What can the social commerce industry – brands, retailers and platform providers, learn from social commerce platform Groupon’s ‘Kenneth Cole Moment‘ at the Super Bowl this weekend (videos below)?

Incase you missed it, Groupon is being resoundingly crowd-slapped for it’s $100,000/second Super Bowl 45 – 2011 ad campaign by Crispin Porter & Bogusky/Christopher Spinal-Tap-Mockumentory Guest, poking fun at celebrities and brands that endorse causes (Tibet (Timothy Hutton), Rain Forests (Liz Hurley) and Whales (Cuba Gooding, Jr.)) that are supported by Groupon.  Just as retailer Kenneth Cole was recently crowd-slapped for a Twitter post “Millions are in Uproar in #Cairo. Rumor is they heard out new spring collection is now available at http://bit.ly/KCairo – KC.”

If Super Bowl sexism is fine – what could go wrong with using politically-charged territorial disputes in the Himalaya and environmental sacred cows trees/whales to sell group-buy coupons? (Hint, everything).

Well, the first thing we learn is not to forget to run a campaign litmus test before you go live with marketing.  Before running a campaign, dip a metaphorical litmus strip into your creative – if it comes out blue (left/liberal) or red (right/conservative), bin it.  Politics and marketing rarely mix well, and worse if you try and mix in humour, so keep your campaign Ph level politically neutral to avoid alienating people.  The litmus test might not have saved Groupon; the ads are neither left not right, just (according to many) politically offensive to just about everyone, but it’s a good reminder.

But the second thing we learn is that being controversial gets you talked about – and getting talked about is the life blood of a social brand.   Whatever its sins, the Groupon campaign was remarkable, literally, in that it is one of the few Super Bowl ads this year to jump off the screen and onto people’s lips (the Groupon ad was the most successful at getting talked about, after the (brilliant – for a legacy media ad) Eminem/Chrysler ad – see infegy graph below).  As a social brand, Groupon will know that getting onto conversational agendas is what drives awareness – and ultimately use.  The campaign has ignited conversations – for and against – eclipsing, for example, the new rebranding of Amazon-backed rival LivingSocial (thanks @erikeliason), news on Facebook Deals and Google Offers.  Sure, not all publicity is good publicity, it’s hard to position BPs recent tribulations as a PR coup, but it is usually better to part of the conversation than be ignored. Groupon is back to top-of-mind in the social commerce space.

And courting controversy can be clever; by signalling a faux-red culturally insensitive flag to the political correct, it then leads those who care enough down a rabbit hole to find a young company that takes CSR seriously and smart enough to make reflexive commentary.  Sure, most people won’t scratch the surface, but they may not be fans of political correctness anyway.  And for those that do, it’s a moot point as to whether the lure of a deal will be trumped by political correctness.  Cynics may point out that at least more football fans may now be aware of Tibet – at least where it is – and that’s a start.

Moreover, the campaign was ‘on brand’, tongue-in-cheek, irreverent and iconoclastic.  If you use Groupon, you know Groupon copy is worth reading, it’s humorous, self-depricating, whilst often poking fun at both Groupon-ers and retailers.  The humour and irreverence is part of what sets Groupon apart from the myriad of me-too social commerce platforms – it’s a USP.

So was Groupon’s Super Bowl ad a Kenneth Cole moment?  Perhaps, but we don’t think it’s as black and white as some would say.   Ultimately, social commerce works when you’re selling something worth talking about, but conversations can be stimulated and ignited by smart marketing that courts controversy with polemic points of view and personality.

Don’t be too quick to add the #fail hash tag to Groupon’s Super Bowl 2011.

Article courtesy of Social Commerce Today

Blood is what you’d expect to find on the wall of Miami’s favourite blood splatter analyst, but now there’s a store, a ‘Wall-Store’.  CBS’s Showtime is doing pop-up retail in Facebook, with a ‘Wall-Store‘ selling select Dexter-branded Valentine’s Day gifts (click ‘just Dexter’ in the Facebook new feed to see the wall store).

Facebook Wall-Stores (also known as ‘news feed stores’) are an interesting viral variation to ‘traditional’ Facebook ‘Tab Stores‘ (Cartoon Network) or ‘Page Stores‘ (ASOS).  They are shareable stores that appear in news feeds, often selling just a few products.  Buy something or like something from a wall-store and the store is syndicated to also appear in your friends’ news feeds; i.e. on what they experience as Facebook’s front page.  Smart move Showtime. The Dexter Wall-Store, run on Milyoni software (and branded ‘Instant Showcase’), allows users to complete transactions – in this case with five clicks – without ever leaving the wall. Delta Airlines, using Alvenda (now 8th Bridge) software offers a similar service.

We like Wall-Stores because we think they play to Facebook’s strength as a conversational platform – they appear in conversations, and stimulate conversations.  Sure, you can replicate your entire web store in Facebook with an f-store that sells a full range of products.  This is the route that ASOS and J.C. Penney have taken.  But you have to ask the question, why?  For some, the answer is simple; now so many people spend so much of their time online in Facebook, it makes sense to  fish where the fish are and start selling everything you have to sell in Facebook. Why, if you sell on the Wild West plains of the open Web, wouldn’t you want to sell in the more populous Walled City that is Facebook?  There are probably more people on Facebook now than there were on the Web when you started out with e-commerce.

And of course replicating your Web-store in Facebook brings you an added viral benefit; unlike Web-store purchases, f-store purchases advertise themselves by becoming news feed  items, syndicated to (on average) 140 friends, so the more items you sell in Facebook, the more free advertising you get.  Furthermore, this free advertising gets you something most other advertising can’t deliver – something communication professionals call source credibility.  Source credibility, the believability and trustworthiness of a communication, is critical for influence to occur (95% of consumers don’t trust ads) – advertising without source credibility is about as useful as a pair of fetid dingo’s kidneys.

So, port your web-store to Facebook, and start selling everything there, right?

Well, perhaps… An alternative perspective is to view f-stores and web-stores as qualitatively different.  Why simply replicate a Web-store in Facebook?  It’s pointless. Clicking through from an ad or status update to a Web-store is not difficult and after all, Facebook is still a very primitive retail platform; it’s difficult to offer a gold-standard online full retail experience in Facebook, so why bother?  Instead, why not adapt your retail strategy in Facebook to the real-time conversational nature of medium – and use f-stores as real-time ‘event stores’ or ‘campaign stores’ designed to ‘tryvertise’ a limited range of new products for a limited amount of time.  In other words, use Facebook for running retail events – like selling a range of Valentine’s Day Dexter merchandise*.  Wall-Stores, with their viral potential, are a smart vehicle for such event-based live retail.  We like.

____________________

* Of course, there is a third point of view that Facebook is a conversational platform for social interaction, not for commercial transaction. Selling on Facebook is like selling at a friends’ get-together.  Sad. We are already surrounded by enough places and people selling their stuff; we don’t need yet more commercialisation of social space. Just as a concession stand behind your friend’s BBQ selling the wares of P&G or Unilever would be out of place – so too is a Facebook store. Commercialism is maladapted to the social space, and therefore will die. Furthermore, by selling in Facebook not only will you waste money, you’ll also risk damaging your reputation because you are disrespecting your customers’ social space.  Imagine a salesman popping up from behind the couch during an intimate and romantic tete-a-tete.  It’s the kind of menage-a-trois no business needs. Interact, share, and support in social media, but don’t sell.

The ‘no-commerce’ perspective is a perfectly valid argument, particularly if you are of the Naomi Klein persuasion – but it’s ultimately a moral argument, and we don’t buy it.  Nobody is forcing anybody to buy on Facebook or even visit f-stores. Who are we to impose our views on where we can buy online? Moreover, the same argument could be used for Web-commerce – the Web, like Facebook, was designed as communication tool not a commerce tool, but that hasn’t stopped e-commerce from becoming a success story.  You may not like commercialism, but it makes business sense. Saying no to f-commerce now is like saying no to e-commerce.  It’s an option, but…

Article courtesy of Social Commerce Today

So ASOS, leading European fashion e-tailer launched its f-commerce store yesterday.  And in our view, the new f-store lives up to the pre-launch hype, setting a new gold standard for Facebook stores.

The ASOS f-store – featuring the full range of ASOS products – has a lot in common with JCPenney’s f-store that the US department store chain opened up last month; logical, given that they are both built on Usablenet‘s platform.  But the ASOS f-store is a whole lot more polished; compare, for instance, the two sign-up pages.

Good: JCPenney Registration

Better: ASOS Registration

Rather than a lesser version of their e-commerce site, the ASOS f-store holds its own – elegant in usability and simplicity (see screenshots below).  And it looks smart on a mobile handset. The ASOS f-store sports a commendable attention to detail and concern for user experience; from the reassuring name of the app – ASOSOfficial, to the favicon and the clever use of accordions and tabs to reveal and hide in-app content.

The store is fully internationalised, and whilst pitched as the world’s first fully integrated Facebook Store in Europe, we had no problem purchasing from the US (see screenshots below).  And purchasing was a breeze; in a timed benchmark as fast and easy as purchasing on the traditional ASOS e-commerce website.  True to high expectations, we received notification that our product had shipped within a few hours of purchase. The only weak point in the whole experience was the rather curt and unfriendly purchase confirmation page detracting from the overall user experience.

If you had any doubts about f-commerce viability – especially in terms of user experience, we recommend taking a look at the ASOS f-store.  We think you’ll change your mind. And for those in the market for an f-commerce solution, we urge you take a look too – you could do far worse than adopt the ASOS store as the gold-standard benchmark to match or better.  Whilst we’re of the opinion that it makes sense to differentiate the purpose and content of your f-store from your traditional site-based e-store (not simply replicate it), if there is a ‘fish-where-the-fish-are’ case for replicating your e-commerce store in Facebook, then this is it.

And because of ASOS’s status as an industry leader in online retail, Europe’s answer to Zappos, we think the opening of the ASOS store could mark a Tipping Point in f-commerce.  Social commerce solution providers; man your stations.

As William Gibson famously observed, the future is already here – it’s just unevenly distributed.  And so it is with f-commerce; the future is already here, and it’s called ASOS.

Article courtesy of Social Commerce Today

Yahoo!, or rather its Australian subsidiary, Yahoo!7, today announced it had purchased popular Aussie (+NZ) group-buy platform Spreets (revenue $4m/month), for a reported AU$40m (US$40m), joining Microsoft’s (MSN) antipodean foray into social commerce with Cudo (another group-buy platform).

The Aussie group-buy space is peculiar insofar that one of the players, Scoopon, registered the .au domain for Groupon, thus compromising launch of the global social commerce leader in that market (whilst legal challenges are ongoing, Groupon has launched with the domain StarDeals).

But could this be a part of the future for social commerce platforms, integrated into Web portals and content providers, as a way of monetizing eyeballs? Imagine if Google launched a group-buy video deals site on YouTube…

Article courtesy of Social Commerce Today

So the New York Times is reporting that social commerce platform Groupon is preparing an IPO for this spring, valuing the group-couponing giant at a bubblicious $15bn.  That’s around 10 times the investment poured into social commerce startups over the last 12 months (see list below). And to put it into perspective, $15bn is what Microsoft reportedly offered to buy Facebook outright – settling instead for a $240m investment back in 2007.  And $15bn is 4 times the current valuation of Twitter following its latest round of investment. And 2.5 times what Google was rumored to offer to buy Groupon just last month.

So are we entering a social commerce powered ‘Bubble 2.0′? Let’s take a look at what’s been happening over the last year in the social commerce investment space:

• $15bn valuation of Groupon based on rumored IPO (Spring 2011)
• $950m investment in Groupon, social commerce platform (group-buy) (Jan 2011)
• $1.2m investment in ShopSocial, a new Shop-And-Tell social commerce app that will offer kick backs for sharing purchases – (currently no more than a holding page as a site) (Jan 2011)
• $6bn Google offer to buy Groupon social commerce platform (group-buy) (Dec 2010)
• $175m investment in LivingSocial social commerce platform by Amazon (Dec 2010)
• $10m investment in BeachMint, social shopping solutions (Dec 2010)
• $15m investment in Gilt Groupe, social commerce site (members-only flash sales) (Dec 2010)
• $31m investment in HauteLook, social commerce site (members-only flash sales) (Dec 2010)
• $6m investment in Payvment, social commerce software (shopping cart, payments) (Nov 2010)
• $30m investment in Lockerz, the teen ‘friends-with-benefits’ social shopping site with 18m members, including $18m from Zuckerberg/Bezos/Pincus sFund (Nov 2010)
• $5m investment in Yardsellr, social commerce app (f-commerce (Facebook marketplace)) (Nov 2010)
• $1.1m investment in ShopSocially, a social shopping site (shop with your friends) (Oct 2010)
• $20m investment in Etsy, social commerce platform (indie crafts marketplace) (Aug 2010)
• $15m investment in ShopKick, social commerce (check-in rewards) app (Jul 2010)
• $12m investment in Beyond the Rack, social commerce site (members-only flash sales) (July 2010)
• $16m investment in BuyWithMe, social commerce site (group-buy) (July 2010)
• $1.3m investment in Yipit, social commerce site (group-buy deal aggregator) (Jun 2010)
• $19.8m investment in Modcloth, social shopping site (indie fashion) with ‘be the buyer’ (customer driven inventory) program) (Jun 2010)
• $110m purchase of Woot, daily deals community by Amazon (Jun 2010)
• $7.5m investment in Swipely, Shop-And-Tell social commerce app that creates a social stream from credit card payments (May 2010)
• $11.2m investment in Blippy, the Shop-And-Tell social commerce app that creates a social stream from credit card payments (April 2010)
• $6m investment in PowerReviews, social commerce app (user reviews) (Mar 2010)
• $5m investment in Alvenda, social commerce software (f-commerce, shopping cart) (Jan 2010)
• $1.2m investment in ThisNext, social shopping site (Jan 2010)

That’s a lot of investor dollars for a nascent industry – $1.449bn in the non-exhaustive list above. So is the social commerce space overheating?  Well, it is possible we are witnessing some ‘irrational exuberance’ that could create a demand bubble. But we think any irrational exuberance will be short-lived (hence Groupon is smart to IPO ASAP):  In our view it’s a function of an initial rush, borne of pent-up demand, to invest in social media – on track for becoming the planet’s favourite media – now that social media has a real business case and real cash flow. Social commerce is like social media, only with money.

So for the many investors who have been itching to invest in social media, but have been waiting for a business case and cash flow, social commerce delivers. Far better to invest in a company that generates real money now, like Groupon (estimated revenue $800m-1bn) than a social media start-up that’s a great idea, like Twitter, but with no business model.  Hence the early rush to invest in the social commerce industry.

But because social commerce is all about the money – the rest is just conversation, as Gordon Gekko would put it, we think any initial exuberance will be kept in check with hard numbers.  For example, check out Paul Chaney’s 4-point reality check on f-commerce – yes, companies can help you sell on Facebook, but what you get right now is rudimentary and not a lot is getting sold on Facebook (yet) (sales volumes are low, managing back-end functions (integration) can be problematic, merchandising options are few, Facebook becomes a gatekeeper between you and your customer).

Groupon may be the fastest growing company ever, from WordPress blog to $1bn revenue faster than Google, eBay, Amazon, Apple or anyone else, and its 3,100 staff may service 50 million users, but there are uncertainties – such as whether Facebook (or indeed Amazon) will muscle in and eat Groupon’s lunch.  But the rumoured Groupon IPO at $15bn would give a company with $1bn revenue a nominal P/E ratio (Price to Earnings) in the region of just 15;  the average P/E for S&P 500 companies is 20.2 (2000-2010).  So fair value we would say.

Article courtesy of Social Commerce Today

Well, what a year it’s been in social commerce. A year ago, the future was set to be social commerce.  Today, the future’s already here, it’s just unevenly distributed – in true Gibsonian fashion.

So here’s our infographic summarising social commerce highlights of 2010.  Use as creative stimulus for your 2011 social commerce initiatives, or as proof-points to persuade budget holders that the future of social media is here, and it’s called social commerce.

Click image for large version (and here to download zipped high-res tiff image)

Article courtesy of Social Commerce Today

On the heels of last week’s launch of the premium Group Buy plugin for WordPress blogs from GroupBuyingSite.com, GetShopped has launched a similar but free (for now) group-buy plugin that works with the popular WP e-Commerce plugin.

You’ll remember that Groupon itself started out as customised WordPress blog, so if you run a blog for your brand or business – why not monetise your efforts by hosting Group Buy deals?  The GetShopped Group Buy plugin comes with a Groupon styled theme – and is an early beta version, so it’ll need testing and optimising before going live on your blog, but it might just be your quick social commerce win for 2011 (download here).

Article courtesy of Social Commerce Today

Maybe this is a sign of the times, but you know when something has gone mainstream when there’s a WordPress plugin to do it.

The world’s favourite (and free) CMS (content management system) has Groupon’d itself up with a plugin that allows you to run group-buy flash sales and daily deals on any wordpress powered site or blog.  All you need is a PayPal account to collect the cash.

So if you fancy yourself as the next Andrew Mason – CEO of Groupon, the fastest growing web business ever (wordpress blog to $800m+ revenue in 18 months), then check out GroupBuyingSite.com for a new Group Buy wordpress plugin that could turn your site or blog into the next Groupon.

Or not.  Of course, Groupon is powered not just by a great idea and great deals, but by hefty investment, a not-so-small small army of deal negotiators and big advertising budgets.  But whilst dreams of becoming Andrew Mason 2.0 will stay just that – dreams – the democratisation of Group Buy technology is nevertheless an opportunity for brand sites, bloggers and small businesses alike – particularly in specialised verticals.  Run a special interest business, brand site, web service, blog or e-zine?  It could be worth shelling out the $200 for the premium plugin to boost revenue or monetize your site.  The B2B space, in particular, and in our opinion, is ripe to get Groupon’d. For instance, why isn’t there a Group Buy site for local deals on office supplies? With the famous five minute install of WordPress + activating the Group Buy Plugin, it could be you.

A word of caution though, it’s not about the technology, nor the Group Buy concept, it’s about the deals.  To be successful, you’ll need an ‘in’ with retailers or service providers in your area – to negotiate unique and compelling deals worth talking about.  You’ll also need to a user base to whom you can promote the deals – Mason and co. have deep pockets and can afford to buy users.  If you don’t have a few million to spare – building an email list from scratch will be prohibitively expensive.  And it’s worth noting haven’t seen any real life examples of the new GroupBuyingSite’s Group Buy plugin in action yet (there is a demo in the site though); perhaps it’ll be worth waiting for the first showcase examples, and contacting theowners for testimonials and feedback.  We’ve contacted the developers for a review copy, which we’ll review for you.

Finally, we’d strongly recommend listening to the experience of others experimenting with Group Buy before starting out.  In particular, Peter Alik over at the wine industry’s digital think tank, Vintank who recently ran a Group Buy social commerce experiment and has candidly shared insights and lessons from the experience – is worth listening to. Remember the LEAD strategy for social commerce begins with L – Listen (Experiment, Apply, Develop) – listening to your users, and to social commerce experience in your category.

Of course, there are plenty of Groupon Clone site scripts for inspiration out in the wild for inspiration and purchase for a few hundred dollars (explaining the myriad of Groupon clones – Microsoft is even getting in on the game), and then there are Group Buy aggregator scripts available if you want to run a specialised Deal Radar or Yipit deal notification service for a particular product category.  And that’s before we consider Facebook applications that let you run Group Buy deals in Facebook.  But what potentially sets the new Group Buy WordPress plugin aside is precisely that it’s a WordPress plugin, a huge user base combined with ease of installation could trigger a wave of new group buy sites.  Plug and Pay.  Group Buy without tears.  And because it’s WordPress, users will not be tied to the original developers for support – although they offer it – the plugin will speak the language of one of the largest developer communities out there.

At the very least – the new Group Buy WordPress plugin should be good for innovation – further democratising the technology in a way that will allow the best ideas, not the deepest pockets, to flourish.  And more importantly for your business in 2011, the plugin could be your long-shot low-cost bet on profiting from the most successful business model of 2010.

Article courtesy of Social Commerce Today

Keeping up with developments in the fast-moving social commerce space can be daunting.  So here’s a quick e-briefing of the latest presentations, articles and factoids of note…

• Paul Chaney on Social Media’s Effect on Holiday Sales: Traffic from Social Sites = 10x Conversion, Onsite Social Tools = +10% conversion, Referral Traffic from Social Sites =  4.39% total.  The keys to monetizing social value -advertising deals in social media and enabling customers to leverage their social graph for product discovery, research, and validation
• Josh Constine on The Year in Facebook-Powered Shopping: Over 50% of top and fastest growing retailers have integrated with Facebook, either through storefront page tabs or open-graph enabled site shopping (like Etsy’s Gift Ideas for Facebook Friends). Over Black Friday weekend, 20% of transactions from student e-tailer Kembrel came through their Facebook store, and these Facebook store transactions were 7-10% bigger than on site shopping
• Wade Gerten on Going Beyond the Inbox with Social Commerce: Between June 2009 and June 2010, time spent online with email has dropped 28%, and risen 43% for social media – US Facebook users spend 1/3 of online time on Facebook. Hautelook’s new Alvenda powered FB store brings news and e-commerce to where people are (i.e. not the inbox), with new FB syndication feature that provides updates to people who like both the retailer and the brand being sold.
• Toby Beresford on the The Seven Basic Social Commerce Actions:  Wish (List), Gift, Group-Buy, Advise, Recommend, Share, Review
• James Poulter on Turning conversations into cash – social commerce and the recommendation economy (Presentation): Three areas of social commerce – social intelligence (using social circle as a discovery engine and decision tool), social capital (shareable assets with cash value - rewards, deals etc), and social buying (group-buy)
• Matt McDougall on Social Commerce in China (Presentation): Two types of social commerce – social layer on e-commerce platforms (Taobao social network), and e-commerce on social platforms (Renren social network has a new group-buy ‘Groupon’ style feature). LUV IT strategy – Listen, Understand, be Visible, use Incentives, gain Trust
• Gary Farmer on Groupon (Groupon Sales Pitch out in the Wild) (Presentation): Groupon: 86% more effective than print, 94% more effective than broadcast, 90% more effective than online advertising
• Janice Diner on Facebook beyond the Wall: Facebook emerging as the primary digital platform for integrated marketing communications – from messaging to transactions, loyalty, reward programs, CRM, and point of purchase (via FB Places)
• Invoke Social Commerce Study (US: n=302 adults, Sep 2010) (Presentation): social networking services are used to source and share product information by 60% of users. 10% of users unwilling to engage with brands via social networks. Product quality, uniqueness and financial incentives are key factors for sharing brand information. Beyond discounts, consumers want to engage with brands as innovation advisors.
• Kimberly Maul on Google Boutiques: Right Trend, Wrong Approach: Personalised stores based on taste, and the ability to follow brands, celebrities and other users is fine, but without a genuine social layer to source buying advice, there’s something missing. The future is Fashism, not Google Boutiques.
• Kaitlyn Bonneville on Should luxury brands explore Facebook as a retail channel? Yes, attractive demographic, coupled with the need to learning and develop. Hautelook has opened up a store on Facebook

Article courtesy of Social Commerce Today

So Twitter is all of a Tweet today over rumors that the Big G (Google) is to buy Little G (Groupon).  Apparently, according to the WSJ, multiple sources close to the situation confirm that Google is in discussions to buy Groupon.  If it happens, a very large cheque will be written, Yahoo has already been turned down with a $2bn+ cheque in hand.

With the launch this week of Google’s groovy and most un-Google-like social commerce platform, Boutiques.com, allowing people to curate their own online designer stores, the purchase of Groupon would establish Google as a leader in the field. And for Andrew Mason, Groupon CEO who has taken the social commerce platform from WordPress blog to $1bn+ in under two years, it could be a smart exit strategy, before Facebook Deals gatecrashes the party.

And actress Demi Moore has bought a chunk of Fashism – the hip social shopping app that gives you instant peer feedback from the fitting room (or bedroom…) on what suits you.  Along with husband Ashton Kutcher, Demi Moore and other investors are putting $1m into the social commerce start up. Social Commerce comes to Hollywood.

And then there’s LivingSocial, the prettier of the two big group-buy social commerce platforms, that has just bought a controlling stake Australian group-buy platform JumpOnIt for $5m.

Consolidation will be the name of the social commerce game in 2011.

So social commerce platforms, download Fashism today, and pretty yourself up for suitors.

Article courtesy of Social Commerce Today