Conventional approach to social commerce has been to treat it as yet another channel to advertise and sell. While moderately effective, this approach completely misses out on the true power of social media.

Think about the last ten posts you clicked on Facebook or Twitter. Now think about who they were from? Chances are they were all from your friends and not one of the posts you clicked on was from a brand. Yet most brands continue to focus on optimizing these posts as their core social media strategy. Go figure.

If that anecdotal example was not good enough to convince you, here is some research data showing just how much trust users place in posts by companies or brands on social networking sites. Only 15% of the users in US trust such posts. Europeans, true to their reputation are even more cynical at 10% trust level.

Source: Forrester Research

While the “push communication” from brands ranks the lowest, the same communication from friends and family ranks the highest in trust level. And therein lies the true power of social media.

The first generation of social marketing strategy was about optimizing and managing the content brands push out. The next generation of social marketing strategy is about brands tapping into their audience for content, and then use that content for marketing results.

“There’s a revolution in marketing, people are in control.”

-Marc Pritchard, CMO of Proctor and Gamble.

How do you get users to generate content?

You have to turn your social strategy on its head. Rather than thinking about pushing commerce on social platforms, think about how to integrate social on your commerce platform i.e. your web site. By natively integrating engaging social apps on your eCommerce site, you can increase user engagement, conversion rate and create word-of-mouth branding.

Fred Wilson, from Union Square Ventures observed in his blog:

“When a retailer or e-commerce service implements a highly social layer into their service with hooks into the major social platforms, the conversion rates can be significant. I have seen this first hand. This is an indication that users enjoy and benefit from social commerce when it is built into a native e-commerce service.”

With investments in companies such as Twitter, Etsy, Tumblr and Foursquare, one has to assume Fred really knows what he is talking about.

Specific social commerce strategies proven to generate impactful ROI

Here are a few ideas we have seen work really well for adding a social layer on your site:

1. Proactively ask and encourage users to Like and share your products. It is a good idea to add a little incentive. You are getting them to market your products, it only makes sense to allocate some marketing budget towards that. This strategy has three significant benefits:
   1. Word-of-mouth endorsement. As we discussed earlier, this is the most trusted form of messaging.
   2. SEO benefit.  Research has shown that social sharing is now the #1 driver for SEO rank.
   3. User insights. You can get users to do a FB Connect with your app for product sharing action. This will give you valuable demographic data on the users including gender, DOB, location, Likes and more.Note, that each individual post has a small reach. Therefore in order for this strategy to be effective, you need a LOT of sharing action. Adding a passive “please share my products because they are so beautiful” button doesn’t work. You will probably get around 0.1% sharing rate which is not big enough to make a dent in your business. By making it more proactive and adding an incentive, you can increase the sharing rate to 3-5%. That’s when it becomes really impactful.
2. Enable users to poll their friends for buying decisions. A large number of users don’t complete their purchase because they are not sure about their product selection and want to get an opinion from their friends or family. Giving them an easy way to create a poll has the following benefits:
   1. Increase in conversion rate by converting indecisive shoppers into buyers.
   2. New customer acquisition. As users share the poll with their friends, these friends get exposed to your brand and products.
   3. Market research. You get access to friends’ comments on polls which talk about their likes and dislikes.
   4. Lower return rate. By enabling users to make better buying decisions, you reduce the return rate for your products.
3. Encourage users to share their purchases with friends. This is the strongest form of social endorsement you can get. The user is telling her friends that not only does she like the product, she likes it enough to purchase it. There is also an implicit endorsement for your site. The benefits here are similar to product sharing except this is a higher level of endorsement.
4. Display a shopping community. This is a live feed showing what other customers are buying. It can be highly engaging and addictive. Benefits include:
   1. Higher AOV. Users end up discovering products they were not really looking to buy.
   2. Higher conversion. Seeing that other users are buying a given product in real time creates huge social endorsement.
   3. Higher engagement. There’s something inherently engaging about seeing what other’s are buying.

Have you implemented any social applications on your site that have worked well? Please share your tips below.