|Wed June 2 2010 08:05:28|
Social Commerce - Phenom or Failure?
By: Ina Steiner
Amazon.com is the king of "boring" shopping, according to Etsy founder Rob Kalin, who made the statement at last week's Disrupt conference. Kalin was speaking on a panel about social commerce, and apparently all the panelists agreed that agreed that Amazon would continue to reign supreme in "commodity commerce," but would not be able to lead social commerce.
In an blog post about the session, TechCrunch pointed to Fashion Vault as evidence that eBay is "horizontally integrating into the social commerce space." I wonder what's social about Fashion Vault flash sales, which leads me to wonder if anyone really understands what social ecommerce is. Commerce itself has been around for thousands of years - is social networking really recreating commerce, or just putting a new face on it?
The author of the TechCrunch blog post about the session wrote, "But the rise of Groupon, Gilt, LivingSocial, Vente Privee and other social e-commerce sites have taught us an undeniable truth that customers are ready for something different. The question is whether Amazon will disrupt its own model in order to preserve its reign as the king."
I'm pretty sure that is the kind of advice people gave eBay a few years ago that led it on a journey of disruptive innovation in which it de-emphasized auctions and small sellers and focused on fixed-price commodities from mega-sellers. There are plenty of people, such as the author of this recent AuctionBytes Letter to the Editor, who believe that eBay's journey of disruption led to the destruction of its original value proposition.
At last week's annual meeting, Amazon.com's Jeff Bezos said his company is focused on the apparel category, and it now offers free return shipping for clothing and accessories for items fulfilled by Amazon. Which means it will be focused on how to reduce clothing returns, since it will be footing the bill, so when I saw this article about a virtual fitting room, I immediately thought of Amazon.
Fitting rooms. Sounds a bit boring. But helping customers try things on for size before purchasing leads to happier customers and reduced costs - something that any experienced online retailer would surely find satisfying.
While startups may dream of social shopping and mobile commerce innovations, Amazon's Jeff Bezos implements things consumers want, no matter how un-exciting. During last week's annual meeting, he spoke about the rather pedestrian topic of same-day delivery, and said that is Amazon's Shangri-la. "This is a place we want to go, but we don't know how to get there." Thinking about how to provide same-day delivery is interesting to him.
That's not to say Amazon is ignoring social commerce, it just integrates it so seamlessly into its site that it doesn't distract from the process of buying something. It's product reviews broke ground by letting customers rate products right on the product page, leading to some surprisingly entertaining content (remember the Three Wolves Moon tshirt product reviews that went viral?).
It also allows consumers to upload product photos and video reviews (a la YouTube). Amazon has always allowed people to make their Wish Lists public, and has launched Facebook Apps such as Giver and Grapevine, an application that lets people publish their Wish Lists in Facebook.
The question becomes, what is the role of social media in commerce and does it really present a new opportunity? Or are merchants distracting themselves with the "Technology Du Jour" of social commerce instead of focusing on the boring (yet profitable) fundamentals of online selling? As TechCrunch asks, did Amazon miss the boat on social commerce - or do they know something the others don't?