Social Commerce 101: Leverage Word of Mouth to Boost Sales

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Social this, social that - it seems all marketers hear about these days is social networking, social marketing, and social interaction online. But what does the "social" moniker mean for your business? How does the customer voice really impact bottom-line sales?

In this ongoing column, I'll explore a concept called "social commerce." Unlike the broad brush of social media - which is a catch-all phrase for word-of-mouth activities of all kinds - social commerce is the strategy of connecting customers to customers online, then leveraging those connections for commercial purpose. In other words, social commerce moves the word-of-mouth needle from "buzz" to "buy."

Social commerce in the broadest sense is the strategy of facilitating customer interactions and participation in ways that will drive measurable business results. The word "commerce" paired with "social" reminds us that a smart social marketing program is measured, operationalized, and optimized - and meets its goal of driving customers to purchase.

As a social commerce marketer, your job is to:

• Craft the messages and provide the social platforms (social networking pages, blogs, forums, etc.) to get people talking about your brand, products, or services online.
  
  
• Let these conversations unfold, but also encourage participation through promotions, contests, ratings and reviews, user-generated content (photo and video) uploads, and whatever else drives social interaction.
  
  
• Analyze the conversations to find out what people are saying and why, to spot trends, and to find out exactly what customers want.
  
  
• Deliver products, services, and promotions that meet these needs.
  
  
• Continue to get customer feedback, and integrate these findings with sophisticated analytics and marketing measurement tools to pinpoint exact return on investment of social programs.

As a former retail marketer at Dell.com, I'd suggest online businesses are not all that interested in driving shopping, but rather traffic, conversion, average order value, loyalty, satisfaction, and competitive differentiation. These are the metrics that lead to lasting sales growth. Social commerce allows companies to leverage their brand advocates and the content they create as measurable, impactful digital marketing assets.

This column will be a place for marketers to learn practical, actionable tips for setting a social commerce program in action - and strategies for optimizing the program over time to drive a lasting impact on P&L statements. Most marketers already have several social programs in place: a Facebook page, a Twitter account, perhaps a company blog, and ratings and reviews on their Web site. Maybe you've gone so far as to measure which of these programs is delivering the most traffic or the highest conversion lift. But the ultimate goal in building an impactful, measurable social commerce program is to integrate all social marketing activities with your larger marketing programs (online, in-store, mobile, direct marketing, and more) so that all of your marketing initiatives work together to deliver one common goal: bottom-line sales growth.

To get started on building a social commerce program, there a few best practices marketers can implement right away.

• Start with user-generated content around your product. By encouraging people to create and share content about your products and services, this content becomes a digital asset that can be used in multiple product marketing tactics. Online retailers have found that customer reviews are the most effective user-generated social tactic for driving sales because there is high demand for this content by shoppers. In fact, 81 percent of online shoppers sought out reviews before purchasing.
  
  
• Expand your customer-voice focus outward from your Web site; implement customer feedback initiatives via mobile apps, on Facebook and Twitter, and on partner Web sites. People should be able to talk about your brand wherever they are, driving sales in all channels.
  
  
• Leverage customer feedback in all of your marketing initiatives. If someone says something positive about your brand, products, or services - use it. Integrate positive commentary into paid search and display ads, on in-store signage, in catalogs, in e-mail campaigns, and anywhere else you interact with your customers.

Those are just a few tips to get you started on the path to social commerce success. In upcoming columns, I look forward to delivering proven best practices, real-world case studies, and forward-thinking strategies to help make social commerce a core component of every marketing program.

Sam is off today. This column was originally published on Feb. 9, 2010 on ClickZ.