Few Retailers Are Bagging Social Commerce Opportunities
Major retailers are failing to put enough social media bags in their e-commerce shopping carts, according to a new report.
Market research firm Interpret LLC found that 22 of the top 25 online retailers offer some form of a “flash” sale on their websites, with a limited-quantity item made available for a short time at a deep discount. Yet those same retailers have yet to carry out discounting strategies like those pioneered by social commerce sites such as Groupon, Gilt and ideeli, Interpret said.
The success of social commerce sites can be attributed to how effectively they employ a tactic called “collective buying,” when a set number of shoppers must buy a retailer’s coupon before the discount becomes valid.
Zak Kirchner, senior research analyst at Interpret, said the most successful online retailers—which the firm’s publicly available report didn’t call out by name—“are not using social media to promote their deals effectively.”
“Unlike dedicated flash sites Groupon and Gilt that have leveraged the social web to achieve strong flash sales success, very few of the major retailers have used social networks to promote their flash sales, which is a missed opportunity,” Kirchner said.
However, a social commerce wave is set to crash onto the shores of retailing. A survey by research firm Altimeter Group showed that 86 percent of 135 top retailers and consumer goods plan to launch some sort of social commerce strategy by 2011, according to Dow Jones Newswires.
The Interpret report came out the same day as Facebook executive Ethan Beard predicted in an interview with Dow Jones Newswires that social commerce “will be big and disruptive.”
Social commerce already is making a dent. A recent report from comScore indicated that 23 percent of Twitter users follow businesses to find special deals, promotions or sales, blogger Brian Solis reported.
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