social commerce presentation

UK Social Commerce

Overview

• What is ‘social commerce’

• Drivers of social commerce

• E-consultancy’s survey

• Figleaves case study

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Ratings and Reviews

Wikis Social Networks

Tagging

BlogsPeer-2-peer

Facebook

User-Generated Content and Social Media Have Exploded

The Next Explosion: Social Commerce

• Put simply, social commerce is about customers having the means to interact with one another in order to make better buying decisions.

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Factors Driving Social Commerce• A shift in influence from traditional media and corporate

speak to people listening to their peers.– Consumers are seen as communication channel– Consumers are authoring brand messages– In effect, working for the Marketing department and generating the message

in addition to carrying it.

• The consumers have a voice– Consumers now can not only influence purchase decisions, but they can

also influence product design

• Convergence of stakeholder roles– Consumers are more invested and therefore more loyal to companies and

brands

Social Commerce Report Research Methodology

• Produced by E-consultancy in association with Bazaarvoice

• Surveyed 800 respondents over a three week period (June – July 2007)

• 360 respondents classified themselves as online sellers

• 80% respondents were based in the UK

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The Current E-commerce Landscape

• 50% of online sellers say they expect 20% or more online sales growth in 2008*

• For multi-channel companies, online accounts for just under a third of all sales*

• Online sales in the UK amounted to an estimated £46.6bn in 2007, up from £30.2bn last year, according to the IMRG.– Online sales will reach an estimated £78bn a year by

2010.

*E-consultancy / Bazaarvoice Social Commerce Report 2007

How are Companies Reacting?

• 67% say that a social networking strategy is a high or medium priority

• More than half of all online sellers (51%) consider UGC as either ‘extremely important’ or ‘very important’ to company strategy over the next year.


Online Sellers’ Adoption and Consideration of Ratings and Reviews


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Online sellers that are using

ratings & reviews

Online Sellers that are

considering the use of ratings &

reviews

Online retailers that rank ratings & reviews as a high or medium

priority

28% 52% 80%*E-consultancy / Bazaarvoice Social Commerce Report 2007

What About Negative Reviews?

4.3 out of 5

Importance of Ratings and Reviews to Consumers


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How important are consumer reviews when

making a purchasing decision?

Would reviews impact the

likelihood that you buy from

that site?

Do you find ratings and

reviews helpful when making a

purchase?

61% extremely or very

important

55%“Would be more likely

to buy”

63%Yes

Source: UK Consumers, Vizu.com Polls, N=100+

Benefits of Ratings and Reviews

Benefits of Ratings and Reviews

0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00%

Higher conversion rates

Improved retention and loyalty

SEO benefit Ideas for product/services

development Differentiation from

competitors Lower costs to serve customer

Reduced returns rate

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Percentage of respondents rating as ‘major benefit’ (Social Commerce Report 2007)

Case Study

• Founded in 1998

• World’s largest seller of branded intimate apparel

• Carries over 200 brands of lingerie, swimwear, sleepwear and hosiery for women and men

• figleaves.com offers a shopping experience that is highly personalised, engaging, fun and backed by an award winning level of service

• figleaves.com puts the consumer at the centre of what they do

Implementation of Ratings and Reviews on figleaves.com

• Launches Ratings & Reviews Jan 2007

• Drive reviews through dedicated landing pages, on-site offers and email campaigns

• Customers are engaged – 73 reviews for Fantasie bra

• Average rating of products is high – 4.5 out of 5

The Results• Product Coverage

– Shoppers on figleaves.com want Ratings & Reviews. figleaves.com has a significant 43.9% product coverage (and growing!)

• Review Volume Growth

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figleaves - UK Review Volume Growth

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figleaves - UK Review Volume Growth

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figleaves - US Review Volume Growth

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figleaves - US Review Volume Growth

The Results

• The same products with reviews have a 35.27% higher overall session conversion rate.

• Conversion was not negatively affected for products without reviews

Overall Average Before Going Live

Overall Average After Going Live

The Results

• The Look-to-Book ratio is 4X lower (better) for products with reviews compared to those without

No Reviews

11-205-101-4 21+

4X

Look-to-Book ratio shows the percentage of people who visit a website compared to those who actually make a purchase. This ratio is an excellent measure of ratings and reviews ability to influence the consumer to make a buying decision.

Look-to-Book ratio shows the percentage of people who visit a website compared to those who actually make a purchase. This ratio is an excellent measure of ratings and reviews ability to influence the consumer to make a buying decision.

Social Commerce Context Examples

“This 'social commerce' is creating new and more meaningful ways for retailers to interact with customers. Search, communication and community have the potential to have an even more powerful impact on commerce when closely tied together.”

~Ken Goldstein, CEO of Shop.com

Questions?Linus Gregoriadis, Head of ResearchE-consultancy.comEmail: [email protected] Website: www.e-consultancy.com

social commerce presentation

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