a.k.a. adaptive transactional marketing, f-commerce, Facebook commerce, s-commerce, s-ecommerce, shopping 2.0, social currency, social network selling, social shopping, t-commerce, tablet commerce, virtual economy
Social commerce is a subset of e-commerce that uses social media to assist in the online buying and selling of products and services. In other words, it is a mashup of e-commerce and social networking, integrating best practices in catalog, merchandising, and shopping cart processes with consumer-to-consumer (C2C) engagement, content sharing, and social activity.
Examples of social commerce include customer ratings and reviews, user recommendations and referrals, social shopping tools, social media optimization, social applications, and social advertising. Technologies such as Augmented Reality (AR) have also been used with social commerce, allowing shoppers to visualize apparel items on themselves and solicit feedback through social networking.
According to Fred Cavazza in Forbes, social commerce existed through Amazon and Ebay, and the foundations of social commerce were established years ago in the book Cluetrain Manifesto: "Markets are conversations." He identifies six practices associated with social commerce:
1. Buyer community (GDGT)
2. Group buying (Groupon, Living Social)
3. Purchase sharing (JustBoughtIt)
4. Curation (Polyvore, Pinterest)
5. Social advice (Fashism)
6. Co-shopping (like the Shop Together app then used by Charlotte Russe)
The term social commerce was introduced by Yahoo! in November 2005 to describe a set of collaborative online shopping tools such as shared pick lists, user ratings and other user-generated content sharing. Online marketers like the idea of getting advice from trusted individuals (word-of-mouse) because research shows it increases the users' trust in one retailer over another. It's considered the Holy Grail of marketing: Making your customers your marketers.
Social media experts say the very notion of shopping on a retailer's website will become dated. Expecting people to come to your website is expecting them to make an extra effort. If you want to participate in social commerce, you need a commerce presence on a social networking site such as Facebook.
NetLingo Classification: Net Technology