Social Commerce
Social Network Study 2011
SNU IDB
Outline
 Social Commerce
 Social Commerce Sites
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–
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Groupon
LivingSocial
Etsy
Ticket Monster
Coupang
One a day
2
Introduction
 Social commerce
– 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
e-Commerce
Social
Commerce
3
Social Media
Introduction
 “Social commerce”
– Introduced by Yahoo! In Nov 2005
– Describe a set of online collaborative shopping tools
 Shared pick lists, user ratings, and other user-generated content-sharing of
online product information and advice
 What is new?
– Range of social commerce tools and opportunities are expanded
–  link social media platforms to e-commerce platforms
4
Introduction
 Two central activities
– 1. putting water-coolers next to tills
 Helping people connect where they buy
by adding and linking social media tools
and content to e-commerce sites
 E.g., Amazon – rate and review products
– 2. putting cash tills next to water-coolers
 Helping people buy where they connect
by embedding social media stores and
storefronts to popular social media platforms
 E.g., Best buy’s storefront in Facebook
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Concept
Use the services
Local
Service
Provider
Register services
Give back the
profits exclude
a commission
Social
Commerce
Service
Provider
- Promote products
easily
buy services
Customer
Pay the price
- Bargain price
- Target:
Late teens ~ mid thirties
single women
6
Why Social Commerce?
 Business perspective
– Social media marketing monetization
 Helps marketers monetize and measure campaigns
– e-Commerce sales optimization
 Improve conversion rates and increase average order value for online retailers
– Business model innovation
 Creating new revenue streams by curating and extracting value from social
media content
7
Why Social Commerce?
 User perspective
– Trust
 Because social media content increases ‘source credibility’ of sales and
marketing messages, making them more believable, persuasive and
trustworthy to the user
– Utility
 By putting the social commerce tools at the disposition of customers, brand,
businesses and retailers can enhance the online customer experience
– Fun
 In contrast early e-commerce was a solitary experience, people interacting with
software
 Social commerce helps make commerce social again
– Social commerce can enhance the customer journey, from initial ‘need
recognition’ and ‘product discovery’, through ‘product selection’ and
‘product referral’
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Types
 1. Social Link
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Types
 2. Social Web
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Types
 3. Group purchase
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Types
 4. Coupled with offline
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Types
 4. Coupled with offline
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Six Dimensions of Social Commerce
 Dimension 1: Social Shopping
– Allows people to share the act of online shopping together (synchronous
shopping)
– Adds emotion into the e-commerce mix
– Enables real-time recommendations
– Includes …
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
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
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Group buying
Co-browsing
Group gifting
Ask-your-network
Social network storefronts
Social shopping portals
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Six Dimensions of Social Commerce
 Dimension 2: Rating & Reviews
– Provide independent third-party evaluation of a product or service review,
with an opportunity for viewers to contribute and discuss
– What’s new?
 Review syndication, contrast review (pos/neg), tagged reviews, vidio revies,
geo-tagged mobile reviews, …
– Includes…




Customer ratings & reviews
Expert ratings & reviews
Sponsored reviews
Customer testimonials
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Six Dimensions of Social Commerce
 Dimension 3: Recommendations & Referrals
– Promotes personal recommendations and referrals within online social
circles, often rewarding referrers for their efforts
– Sometimes integrated in social shopping portals
– Can use syndication tool via Twitter and Facebook to share
recommendations with friends, fans, and followers
– Includes…
 Share with your network
 Referral programs
 Social recommendations
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Six Dimensions of Social Commerce
 Dimension 4: Forums & Communities
– Connect people with each other and to a business in a moderated and
curated environment
– Includes…
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
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User forums
User galleries
Idea boards
Q&A forums
Brand communities
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Six Dimensions of Social Commerce
 Dimensions 5: SMO (Social Media Optimization)
– Promoting and publicizing websites and website content through social
media
– Includes…
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
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News feeds
Media sharing
Social media events
Link building
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Six Dimensions of Social Commerce
 Dimension 6: Social Ads & Apps
– Branded content in social media in the form of paid advertisements or
social applications
– Social apps outperform social ads because they also use reciprocity
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Future Trend
 Social CRM
 Mobile Social Commerce
 Curated Social Marketplace
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References
 Wikipedia - Social Commerce
 Social Commerce: Monetizing Social Media,
Paul Marsden, Syzygy Group, 2010
 The Era of Social Commerce,
http://aboutsocialmedia.blogspot.com/2010/08/era-of-social-commerce.html
 소셜 커머스의 4가지 유형,
http://www.bloter.net/archives/31355
 The 6 Dimensions of Social Commerce: Rated and Reviewed,
http://socialcommercetoday.com/the-6-dimensions-of-social-commerce-rated-and-reviewed/
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Social Commerce Sites
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Groupon
Groupon?
 A social commerce site launched in 2008
 Known for the first social commerce
 Group + Coupon = Groupon
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Introduction to Groupon
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Introduction to Groupon (cont.)
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Explosive growth of Groupon
 Serves in about 40 countries and has amassed 35 million
registered users
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Acquisition & Re-brand
 Acquired several international operations similar to Groupon
 Re-branded under the Groupon name after acquisition
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History
I’m Andrew
Mason.
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History (cont.)
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History (cont.)
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Feature list
 Featured Deal (deal of the day)
 MegaGift
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Business model
Brokerage fees (Groupon & retailer would split)
Social
Shopping
Limited time,
The minimum personnel,
More than half discount
Providing buyer
characteristics,
Statistical information
Region-based
Customer
Cheap prices
Impulsive,
Fun consumption
Seller
Social media
Word of mouth effects
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Ad, PR effects
Business Model
Application based on Groupon
 “Chocolate” is an example of applicatioin
 SK Telecom + Groupon = Chocolate
 Similar to Groupon, but for SKT members only
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Success Factors
Region-based commerce platform
 Deals with offline goods/services based on local region
 Brings marketing effects
 Commercializes offline services into online services
cf) yelp.com
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Success Factors
Thoroughly simple & intuitive interface
 Checking Feature Deal and clicking for buying is all
 Reduces the load about decision of mass goods
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Success Factors
Social media marketing
 Win-Win strategy by sharing Feature Deal (buzz marketing)
 Incentive System
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References
1.
2.
3.
4.
Wikipedia “Groupon”
네이버 백과사전 “소셜 커머스”
Groupon (Korea)
그루폰, e비즈북스, 근간예정
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LivingSocial
LivingSocial
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History
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Feature List
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Today’s Deals
Instant Deals
Past Deals
More Cities
Escapes
Families
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Business Model
 LivingSocial offers a new deal each day
– LivingSocial sends email to its members who subscribe via email
– Members have a chance to save 50-90%
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Business Model
 The original purchasing member obtains a free offer if he recom
mends three persons to purchase
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Business Model
 LivingSocial provides a surge of new customers for menchants
– LivingSocial takes a cut of the deal revenue
 LivingSocial helps the local consumers figure out where to spend
their money
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Acquisition
 InfoEther
– In March 2011,LivingSocial acquired InfoEther
– InfoEther is one of the leading technology
 Let’s Bonus
– In January 2011,LivingSocial acquired a majority stake
– Let’s Bonus is a social shopping site launched in Spain, Italy, Portugal,
Argentina and Mexico
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Acquisition(cont.)
 Jump On it
– In November 2010,LivingSocial bought $5 million controlling stake in Austr
alian social shopping site Jump On It
 Urban Escapes
– In October 2010, LivingSocial announced acquisition of social adventure co
mpany Urban Escapes
– Urban Escapes led to the launch of LivingSocial Escape and LivingSocial
Adventures
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Comparisons-Similarities
LivingSocial VS Groupon
 Similarities between LivingSocial and Groupon
– Both Living Social and Groupon are coupon based company.
– Both Living Social and Groupon are busy expanding to new cities.
– Both Living Social and Groupon making good use of social features.
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Comparisons-Similarities(cont.)
LivingSocial VS Groupon
 Similarities between LivingSocial and Groupon
– Both Living Social and Groupon making good use of social features.
– Both Living Social and Groupon’s websites use Facebook Connect to help p
eople find deals according to the geography, then share these deals on Fac
ebook or other social media.
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Comparisons-Differences
LivingSocial VS Groupon
 Differences between LivingSocial and Groupon
– Groupon has 40 million subscriber in 35 countries and 335 cities VS Living S
ocial has 26 million members in 5 countries and 89 cities.
– Groupon is the pioneer VS Living is a clone
– Groupon is earning 3 times more than Living Social is making
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Who will be the winner?
LivingSocial
will be No.1 b
y 2012
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References
 References
– Wikipedia-LivingSocial
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Etsy
Introduction
 WAL*MART economy
What about producers and consumers?
Introduction
Distributed
M
a
s
s
Customization
M o d e l
Unique product, Social communication, Contents driven commerce
>> Communication between producers and consumers
Introduction
 Etsy
– E-commerce website launched on June 18, 2005
Robert Kalin
Chris Maguire
Haim Schoppik
Jared Tarbell
Introduction
“I wanted a nonsense word because I
wanted to build the brand from scratch.
I was watching Fellini’s 8 ½ and writing
down what I was hearing.”
In Italian, “oh, yes”
In Latin, “and if”
Introduction
 Etsy
– Focused on handmade or vintage items as well as art and craft supplies
 Including art, photography, clothing jewelry, edibles, bath & beauty products,
quilts, knick-knacks and toys
 Rule for vintage items: must be 20 years or older
– P2P market place
 No distributors between users
 Anyone can be a seller or a buyer
buyers
sellers
Introduction
 Etsy
– In 2009,
 85M users (buyers)
 8M artists and designers (sellers)
 Monthly turnover of 50 million dollars (May 2009)
Unique visitors
From compete.com
– No budget for advertisement
 Only word-of-mouth marketing
Introduction
 Etsy
Introduction
 Etsy
– Everyone can join this!
Introduction
 Records
– Attract $3,100-million investment
 Investors
–
–
–
–
–
–
Catalina Fake (an individual investor) of Yahoo!
Sean Meenan
Spencer and Judson Ain
Union Squre Ventures
Founders of Flickr and Delicious
…
– $0.2-billion of exchange volume
– 100% growth of every figure (visitors, exchange volume, benefit, …) from
2008 to 2009
Introduction
 Etsy Labs
– A permanent office of Etsy in Dumbo, Brooklyn
– Site’s customer support, marketing/PR, business & communications teams
operate out of this office
– Has a community workspace that provides equipment and donated
materials
Introduction
 Etsy Labs
Introduction
 Revenue
Features
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


Buy
Sell
Community
Blog
Similar Sites
Foodzie
Similar Sites
1forme
Conclusion
 Market for producer, consumer, and environment
 Accommodate individual taste
 “Communication” is the future of the distribution
References
 Wikipedia: Etsy
http://en.wikipedia.org/wiki/Etsy
 www.etsy.com
 Etsy "월마트 이코노미"의 틈새를 노리는 P2P 쇼핑몰
http://www.x2soft.co.kr/263
 Handmade 2.0, New York Times Magazine (New York Times)
http://www.nytimes.com/2007/12/16/magazine/16Craftst.html?_r=2&oref=slogin&ref=magazine&pagewanted=all
 플라이팬, 어떤 비즈니스를 준비하고 있어요?
http://blog.flyfan.net/?p=395
 Statistics: Alexa, Compete
Ticket Monster
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Ticketmonster
 Ticketmonster has everything at 50 percent off!
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Features

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Today timon
Timon Store
Timon Tour
Board
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Success Factor
Products
&
Management
Extend region
&
Scale
Brand
&
Naming
The number
of customers
Customer
confidence
Design
&
Contents
With Dailypick
75
References
 티켓몬스터 www.ticketmonster.com
 젊음과 패기로 뭉친 소셜 커머스 2.0 주자 신현성 http://blog.naver.com/websmedia/40126748137
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Coupang
Introduction
 Coupang
– Group purchase website
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Introduction
 Coupang
– Group purchase website
고재우, 윤선주, 김범석 (From left to right)
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Introduction
 Color Your Days
– Users can experience varied life everyday
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Introduction
 Rankey.com
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Features

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
Daily 쿠팡
쿠팡 Mall
Play 쿠팡
전체보기
지난 쿠팡 보기
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Conclusion
 Commercializes offline market into online
 Win-win strategy by buzz marketing
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References
 Rankey.com
http://www.rankey.com/rank/rank_site_cate.php?cat1_id=11&cat2_id=2691&cat3_id=2390
 쿠팡 김범석 대표
http://blog.daum.net/lgjuwon/978
 하버드 3총사 벤처 창업했다
http://www.mt.co.kr/view/mtview.php?type=1&no=2010072422535502547
 김범석 대표, 다채로운 삶에 도움 줄 것
http://kdw0796.tistory.com/entry/CEO%EC%9D%B8%ED%84%B0%EB%B7%B0%EC%86%8C%EC%85
%9C-%EC%BB%A4%EB%A8%B8%EC%8A%A4-%EC%BF%A0%ED%8C%A1%EA%B9%80%EB%B2%94%EC%84%9D-%EB%8C%80%ED%91%9C%EB%8B%A4%EC%B1%84%EB%A1%9C%EC%9A%B4-%EC%82%B6%EC%97%90%EB%8F%84%EC%9B%80-%EC%A4%84-%EA%B2%83
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One a day
What is one a day
 Launched Jan 2007
 Daily Deals
 Sell products at the lowest price
 Construct reliable selling system
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One product per one day
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One product per one day
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Features
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one product per one day
statistics
review
blog widget
product history
product offer
product alarm
event
89
There are many one a day market
90
One a day Store Solution Service
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SWOT
Strength
Weakness
simple
Lower price, higher quality
Lack of categorization
reliable delivery system
Daily product supply
Feedback system
Monotonous product
Opportunity
One a day
Threat
Growing social commerce
market
Too many social market
More investment on one a
market disbelief
day
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Successful Factor
 7000 Offers per year
 100,000 customers
 Top 10 buyer: 10,000,000 won/year
 Gain customers trust
 Staff: 25 Members (9 Managing director)
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Successful Factor
 CEO Manpower
 Market Frontier
94
References
 References
– Wikipedia
– http://blog.yipit.com/
– http://msn.ebn.co.kr/news/
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