Most of us would agree that the internet is biased towards social connection, yet many e-commerce or f-commerce experiences are not. In the olden days, bazaars weren’t only about consuming “stuff,” but were a social space to meet up with friends and exchange information.
Today, instead of a peer-to-peer economy, we have relationships with our brands. We don’t learn what’s happening in our world, but instead learn how much smaller the new iPad is.
The mom blogosphere in particular has risen to fill that void, up to a point. Bloggers and readers exchange ideas, rumors and facts that matter to them, but companies quickly co-opt the majority of well-intentioned blogs to sell more stuff instead of creating more social value. Ultimately, such actions have degraded blogs to what we have today: a list of product features and giveaways.
Companies do this because of their inability to embrace nuance, being solely dedicated to the dollar. You can see this play out in how companies structure themselves. Many companies create an e-commerce site that is simply an inventory list with no social value whatsoever. This means that many other companies can then take advantage of those sites because they don’t offer anything except a price on a product. So those other companies rise up another level of abstraction and become a search engine or aggregator, which creates even less value than before.
What we’re seeing now, as a result of the recession, is that you can’t just keep abstracting how you make money at a higher and higher level. Indeed, each time we distance ourselves from the most basic of human interactions – that is, a face-to-face conversation – the more dangerous it is for our economy.
Take a look at Appaloosa, a hedge fund that employs 250 people and Apple, a company that employs about 35,000 people and earned around $6 billion in 2009. “Appaloosa, the hedge fund, earned about as much as Apple in 2009 by speculating on… well, we don’t really know,” argues Jeffrey Hollender.
And many would argue it was just that kind of speculation – or abstraction – that got us into all of our financial problems in the first place.
For e-commerce and f-commerce, this means an opportunity to pivot to new models by combining commerce with community to replicate the peer-to-peer economy, where value isn’t limited to dollars and point of sale, but expands to include the concept of sharing and access just as it would in real life.
Ultimately, that is what every e-commerce site should be doing – not attempting a relationship between brand and customer, but enabling connections and conversations between customers.
Which even in this age of social media, very few companies do successfully.
11 replies on “Why E-Commerce Needs to Stop Aggregation and Start Getting Social”
Good post. To continue along your line of thinking, I’ve found that with startups, at first it’s about making real friendships as opposed to sales (especially when there’s nothing to sell).
Absolutely, Patrick. I think the majority of business is built on relationships, but somehow e-commerce is not representative of this at all. And it’s working right now, but do we really want to live in a transactional society? I think not. Somehow the social values were stripped when we brought commerce online.
Very good point and something, I never really thought of. I host a few giveaways on my blog because they’re brands I enjoy and when appropriate, I love being able to give back to readers. However, I say no everyday to random brands with “no soul,” who reach out and essentially want to use my audience and readership to toss something at them that isn’t relevant.
It’s time they start changing their model. Let’s see if they do…
Thanks, Grace! A couple things – it’s interesting to me that most companies that say they are trying to change their model (getting into e-commerce or socialize their commerce) believe that putting up a Facebook storefront (f-commerce) is all that it takes. Putting a like button on a product does not make it social.
I want to talk more about this in a future post because it’s obviously changing how we interact and what’s acceptable in a fundamental way.
I also really think the whole giveaway trend is fascinating. I’ve done giveaways on my old blog and the company I work for hosts a lot, but they have such short-term benefits for both blogger and company, and the reader, that I just don’t get it nowadays. I guess because it’s easy and attention grabbing? It’s still not social though – still a one-way bullhorn. I don’t know, lots to think about. I’ll get down off the pulpit now…
“Putting a like button on a product does not make it social.” True that.
Curious, why do you think these giveaways have “short-term” benefits? Is it because social media has a sometimes difficult ROI? If someone hosts a giveaway or even writes about a new sponsorship going on with Alice, (let’s say) that’s exposure and potential new clients. Do you find you just don’t get new clients from it or it peaks at day one, then fades away with the noise?
Great question. Yes, you don’t get that many new customers and yes, those that you do come fade away with the noise. Ultimately people that want to purchase your product or use your service – and stick around – aren’t going to need a giveaway to entice them. (I think a similar corollary that many bloggers can relate to is when they get a good day as a result of StumbleUpon).
What I think is more troubling is how we’ve built a deal-centric culture that is created and continues to be fed by aggregation engines and further levels of abstraction. The ultimate futility of giveaways are a by-product of this model.
(Again, similar corollary in blogger terms, the abstraction happens in the traffic numbers, followers, subscribers – all the data that we want to have the most of and we judge each other by those numbers. We judge influence by highest number and commerce by the lowest number.)
Anyway, when you deal in aggregation and abstraction, the customer is less and less loyal to any particular business or brand and just goes for the best price point. What happens when you do that is you strip the experience of any social value entirely. And increasingly, you strip a product’s value too.
That’s why I’m stunned more people aren’t paying attention to how things are structured and built (more on that in another post), because the frameworks are deciding our behaviors.
I’m stunned more people aren’t outraged by where things are going. Now you’ve got me all excited again! Ha.
Do you think the idea of a giveaway or feature on a blog are completely archaic then? I have a hunch that it works for some products/brands, especially if they’re supplementing with other PR efforts, social interaction, events, etc.
I really agree that a customer will stay with you and buy from you, no matter what. However, how is a giveaway different than a press release? The type of people that see it? The medium (obviously, but still asking)?
I have had readers e-mail me or mention that they had never heard of X brand (giveaway or not, maybe I write about them or even tweet) and that now that I mentioned it (they trust my opinion, etc.) they are a new customer and love it. that seems to be viable… no? I also understand this probably doesn’t scale (one-offs), but a big enough voice or following, could really change that for a brand.
No, not at all, but can we figure out more authentically social ways to go about it? Absolutely. And I expect the market will necessitate that soon enough because there’s so much noise.
I think a press release, traditionally, was a backgrounder for a journalist and then the journalist would call and ask more questions to learn more and then write a story. A giveaway on the other hand usually doesn’t have that extra level of interaction. And increasingly people are just re-printing press releases (ugh).
Brands will tell their stories; I think we have to be careful to inject our own stories back into that so we don’t fall victim to corporatism. You’re good at that in your blog (which is appreciated and gets results), but for how long? It’s my experience with the mom blogosphere (and I think that niche is generally indicative of where other bloggers will end up) that they will increasingly become more abstract as well as let more brands in the more successful they are. Readers respond because it ‘s a marker of influence (since when did hocking goods become a measure of influence though?!). Do you see then that there is a vicious circle? I haven’t really thought this area all the way through, but those are my initial theories…
There is SO much noise.
It sounds like a lot of the tools and resources we have used or are using are antiquated and it might not just be giveaways. This is of course, what you’re getting at and that there’s a greater need for more creativity and true interaction (besides just tossing up a product, giveaway, then be done).
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