New industry statistics confirm what the media has been buzzing about past few months: the social commerce space is a hot ticket. Social Commerce Today reports that social commerce startups received about $1.93 billion in funding since the beginning of this year.
What’s going on here? Of course, business funding fads come and go. And these sexy ventures are known to flame out pretty quickly. Standard businesses that produce tangible products and services grow more slowly, but nonetheless keep growing and have a future. But it’s clear we’re seeing a shift from the social-networking models which merely emphasize community, toward actually monetizing services that can be leveraged by communities.
This is also the latest evolution of e-commerce and online business, which goes beyond simple buyer and seller transactions to encompass collaborative activities, such as (as defined in Wikipedia) social shopping (co-browsing), collaborative purchasing (collective buying power), collaborative filtering (social recommendations), and even collaborative funding (e.g. Crowdfunder).
The payback from social commerce — integrating social media with e-commerce — can be found in increased customer satisfaction, reduced stress on call centers, and viral marketing. ROI arises from the fact that many customer inquiries and issues formerly handled by paid customer service or tech support representatives will be offloaded to “super users” or “influencers” within the community. Customer service representatives also can see a productivity boost as well, as potential issues and problem resolutions will be unearthed and posted by community members. These community members also will tend to be more satisfied and engaged customers……