Retail executives from 1800Flowers.com, Totsy, and Caboodle joined sponsor dotbox to discuss social commerce trends during Social Media Week in New York City in February.
During an event welcome, Ashley Heather, Founder and CEO of dotbox shared his thoughts on the rise of social commerce. “Commerce has been social since day one,” he noted. But the Internet rapidly changed the way the consumers interact with and experience retail brands, Heather added. dotbox, panel discussion sponsor, is a New York City-based agency that provides e-commerce organizations with solutions to integrate social media.
During the session “Social Commerce: The Evolution of the Purchase Process” Heather and a panel of social commerce insiders discussed how the AIDA (Awareness, Interest, Desire, Action) marketing model is rapidly being transformed with the evolution of consumer behavior and technology shifting. Consumers are empowered to develop a more authentic connection with brands and products. With the integration of social media and e-commerce, consumers are now building dynamic conversations around products and services through viral messaging to their social networks, altering the traditional model from a linear to a circular process. During the presentation panelists discussed how social commerce has played a key role in the evolution of AIDA.
“Social commerce is beyond buzz,” Heather noted. “It’s reality — the new form of commerce. The consumer journey has changed.”
How AIDA Works
Heather began the explanation of AIDA by stating that social Awareness is now driving supply and demand based on interests and preferences. He mentioned companies like Threadless that are switching the traditional model to leave it up to the community to decide what products are “hot.” Threadless allows its community members to design shirts that are then voted on by friends, and ultimately the shirt with the greatest number of votes gets produced.
The next step in the process is Interest. To gauge interest among community members, Wet Seal has introduced a Farmvile-like approach to shopping, called “Chic Boutique.” Shoppers can create their own “store” of items they like to solicit feedback from the community. They can make more informed purchased decisions empowered with opinions from their peers. Wet Seal uses the channel to collect market intelligence by finding out what products shoppers are interested in seeing in stores.
When consumers graduate to the Desire aspect of the AIDA model, it’s about social conversation. Once they have read about and researched a product, they showcase it for opinions.
“Go out and look at social content, user-generated, ratings, reviews, context of products, likes on Facebook — users are [leveraging the intelligence of the social sphere] to make purchases,” Heather said.
The final step in the AIDA model, conversion, or Action, has changed dramatically along with different purchase models that have evolved, such as Groupon, where the volume of shoppers interested in buying triggers the “deal.”
“The transition from the old world to the new world of the buying cycle is not days or weeks; it’s done in minutes and hours,” Heather said. “That’s the benefit of having all the information at their fingertips because they can make decisions much more quickly. It’s essentially e-commerce, but with a new business model and new tools to helps consumers.”
Case In Point: Totsy, “Gilt.com For Moms”
Totsy is a private sale site for moms, which make them widely dependent on buzz for success, according to CEO Christophe Garnier.
The site capitalizes on the virally-driven nature of the mom community, as moms share with each other three to four times more than average users, according to Garnier.
“Our site is comprised of moms looking for advice, seeking recommendations from peers, to get the best information,” Garnier said. “Sixty-four percent (64%) of moms look for special deals before making a purchase, 55% of moms on the Internet hold out to buy things until they’re on sale.”
Totsy’s invitation-based model encourages community members to invite friends with a $15 incentive, which, Garnier said, has enhanced organic growth 35% every month since the site’s inception just 14 months ago. The site houses a network of more than 500,000 moms, 35% of whom have been invited by existing members. Totsy pushes messaging out on Facebook and Twitter to extend its content reach — 60% of the company’s marketing team focuses on community management.
1800Flowers.Com Ups The Ante Online
The online florist is focused on building meaningful interactions by creating a place to collaborate, find gifts and services and ultimately purchase them. Jon Mandell, Director of Online Media, said the company is focused on being more transactional by providing multiple channels on which to shop. 1800Flowers.com added a birthday integration, so Facebook users can shop for friends when they’re notified of an upcoming birthday.
The 1800Flowers.com community, Mandell said, is a place the retailer can “Listen, fix and respond,” and let customers know that issues are resolved. “We want to allow for word-of-mouth marketing to happen, but on our site,” he said. “We want to build trust through engagement and enhance ourselves as a gifting destination across all our brands.”
The florist also is allowing customers to dictate supply and demand. Product assortment is selected by a key metric — the “Like” button on Facebook. Majority vote rules and the most popular products end up in the catalog. Facebook community members can now purchase within the newsfeed via the retailer’s Facebook Storecast, by filling out all relevant purchase information directly on the news feed, without having to click away to purchase.
“We adapt to trends and opportunities as it applies to our resources,” Mandell said. “Social media is ubiquitous. It’s not one thing. You tap the opportunities and different types of marketing that you can be doing to reach customers. Social networking is not social commerce, but it’s a component of it, and gives customers the tools to have a great experience.”