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Why Amazon Is the Most Social, Least Social-Friendly Commerce Platform

  |  July 2, 2013   |  Comments

Over the last decade, as Facebook, Twitter, Instagram, and others have redefined the term social beyond commerce-related commentary, Amazon has remained relatively quiet.

Amazon has had the uncanny ability to predict tech trends for almost 20 years. It's one of the biggest reasons that Wall Street has loved the company year after year despite relatively meager profits compared to other tech giants like Apple, Google, and Microsoft.

While most know the company as the e-commerce giant, it is no one-trick pony. It has single-handedly spearheaded the mass existence of multiple markets: one-click shopping, cloud storage, elastic computation, and e-reading, just to name a few. In layman's terms, Amazon has been trend-setting, trail-blazing, and taste-making a dozen times over, staying constantly ahead of the curve.

Yet, for the past decade, Amazon has almost peculiarly avoided one of the largest shifts in technology - the tectonic movement toward integrated social networking. Why?

Social Before Social Was Cool

Before the appearance of traditional social networks like Facebook and Twitter, Amazon provided some of the first mass web 2.0 elements through customer product reviews. It started out quite humbly but rapidly grew into a juggernaut of valuable consumer feedback. In 2010, it was calculated there were approximately six million individual reviews on products, the last time Amazon publicly provided API access to that data.

Today, that number has invariably grown by orders of magnitude, and Amazon's customer base consistently provides just as many reviews as gigantic domain specialists, outpacing Barnes & Noble in book reviews, Walmart in home goods reviews, and Best Buy in consumer electronics reviews.

Even as old-fashioned as this form of "social" is, its impact cannot be ignored. Billions of dollars of gains and losses are directly attributed to the power and sheer quantity of its review library. Yet, over the last decade, as Facebook, Twitter, Instagram, and countless others have redefined the term social beyond commerce-related commentary, Amazon has remained relatively quiet.

And Now Socially Awkward?

For a company that is seemingly on the vanguard of multiple domains, its absence on this front is quite peculiar. As phrases like "social proof" and "curated shopping" have been bandied about, Amazon has stayed on a relatively neutral course. A plethora of communication tools have been ignored - tweets, posts, likes, shares, tags, commenting, friend creation, and the like. It has carefully eschewed the idea of creating complex communal purchasing tools for its user.

Or a (Strategically) Late Bloomer?

Yet, make no mistake, Amazon doesn't typically miss the train on large technological trends. Its absence in the burgeoning industry of social commerce is highly intentional - one that is deliberate and methodical:

  1. Why share something when you can sell it? It has arguably the most widely coveted databases in the world: a record of 200 million users and their day-to-day purchasing habits. Even the simplest of sharing tools would freely expose vast quantities of purchase intentions and shopping habits that vendors pay through the roof to access through Amazon's advertising platform.
  2. Friends or foes? Social platforms increasingly silo their users, ironically enough. Platforms such as Facebook Marketplace create fewer opportunities to capture customer purchasing data and can directly compete with Amazon's goal of being every customer's superstore in the cloud.
  3. What about the trade-offs? While Amazon has never been a company out to make a quick dollar, and keeps its financials as opaque as possible, the benefits of wide-scale social implementation have never proven to make users more "productive." This is in direct contrast to the company's intense desire to make the customer as efficient as possible, from one-click shopping and immediate price comparisons to even building Kindle tablets to make it easier to buy digital goods.

What's Next?

So what's next for Amazon? Pseudo communities such as Svpply and The Fancy have created relatively critical market masses, undoubtedly piquing the company's interest - though a direct purchase of such an entity may not be at the forefront of its mind.

The recent purchase of social reading community Goodreads aside, Amazon has typically looked to purchase companies that have ardent customer bases and are far more "e-commerce" than "social." Strategically, the company will most likely continue to aggressively push affiliate programs and continue to make itself more "social" by allowing other entities to leverage their user database through Amazon Login, all toward the goal of creating the most spend-friendly customer possible.

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ABOUT THE AUTHOR

Himanshu Sareen

Himanshu is responsible for the strategic and overall business development of Icreon. He founded Icreon in 2000 and grew the company through a mix of acquisitions and organic growth. Under Himanshu's leadership, Icreon has grown to become a leading IT consultancy in its space working with some of the world's largest and most influential brands including National Geographic Channel, Fox, PepsiCo, Nokia Siemens Networks, and more.

A strong business-informed technologist, Himanshu has directed Icreon's heady growth through diverse economic climates, dot-com booms and busts, by maintaining a long-term view on relationships, keeping a close eye on the data and business dashboard, and by enabling informed decision-making. Himanshu is a natural entrepreneur. His first encounter with entrepreneurship was a comic rental business at the age of 13. Other ventures he started and exited successfully included an ERP consulting firm, an education-training institute, and a real estate trading business. He has also been as a technology advisor to boards of non-profits and SMBs in New York and globally.

Himanshu is part of the Owners and Presidents Program of Harvard Business School. He received his MBA in international business from the Indian Institute of Foreign Trade. Aside from his work and family, Himanshu is passionate about keeping up with the latest technology trends, physical fitness, and supporting entrepreneurship and the tech community.

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