the full-price-with-occasional-discount model breaks down, and everything has to be sold at a discount.  And then the discount price has to be raised to preserve margins, so the full-price price becomes a meaningless number no one would consider paying.  And that sort of price confusion is paralyzing to buyers.

Clearly, the discount tsunami is still coming in – no one knows where the high-water mark is going to be.  But in this environment, we think it’s more important than ever that merchants continue to explore tools that help them grow without compromising margins and not just get swept along in the discounting frenzy.

What works in purchase sharing

March 17, 2011 by George Eberstadt

Last month, I wrote about the challenges of social commerce – in particular, why it’s so hard to get people to share purchase-related information.  And I promised I’d follow up with a more optimistic post about an approach that’s working.  We call this “contextual sharing”.

Try this: Ask a random sample of people how they feel about telling their friends about recent purchases.  Most of the people you ask will probably give you an answer like this: once in a while they’ll tell some friends about some purchases, but the idea of mass-sharing their purchases is repulsive.  Now ask them how they feel about answering questions about their purchases.  You’ll probably get a very consistent response: sure, I’m happy to help; in fact, I enjoy sharing my experience.  Now try a 3rd question.  Ask these people if they’d be willing to let people who are shopping for items like ones they’ve already bought know that they are available for advice, if needed.  The answer will probably sound like this: as long as I’m not broadcasting about my purchase in a spammy or self-promotional way, sure.

This is the big idea behind contextual sharing: people will share purchase-related information when they have confidence that it will be relevant to the audience.

If you sell online, this has huge implications for your sharing strategy.  Don’t over-reach by trying to get your customers to mass-share.  Instead, start by asking for contextual sharing.  You’ll get a much higher sharing rate, and you can always put the request for a mass-share at then end, to catch that small % of customers who will participate.

Here’s some data from our experience running the TurnTo Purchase Sharing application, which uses a contextual model, on several dozen websites spanning a broad range of verticals for over a year. The system opens an overlay box on the order confirmation page (ie immediately after purchase) that looks like this:

15% of customers click “Sure” (!!).  Then the system asks for an answer to the question “Why did you choose this?”

About 1/3 of the people who clicked “Sure” also add a comment.  That means that about 5% of all items purchased are getting one of these check-out comments attached, along with permission to show that comment to other shoppers. Finally, the system offers shoppers the opportunity to post that comment to Facebook and Twitter.  The rate there is much lower.  But by having asked first for the contextual sharing permission, the store at least got that.

A webinar just for Yahoo! Stores: Social Q&A for eCommerce

March 14, 2011 by George Eberstadt

For Yahoo! Stores

Join us and leading Yahoo Store services provider FastPivot for a webinar on:

Social Q&A for eCommerce

Tuesday, March 29, 2011 2:00 PM – 3:00 PM EDT

Register here

Question-and-Answer systems are one of the hottest topics on the social web. Now learn how to use Social Q&A on your store to increase conversions, bring past customers back, improve your SEO rankings, and drive fresh traffic from social networks.

The goodwill of your customer base is the #1 asset of your business. Don’t leave it locked away. Adding Social Q&A to your store can release this untapped goodwill to generate more sales by connecting your shoppers directly to your customers.  That’s what makes it “Social” – this isn’t just another customer service tool; this is a level of community engagement you’ve never seen before. Results include: – Shopper questions about popular items typically receive 3-6 answers from customers within 24 hours – 80% of these questions receive their first customer answer within an hour or two – 7% of past customers receiving a shopper question email return to the store to provide an answer – Shoppers who engage with Q&A convert at a massively higher rate – as high as 7X the baseline – Often  produces more user-generated-content (UGC) than customer reviews with attendant SEO benefits During the webinar we’ll walk you through a number of live examples of Social Q&A in action on Yahoo! Stores. Register here


How to Leverage Social When Visitors Are Shopping Onsite?

February 27, 2011 by John Swords

This is a reprint of a guest post I wrote for ZippyCart, originally published there on February 22.

Beyond marketing and customer service, Social has the power to help convert visitors on retail sites. A large majority of online retailers today are using at least one of the most popular social media platforms: Twitter, Facebook, and YouTube. These platforms have been used for brand marketing and customer service. Retailers are beginning to explore their utilities as sales tools. When it comes to selling, these platforms are in essence today’s equivalent of shoppers signing up to direct mailing lists. Shoppers give retailers permission to reach out to them and share information. Shoppers allow retailers to reach out to them directly, by following retailer tweets and Facebook wall postings, and indirectly through their friends in the form of retweets, friends’ postings, and friends’ likes.

Reaching out to shoppers through Facebook and Twitter, much like direct mail to shoppers, works at the wide end of the sales funnel. If successful, it draws the shopper into the store, with a buying intention. It drives traffic. Most online retailers stop there. When they do so, they leave a lot of value on the table, the value of utilizing the power of social beyond traffic, as the shopper is moving along the sales cycle- browsing products, seeking further information and insight about products, and adding products to the shopping cart.

When a shopper is going through your online store, you should let the collective social wisdom and experience of your entire customer base help them complete the sale. This can be done in a number of ways, according to where the shopper is along their decision making progress.

A new visitor might be hesitant about buying from your site. They read copy on your site that is at its core a set of claims and promises, and they need to decide how much they can trust your editorial voice. A likely question going through their mind at this time is “do other people trust this site?” “do other people shop here?” “do I know anybody personally who has already bought at this site?” You, the retailer, can help by letting the visitor see other real people who shopped on your site before. You can earn extra trust points by providing visibility into people in the shopper’s zip code, or in the shopper’s circle of social contacts, without, of course, ever going beyond the level of visibility such people had authorized.

With a comfort level in the store that’s high enough, shoppers are ready to start considering your products. As in physical stores, some shoppers come in to browse, while others walk in with more specific product buying intentions. Browsers tend to be socially curious about what products people are buying around them. Some online retailers help these browsers with a display of the best selling items. Another way to support the browsers’ product discovery phase is by letting them see what other individuals recently bought. This can be done digitally in a socially convincing way, without breaching any shopper’s privacy – you can show initials of shoppers, profile pictures of those who joined your “customer wall”, and full identities of social contacts of the shoppers that have opted in to be there for their friends. Emitations, a leading retailer of silver jewelry, displays a “see what your friends bought” button on its home page, its category pages, and all of its product pages. Visitors to Emitations who interact with the button convert at a rate that’s more than 5 times higher than those who do not.

Next, and only one step removed from the shopping cart, your shopper might have product specific questions. Retailers provide an array of resources here, from details product information, product images, through how-to videos, to live chat that chimes in when it’s clear the shopper needs advice. All this might not be sufficient in such cases where the shopper is not looking for hard factual data, but for a color commentary from others who have used the product. Ratings and reviews have been added in recent years as the first layer of social input by the individual item. Recently some retailers have gone one step further, and empowered their shoppers to reach out to the broad social circle of product owners, and ask product specific questions. Answers to these questions provide buyers with social insights that cannot be gleaned from product information, ratings and reviews alone. One such retailer is Club Furniture that added an “Ask people who bought this” button on their product description tab. Club Furniture’s tool allows shoppers to reach out to the retailer’s entire customer pool, with questions that are best answered socially such as how comfortable a piece of furniture is, and how it wears. 13% of ClubFurniture’s customers who receive a shopper’s question answer it. (This means that a question which is sent to 40 customers will receive, on average, 5 responses.)

Embedding such social tools within an online store lets you harness the power of social beyond driving traffic, and throughout all key decision points along the on-site buying process.

Why Social Commerce is so hard

February 2, 2011 by George Eberstadt

I was recently on a Social Commerce panel (photos here) for Social Media week hosted by Digitas in NYC.  (Thanks Beth McCabe, Noah Mallin, Jonathan Burg, and fellow panelists Matty de Castro of Facebook and Bob Tuttle of 8th Bridge!).  One of my fellow panelists put up a screen shot of the Levi’s Friends Store as an example of Social Commerce and provided an opening I couldn’t resist.

Look in the lower right: Levi’s has 2.9m Facebook fans.  That’s 2.9m people who have agreed to allow Levi’s to send them messages in Facebook.  Not bad!  Now look at the Original 501 Stonewash jeans.  450 people have liked this.  Only 450 people.  How many people do you think own these jeans?  And Levi’s Friend Store was Facebook’s poster-child ecommerce partner when they launched the Like button.  In fact, for several months, Levi’s entire online store was the Friends Store.  (Even now, the Friends Store is one of the main menu options.)  So it’s not like the feature was hidden.

Thank you Levi’s for providing such a clear illustration of the main challenge of Social Commerce.  What’s working well for Levi’s is leveraging Facebook to enable dialog between the brand and their customers.  That’s the 2.9m fans.  But that’s not Social Commerce, it’s Social Media Marketing.  Social Commerce is encouraging commerce-related conversation between customers.  That’s what the Like button next to the individual products is for.  That’s the 450 people who have Liked the 501 Stonewashed.  And that’s what’s not working.  (You can define the terms differently if you like – I don’t really want to provoke an argument about definitions; the distinction between customer-to-brand vs. customer-to-customer is what’s important.)

Why is it so much harder to get people to share product and purchase information with each other than it is to get them to accept marketing messages from a brand?  The biggest reason is this: the stigma against shilling has not disappeared just ’cause now we share on social networks.  Any time a statement can be (mis)interpreted as “trying to get your friends to buy something”, all sorts of alarms go off.  Not to mention all the other baggage that goes along with sharing on wealth-related topics.  (She can afford that?!  Is that the best he can afford?!)  Content sharing on social networks has been a runaway success.  But when the subject of the sharing is product/purchase/commerce, the sharing rate falls off a cliff.  (Acknowledging some exceptions: discount offers, especially deep ones, get shared.  And commerce objects of exceptional interest get shared – I’d argue that this is better understood as content sharing, tho.)

Does this mean that if you sell stuff, you should forget about trying to connect your shoppers and your customers with each other?  No way.  You can try the discount-offer and too-cool-not-to-share end-runs.  You can even go the full-on viral content route where your brand/product message is just a low-profile passenger.

Or you can try a radically different approach we call Contextual Sharing.  More on that in a later post.

Next TurnTo Webinar: Beyond Facebook “Like” and Twitter

September 19, 2010 by John Swords

You’ve implemented Facebook “Like,” have a fanpage, post on Twitter, but haven’t seen a real return on using Social Networks?

Register now for TurnTo’s 45 minute Webinar taking place on Wednesday September 22nd at 2:30PM Eastern.  We’ll take a look at how you can increase conversions 2-5X above your baseline by providing your shoppers with a way for them to connect with people they know and other shoppers directly in the shopping cycle.  See why over 50 online stores have implemented TurnTo’s powerful and lightweight Social Commerce Suite.

Simply email to register and we’ll send details on the upcoming webinar.

We look forward to seeing you at the webinar!

Social Commerce insights from the TurnTo – FastPivot webinar

August 27, 2010 by George Eberstadt

Together with our partner, leading Yahoo Store builder FastPivot, we produced this webinar on Social Commerce strategies on Wednesday.  Here are all the slides plus the complete audio (controls are just under the slides). Thanks to the many attendees! The

FastPivot part runs through slide 35.  They provide a broad overview of social media marketing packed with actionable recommendations.  Starting at slide 36, we do an 18 minute discussion of Onsite Social for e-Commerce.  If I do say so myself: it too is insightful and practical.  Enjoy!

View more webinars from FastPivot.

The “Right Time” Web and Social Commerce

August 21, 2010 by George Eberstadt

I gave this presentation at the MIT Enterprise Forum of NY a year and a half ago.  The NY Times Bits blog piece today on comments by Venrock’s Brian Ascher about the “Right Time Web” made me dust it off.  I tidied it up a bit (but not much).  My predictions about the imminent arrival of the “Trusted Reference” model in the e-commerce world were at least a year too soon – I left those unchanged.  (Brian’s colleague David Pakman also blogged about this in the spring.)

Amazon links to Facebook for on-site social commerce features – other stores will surely follow

July 28, 2010 by George Eberstadt

Amazon has just hooked up with Facebook to add social shopping features powered by the shopper’s Facebook friends list.  (NY Times article. WSJ article.)  My guess is that this will prove to be the watershed moment for social commerce.  Where Amazon leads, others follow.  Amazon pioneered customer ratings and reviews, which are now found on commerce sites across the web.  Amazon pioneered community cross-sell tools (“customers who looked at this also looked at that”, “customers who bought this also bought that”), which are now provided to online merchants by at least half a dozen vendors.  And while Amazon may not have pioneered the integration of 3rd-party social graphs into online stores (we’ve been at this for a few years), the ecommerce world is likely to take its cues from Amazon in this area, too.

Here’s what it looks like on my Amazon profile page:

And this is just their initial feature set; lots more must be just around the corner.  Merchants interested in the potential of “on-site social commerce” should check out what Amazon has done here and keep an eye on where they go next.

(For those interested in archeology: before Facebook built the one-social-graph-to-rule-them-all, Amazon had social-graph-building aspirations of their own.  They called it “Amazon Friends and Interesting People.”  Dig here to learn more.)

TripAdvisor’s new Facebook integration shows the future of social commerce

July 14, 2010 by George Eberstadt

If you sell online and haven’t seen TripAdvisor’s new Facebook integration, check it out.  It’s a great example of what the future of social commerce is going to look like.  Go to any destination page on and look for the blue box to the right of the image.  Here’s what it looks like for me for Zurich:

There are three aspects of this application that point the way to the future.

Context.  You could get the information displayed here – which of your friends has been to a place you’re researching – by going to the TripAdvisor Cities-I’ve-Visited app.  But would you?  Here, TripAdvisor is delivering the social information in the context of your normal research path, rather than forcing you to detour to get it.  That makes you much more likely to consume this influential content.  For online merchants, context is just as important.  Shoppers do product research on product sites, not on social sites.  So it’s more powerful to bring the social references into the normal shopping path than it is to bring product information into the social environment.

Data source integration.  This tool combines two data sources – one from TripAdvisor and one from Facebook.  TripAdvisor has a database of places that many of their members have been.  It comes from a popular app they built a few years ago called “Places I’ve Visited”.  These data are combined with Facebook’s who-knows-who data, enabling TripAdvisor to tell you which of your friends have been to a particular place.  (Note: this has nothing to do with Facebook’s “Like” functions!)  As a merchant, you have a database just like TripAdvisor’s that you can leverage in a similar way: your purchase history data.  A mash-up between this data set and friend lists from Facebook (and other sources) is the key to delivering socially-enhanced shopping experiences.

Message-based communication.  The backbone of social commerce, to date, has been customer reviews.  Though highly effective, they’re not really all that social.  The shopper who posts a review never knows who will read it.  The shopper who reads a review can’t reach the person who wrote it.  There’s no direct communication between shoppers.  But in this TripAdvisor app, a visitor is offered a channel to connect directly to people with knowledge of the topic.  This is not passive Q&A where questions just hang around waiting for someone who can answer to happen by.  This is a message-based model where shoppers can actively reach out to one another.  My question about Zurich is not just posted on the Zurich page, it’s sent to the inbox of people who have been to Zurich.  That deepens and extends the engagement of the current visitor, who is called back each time their question is answered.  And it re-engages the past visitor who receives and answers the question.  This direct, message-based communication is also in the (near) future of social commerce.

Introducing the TurnTo Social Commerce Suite

June 8, 2010 by George Eberstadt

It’s a big day at TurnTo: we’re introducing our Social Commerce Suite.  (Yes, we know that it’s ambitious to call it a “Suite” with just 2 products – please humor us. Also, there’s more in the pipeline…) Official press release here.

So what’s new? 1. We’ve done a nearly complete overhaul of our current product, now branded “Social Merchandising” and 2. We’re introducing a new product called “Social Purchase Sharing”.

Social Merchandising. We’ve made improvements top to bottom.

  • Shoppers who open the widget but don’t personalize it by checking for friends will now see a range of other customers and their purchases designed to give the site that buzzing busy-store feeling and to encourage consideration and purchase of more items. (The goal is to address one of the big limitations of the shopping online: lots of stuff in the stores, but no people.)  We’ve built a ranking engine that selects which customers and which items to show, ensuring the greatest relevance given limited data.
  • We’ve made the value and process of personalizing the widget a lot more transparent to the user, so many more of those who open the widget will go the next step and personalize it to see their own friends in place of those the system picks. Underlying this is a simplification of the sharing rules to a vanilla Twitter-style “follow” model. (See our last post about the importance of simplicity when it comes to privacy and sharing.) We’ve also switched to delegated login for most of the friend list sources we support, including the newest Facebook protocols. (The short explanation: it’s better.)
  • The widget now shows big, attractive product images throughout, so not only are shoppers seeing which of their friends also shop at that store, the purchases those friends made look particularly inviting.  Good for cross-sell and order size improvement.
  • The comment mechanism has been redone to both capture more input from buyers and to show it more visibly to shoppers.
  • We’ve made significant enhancements to the guts of the system to provide greater speed and reliability. These include use of a Content Delivery Network as well as a range of server-side caching and summarizing strategies. The design point was to be able to support the largest ecommerce sites out there.
  • We’ve added new tools for optimizing the button that calls up the widget. It doesn’t do stores any good to have a fabulous social merchandising tool if only a few shoppers use it. We now provide a range of more interactive button designs as well as tools for doing rotation tests (randomized A/B/C tests) of alternatives. In its initial use, we’ve already seen large engagement rate improvements.

In a nutshell: you have to see it. So here’s the first screen shot we’ve released:

Social Purchase Sharing. Our partner merchants have been telling us how valuable it is when a customer posts to their social network (most often Facebook and Twitter) about their purchase. So we’ve added a simple tool to significantly increase the amount of purchase sharing online stores can generate. It’s an overlay that appears on the order confirmation page right after a purchase and makes a clear, persuasive appeal to share. The permission obtained from the buyer is also used to power the Social Merchandising widget, so the “sharing” appears both on the social networks and on the store site itself. Here’s an example of the overlay – just picture it on top of your order confirmation page. (See also our blog post on “Like” vs. “Bought”.

The TurnTo Social Commerce Suite will be generally available to online retailers at the beginning of Q3, 2010. If you are in Chicago this week for the Internet Retailer show (IRCE), please come by booth #431 and we’ll give you a full demo. If you’d like more information on the thinking that went into these products, please have a look at the white paper we just released: Onsite Social for Online Commerce.

New whitepaper out: Onsite Social for Online Retail

May 27, 2010 by George Eberstadt

After over a year in the market helping a few dozen innovative online retailers add social shopping features to their stores, we thought it was time to synthesize and share the big lessons we’ve learned.  So here [drumroll] is our new whitepaper: Onsite Social for Online Commerce.  In it, we get specific about things like:

  • How to leverage social networks for Social Merchandising within your store
  • How to most effectively encourage shoppers to share news of their purchases with their social network friends
  • Why adding Social to ecommerce sites requires different strategies than for content sites
  • What sort of results are realistic to expect

We’re just putting it out there – no registration required to get it.  If you find it thought-provoking, we hope you’ll get in touch with us and pass it on to others.  Enjoy!

For ecommerce sites, “Like” is OK, but “Bought” is much better

April 21, 2010 by George Eberstadt

First: we wholeheartedly agree with the ideas underlying Facebook’s big announcements today. People want to be able to interact with their friends on sites all across the web, not just within Facebook.  And sites don’t all want to have to become Facebook apps to support this.

TurnTo has been working to enable contextual delivery of social networks on ecommerce sites since our founding in 2007.  And we’ve proved that the benefits for both shoppers and merchants are significant.  So we applaud Facebook, appreciate the validation that their heading in this direction provides, and are already hard at work incorporating their new API.

We also think that to derive maximum advantage from an Onsite Social strategy, ecommerce sites should not rely exclusively on the new Like-based functions that Facebook is providing, but should – more importantly – leverage their purchase transaction data.  Here’s why:

It’s useful for your shoppers to see which of their friends know about your store and the products you sell.  Facebook’s API takes care of the problem of determining who you shoppers’ friends are.  But how do you determine what those friends know about?  Facebook’s new Like button lets shoppers register a connection to items on your store that they, well, like.  But Like does not equal know-about.  And many people who buy from you – and therefore REALLY know about you and your products, will never click Like.  In other words, there will be loads of false positives and false negatives.

If you were a content site, this might be the best you can do.  But as a commerce site, you have a unique asset: the purchase transaction.  You already have a massive set of people who really do know about you and your products, and the list grows every day.  They’re called: customers.

So go ahead and use the new Facebook plugins.  But also, and more importantly, leverage your transactional data to socialize the shopping experience on your site.  That’s where the big opportunity lies.

Forrester TechRadar report on Social Commerce cites TurnTo

March 23, 2010 by George Eberstadt

Forrester retail guru Sucharita Mulpuru recently published her latest TechRadar report on Social Commerce.  Available from Forrester here.  And for free download from ATG here.

We were pleased to be included as one of a select group of vendors profiled in the report.  It’s a great resource for retailers in planning their approach to social.  Here’s the chart that summarizes it all in one place:

Recommended reading: Optaros on the power of Social Shopping

January 20, 2010 by George Eberstadt

Optaros’ “Social Ecommerce Ebook” makes for great reading if you are trying to optimize the performance of your ecommerce site.  You can download it here.

They make the points that: 1. higher levels of shopper engagement on retail sites drive improved business performance, and 2. social commerce tools are a powerful way to drive engagement.

A couple highlights:  From the Harvard Business Review Article, “In Ecommerce, More is More“, they cite,

The majority of managers we spoke to in our global study told us they believe that a broad array of information diverts attention from the core offerings. But we found it helps customers search for solutions, invites them to think of all the ways the core products might add value to their lives, wins their loyalty, and entices them to buy. In fact, we found that exploiting consumers’ desire for engagement is the single dominant driver of superior shareholder value for e-commerce companies.

In the section titled “Making Shopping a Social Experience,” (p.44 on) they cite an article in the Wall Street Journal on the benefits of social shopping.  (The article features the positive results Teavana and Compsource are seeing from their TurnTo implementations!)  Their “Business Takeaway”:

People like to go shopping with others when shopping in person. With Facebook Connect and other social shopping applications, you can replicate this experience for your customers online.

The bottom line of their study (well, it’s actually more like the title): “Retailers Achieve Higher Conversion Rates Using Social Shopping.”

Do promotions help retailers’ bottom line more than investments in social tools et al?

December 16, 2009 by George Eberstadt

Data from comScore as reported in the Wall Street Journal shows holiday sales up 4% over last year.  Not bad considering the economy. But the growth appears to be driven largely by a huge increase in promotions:

“Data from show that online retailer promotion activity is continuing at a high rate with the number of offers in the last week up 21% versus a year ago,” said comScore Chairman Gian Fulgoni.

The strong sales numbers won’t mean much if the January headlines are all about the carnage from over-discounting.  (Remember the joke about making up for negative margin on volume?…)

I’d like to see an analysis that compares the cost of all that discounting to the cost of tools that could drive equal sales volume without compromising price.  For example, for a small percent of the cost of their holiday promotions, most retailers could dramatically expand initiatives like social shopping.  And in the end, their bottom lines might look a lot better.  Please comment if you know any work that looks at this.

A great perspective on what social commerce really means

November 10, 2009 by George Eberstadt

Paul Dunay, The Global Managing Director for Services and Social Media at Avaya, gave this description of social commerce in an interview in eMarketer:

Social commerce is working with or using your social graph, which is defined as your followers or your friends, and allowing them to help you make buying decisions. Social commerce can be anything from a buying suggestion or recommendation—perhaps a tweet from a Dell outlet saying, “Hey, we have a special on this”—to something like Facebook Connect. Facebook Connect would allow you to go to a Website like and authenticate yourself using your Facebook profile, allow your identity to be known and access your friends so you could spark up a chat. So I could say, “Hey, Jeff, I’m looking at this new fancy laptop or this netbook. I heard you bought something. Would you recommend this to me?” So you could almost take your friends shopping with you. That is the potential with this example.

Hey Paul, come look at the sites using TurnTo.  Your vision is alive today!

TurnTo is in the Wall Street Journal today

June 2, 2009 by George Eberstadt

Here’s the full article:

And here’s what they have to say about us: New York-based TurnTo Networks Inc., for example, which was launched in September, helps retailers link their customer accounts with social-networking accounts and email accounts using Facebook Connect and other tools. TurnTo charges retailers a percentage of the revenue from sales attributed to the system.

Tea retailer Teavana Corp. is a TurnTo client. Jay Allen, Teavana’s vice president of e-commerce, says the conversion rate—a measure of how many shoppers make purchases—for people who use the application is 20% higher than the rate for others, and their average orders are slightly more expensive.

TurnTo founder George Eberstadt says preliminary data for the company’s first 20 clients show that using TurnTo tends to increase conversion rates 20% to 50% and builds traffic to retailers’ sites. Some 700,000 new users, for instance, have come to computer retailer CompSource Inc.’s site through its TurnTo application since July. TurnTo is “a lot better than average” in terms of price per new customer compared with pay-per-click advertising, says Dean Bellone, CompSource’s president.