social commerce

Social commerce is a subset of e-commerce that uses social media to assist in the online buying and selling of products and services. In other words, it is a mashup of e-commerce and social networking, integrating best practices in catalog, merchandising, and shopping cart processes with consumer-to-consumer (C2C) engagement, content sharing, and social activity.

Examples of social commerce include customer ratings and reviews, user recommendations and referrals, social shopping tools, social media optimization, social applications, and social advertising. Technologies such as Augmented Reality (AR) have also been used with social commerce, allowing shoppers to visualize apparel items on themselves and solicit feedback through social networking.

Historical perspective: According to Fred Cavazza in Forbes, social commerce existed through Amazon and eBay, and the foundations of social commerce were established years ago in the book Cluetrain Manifesto: "Markets are conversations." He identifies six practices associated with social commerce:
1. Buyer community - GDGT
2. Group buying - Groupon, Living Social
3. Purchase sharing - JustBoughtIt
4. Curation - Polyvore, Pinterest
5. Social advice - Fashism
6. Co-shopping - Shop Together app

The term social commerce was introduced by Yahoo! in November 2005 to describe a set of collaborative online shopping tools such as shared pick lists, user ratings and other user-generated content sharing. Online marketers like the idea of getting advice from trusted individuals (word-of-mouse) because research shows it increases the users' trust in one retailer over another. It's considered the Holy Grail of marketing: Making your customers your marketers.

Social media experts say the very notion of shopping on a retailer's website will become dated. Expecting people to come to your website is expecting them to make an extra effort. If you want to participate in social commerce, you need a commerce presence on a social networking site.

Historical perspective: Facebook unveiled plans in June 2019 to launch a secure, scalable, and reliable cryptocurrency, according to The Wall Street Journal. The social media company is working with 27 corporate partners on developing a digital payment system, called Libra, for users to buy things and pay each other all around the world. The currency would be backed by a basket of global currencies, and thus cushioned from the volatility of other cryptocurrencies that aren’t pegged to anything, such as bitcoin.