Socially Responsible F-commerce

As the awareness around sustainability and social responsibility increases, brands are doing more and more to donate to charities and do more for their communities as part of their day-to-day strategies and operations. What is social good? There are many definitions, but the context I am referring to in this e-book is the ability to do good using social media. In particular, Digital Millennials that use social media tend to like to work for companies that emphasize charitable giving as well patronize brands that care.

Brands need to become aware about specific attitudes, perceptions, and sentiments of Millennials as well as how they align their spending with their own interests, passions, and community. Many Millennials say that the charities they support are one of the ways they express themselves. They feel that regularly donating your time to help others in need is a sign of success and accomplishment. They want to know how their donations or efforts will impact others or make a difference. Brands need to enter this type of endeavor with care. Millennials are also very skeptical of brands that take up social causes and may question the true intent of the sponsoring brands. If a brand wants to go down this path, they must make a commitment that demonstrates the ongoing attitudes, behaviors, and actions of the brand.

 Old Navy

Old Navy was founded in 1994 and named after a bar in Paris. The Old Navy Facebook page is intended to be an online hangout for the Old Navy community. There customers and fans can learn about upcoming sales, new styles, contests, promotions, and more. And customers can leave a comment or ask a question on the wall.

Most importantly to their fans, Facebook is a place for their audience to become part of cause marketing programs and social good campaigns. That’s because one of Old Navy’s target audiences is people who truly care about social responsibility. Their Feel Good program appeals to people who are about making the world “Bright, colorful, and playful.” Old Navy connects their sense of style with how they view the world and invites customers and fans to join them in making a difference.

They invite fans to join them at an in-store event celebrating the Boys & Girls Club. A portion of sales during the event go to supporting that charity. They also have “Operation Troop Donation.” This is a program that supports the troops and their families by creating care packages. The Flip-Flop Relay invites customers to bring their pre-loved flip-flops into Old Navy Stores to be recycled into playgrounds. The “It Gets Better” program helps educate people about all types of love. Old Navy donated 10 percent of their Gay Pride t-shirt sales to the “It Gets Better” Project.

While these are not direct e-commerce plays, they are part of a very smart marketing campaign to appeal to a very loyal demographic. A company that shows that they care, that they give back, and that they are “human.” This is a far cry from brands of yesteryear. This kind of humanizing of a brand can create loyal customers and advocates and influencers who spread the “good word” of their company via social media, reaching millions of Old Navy’s target market. And that is essentially the hallmark of understanding and utilizing social media for PR, marketing, and advertising.

Within Facebook, Old Navy has a section called Hot Ticket. Here a fan can enter their name and when they click on submit, they are given a personalized ticket for 30 percent off. That can be shared with their social network, Tweeted, and/or printed out.

Ettitude

Ettitude is an Australia-based company that sells environmentally friendly products made from bamboo and organic cotton. Ettitude was founded on the simple idea that everyday products, such as clothing, bed linen, towels, and stationery, could be made much more responsibly and contribute to making the world a better place, as well as look good and be affordable. Their goal is to give people who care about their family and the earth the ability to easily adopt a greener, more socially responsible lifestyle. Ettitude does this by providing a range of premium and unique eco-friendly products in a quick, convenient, online shopping environment. Because they have such a compelling store, it is a natural for people to want to share this among their social graph.

When I was on their website to do some research for this book, I was impressed with their use of their traditional website as a “Facebook sharing moment.” Here’s how this works: I was on the About Us page, and I went to highlight some words on the site and a widget popped up and enabled me to share what I highlighted with my Facebook connections. This is a brilliant word-of-mouth strategy to create awareness for the brand, and because their marketing message is something people can get behind, i.e., being more socially responsible, the ability to share that website information may even translate into shopping cart dollars.

When you click on the Facebook icon to share your highlighted information, it asks the customer to allow permission to connect to Facebook and post on my Facebook page. The ability to allow your customers to find things they like about your company and post to their friends can be a very good PR and marketing awareness tool. Especially for a company like Ettitude, which has a very share-able brand story around social and personal responsibility.

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we work with brands & software companies to deliver increased revenue and decreased costs.
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Want to see how to get an ROI from Social Media? Check out these fun videos:
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Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

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Some brands have chosen an f-commerce strategy where their main focus is on enabling their regular e-commerce site with social graph Facebook plug-ins so that fans can see on the traditional e-commerce site what their Facebook friends and family like. The reason for including this option in the e-book is that it is an example of how peer-to-peer influence and word-of-mouth in social networks has changed business.

Before social media, a brand depended on advertising, marketing, and PR to get the attention of their customers. Back then the tools of the trade were creating a logo, key message points, and then repeating them in front of customers as many times as a brand could afford—in print, on radio, on billboards, and on TV . . . But as the old saying by Wannamaker goes, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” F-commerce is helping companies learn where their dollars are paying off.

 

Word-of-Mouth Power

And it’s not that people didn’t influence each other before social media. In fact, studies by The Goodman Group, noted experts on customer relations, showed that people on average told 10–20 of their peers well before the Internet became popular. Even back then the calculations for word-of-mouth had huge affects on sales, revenue, and profits. The numbers are impressive:

 

• 71 percent of customers recall a positive experience—more than double the recall of a negative experience
• 42 percent will buy for the first time based on positive word of mouth
• 21 percent will buy more based on positive word of mouth.

 

With the advent of social media word of mouth has increased expontentially. In fact brands have lost some of the power to deliver their key messages to consumers. Before social media, the brand “controlled” the “media” about the brand. But with the new web 2.0-type technologies, customers now contribute to that “media” via social media. In social media, customers can say openly and to millions what they think of a brand and its products and services. This ability has removed some of the control of a brand’s equity from the company and put it into the hands of the consumer.

So today brands must still get in front of their customers and assure that some of the messaging sticks, but they must also engage the help of their social media brand ambassadors to deliver positive messages. They need to engage their fans and the social graph of those fans. Studies show that brands must deliver better products and service via their customer experience, especially now that social media has the incredible reach it does.

 

The Power of Trust

Edelman’s 2011 Trust Barometer®, the firm’s 11th annual survey, gauges attitudes about the state of trust in business, government, NGOs, and media across twenty-three countries. Edelman was one of the first to try to measure how much consumers trust brands. In years past, the Trust Barometer study showed that consumers trusted each other more than brands.

In 2010 the report showed that consumer’s trust in companies did go up, but that generally consumers thought that businesses will probably revert back to their old ways after the recession and not be able to be trusted. The United States was the only country in which trust of companies declined in all types of institutions.

In 2011, the study showed that “consumer trust” protects a brand’s reputation. When a company is not trusted, 51 percent of people will believe negative information after hearing it one to two times.

 

The Value of Social Currency

An article on brands’ social currency, Fast Company author Kevin Randall wrote about How to Measure Brand Value: Likes, Followers, Influencers, Views? No, Social Currency. This article not only pointed to how powerful word-of-mouth marketing is, but also provided a number of methods to determine a brand’s equity and to correlate a brand’s “equity” score with its bottom line, as follows:

1. For a brand’s financial value use Interbrand, Millward Brown BrandZ, Credit Suisse Great Brands
2. For a brand’s equity use Equitrend
3. For brand word-of-mouth buzz/promoting use McKinsey’s method and Net Promoter Score

The Fast Company article added another method to this list, the work done by Erich Joachimsthaler, Founder and CEO of Vivaldi Partners, in their report on Brand Social Currency. Brand Social Currency, as defined in this study, is the extent to which people share the brand and/or information about the brand as part of their everyday social lives at work and/or at home. To measure a brand’s social currency, they use six key attributes:

 

• Utility
• Affiliation
• Identity
• Conversation Advocacy
• Information

 

Erich was quoted in the Fast Company article saying, “Building Social Currency is probably the most important investment companies can make to create value for themselves.” As the author Randall states, perhaps Social Currency is the new, strategic dashboard to help corporate leaders diagnose, build, and monitor the long-term health and value of their “brand assets.”

The study showed a direct correlation between financial performance and the brand’s Social Currency scores. For example, Apple had a high social currency, which is reflected in the company’s financial results. Starbucks, for the fast-food category, also had a high social currency score and traces its 2009-2010 sales growth to a number of recent operational, brand, and social media initiatives.

You can order my complete e-book by clicking here.

Learn. Share. Grow!
@DrNatalie L. Petouhoff

For more info on my work:
Ebook:Social Media ROI

Social Media ROI YouTube Videos:
Video 1: Building the Business Case for Social Media
Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

Book on Monetizing Facebook: Like My Stuff: How To Monetize Your Facebook Fans

Let’s Connect here:
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LinkedIn: DrNataliePetouhoff
G+ : Google Plus posts

 

Facebook offers a variety of methods to do business using its f-commerce tools. They range from the setting up entire virtual storefronts, creating access to existing brand websites, social interaction with customers and clients and brand marketing.

 

Facebook Storefronts

It doesn’t cost a brand anything to set up a storefront on their Facebook pages. Thousands of brands have done this. In this example, a customer starts the shopping trip within the brand’s Facebook shop. At some point in the purchase process, the customer is taken to the company’s e-commerce page or a licensed merchandise marketing and fulfillment service. Examples in this book that have this type of Facebook shopping capability are: Avon, Old Spice, BabyAndMeGifts.com, Ettitude, Livescribe, Best Buy, LadyGaGa, Jennifer Lopez, iTunes, Disney Toy Story, Victoria Secrets Gift Cards, Chile Monster’s Merchandising site, Coca-Cola, Amazon Gift Cards, and the WWE.

Sometimes when a customer leaves the Facebook page and is taken to the brand’s e-commerce site, a new window opens. Sometimes the look and feel changes as a customer goes from Twitter, to Facebook, to the website. You’ll want your web designers to maintain the look and feel of your Facebook Storefront in your e-commerce design for brand consistency.

Some brands, even though the customer ends up on a site external to Facebook, keep the social shoppers inside the Facebook environment longer than others. They do this by using the social interaction features offered by Facebook.

Let’s say a customer is browsing through your product selection. When they find something they like, you can empower them to share it with their friends with options like “Ask Friends” or “Share This.” How does that work? When a customer uses “Ask Friends,” that customer’s comment is sent to their Wall where their friends and family can see it and comment on it.

 

How to Display an F-commerce Store on Facebook

To display an f-commerce page in Facebook, there are two options. A brand can use iFrames or a Facebook app.

 

iFrames

With iFrames, a brand can create, host, and display its own content in a Facebook page in the middle column. The advantage to iFrames? The creation and maintenance of the content and site can be done in-house by the business itself. And it tends to offer the most seamless customer experience for consumers. As many of us have experience as customers ourselves, the ease of use and simplicity in the shopping experience is critical to engaging and retaining customers to follow through and not abandon their shopping cart.

 

Facebook Apps

 

The adoption of smartphones, 3G/4G networks as well as the increase unlimited data plans has accelerated mobile media use. Brands are realizing that another venue to reach customers is through mobile browsers, apps and SMS. As technology advances, advertising will most likely play a major role in the development of the mobile ecosystem that Facebook users count on. In fact, according to comScore’s U.S. study on mobile advertising, they found that the number of advertisers using mobile display ad campaigns has more than doubled in the past two years.

The next trend will be brands that allow full f-commerce via smart phones. One often overlooked aspect is how often a product is forwarded to a friend or posted to Facebook, These actions are quite common within mobile applications, with 4-9 percent of users doing it regularly. Brands need to start thinking about how to reach their mobile audiences while they are shopping. Through Facebook Mobile texts consumers are able to receive notifications, and send and receive SMS. One of the biggest advantage of using an app is the increased amount of space a brand has to show their content and merchandise. For instance, an app gives you 760 pixels but iFrames only allows 520 pixels.

 

Geo Location, Deals and Facebook

 

Facebook has hoped to compete in this aspect of mobile social commerce with their feature

Facebook Places and Deals. Places would alert customers what brick-and-motor stores sold

Products in real time. Deals would offer discounts and limited time offers similar to Groupon

LivingSocial. However, after months of testing, Facebook determined that the market was a bit crowded even for them, and have phased them out – for the present.

 

 

 

Facebook Apps are evolving into one of the most possible segmente of f-commerce. However they are complicated and do require a professional development team to implement. Here a few examples of professionals in the field:.

 

8thBridge. 8thBridge allows a brand to provide social shopping experiences that are portable, personalized, and participatory. The experience across a merchant’s social shopping channel is consistent with the merchant’s existing website because 8thBridge leverages the merchant’s existing shopping cart, payment processing, and order fulfillment systems. This means there is little IT support required from a brand’s tech team. 8thBridge monetizes social media for some of the largest merchants in the world including 1-800-Flowers.com, Lands’ End, Delta Air Lines, Hallmark, HauteLook, and a division of Avon called mark.

 

SortPrice. With SortPrice’s free Merchant Store application for Facebook, merchants both big and small are running Facebook storefronts. The stores are powered by SortPrice technology combined with the product datafeeds. This allows the product information to be easily updated, so new products and price changes are synchronized. Each Facebook store application has an integrated Wishlist which allows Facebook users to save products and share them with friends. Over 1,500 small, medium, and large brands have stores. Among them are OfficeDepot, PetSmart, Loews, and Adobe.

 

Ecwid. Ecwid’s focus since 2001 has been commercial open source PHP shopping cart software. One good thing for small to midsized brands is that it’s also free. The software can be easily integrated to any existing site in minutes and the store can be mirrored on many sites at the same time and managed from one place. Because the store integrates with social networks, brands can run their own store on Facebook. No PHP knowledge is required, and there are no code changes or hosting expenses. Brands include Embe, K&K Photography Gallery, Hello Magpie, RedZero Printing, US21, Cafe Grumpy, and Mammamiu!

 

Usablenet. With Usablenet’s integrated Facebook application, brands can offer any product, service, feature, and functionality currently available on your website within Facebook. Customers can purchase a product, book a reservation, pay a bill, review products and share them with their friends, or provide feedback—without leaving Facebook. Customers include ASOS and JCPenny.

 

BigCommerce. BigCommerce provides e-commerce software to online retailers and merchants. Brand that want to do business on Facebook can use the BigCommerce free application, SocialShop 2. The retail platform shows up as the “Shop Now” tab on the Facebook page. It allows customers to share products with their Facebook friends and buy products within Facebook. Examples are Southern Jewlz, BabyAndMeGifts.com, and Etitude’s.

 

Payvment and PayPal’s Adaptive Payments API. Payvment may be a great choice for small to midsized businesses because it’s also free. Payvment originally was a web service that allowed a site owner to integrate a shopping cart into their e-commerce by adding one line of code to the site. The software allows retailers to create Facebook storefronts. Customers can use credit cards and PayPal. The new paid versions of the software include advanced analytics on Likes, comments, and Tweets on a product-by-product basis. Example Facebook shops are CHiASSO, Amoeba Music, Molly Sims, Hooked on Phonics, AdultSwim UK, Gibson, and Lakers Nation.

 

Storefront Social. This software enables retailers to connect their e-commerce store to Facebook. The brand can upload the storefront banner, choose from a wide variety of templates, feature/highlight products for special promotions, etc. After building the storefront, the connection wizard allows the brand to easily install the storefront to Facebook. Example brands that use this software are Livescribe and Zumba Fitness.

 

TheFind. Who has surpassed Yahoo as the second most popular shopping site? TheFind, according to comScore. TheFind’s mission is to help every shopper find exactly what they want to buy, and to help every merchant, large and small, to reach those shoppers. TheFind is a vertical search engine for shopping that puts every product, every store, every sale, coupon, and discount right at the customer’s fingertips. It provides an in-depth Facebook integration called “Shop Like Friends.” It allows customers to sign into the site with Facebook Connect. It then taps into the preferences of their Facebook Friends and pages that their friends have “liked” on Facebook. It then maps this to stores and brands. In the next chapter we’ll take a look at how f-commerce is different from e-commerce.

 

Enhancing Your Website with Facebook

Another option is to bring the Facebook experience to your company’s website. This allows a brand to tap their customers’ Facebook social network’s connections and interests within the purchasing process. The Facebook-provided buttons have short code snippets that ping Facebook’s social network for information about the customer and their social network while they are visiting the brand’s site. An example of a brand using this Facebook technique in this book is Levi’s.

 

Facebook Buttons & Plug-ins

A brand, to be successful with f-commerce, must use the Facebook social buttons and plug-ins on either their own website and/or their f-commerce stores. Facebook buttons and plug-ins are what make the f-commerce a social commerce experience vs. just another e-commerce transaction. The reason they are such a critical part of f-commerce is because of the difference between a website and a social network. Facebook is not a website. Facebook is a social network. Sometimes people come to Facebook and think it’s a giant website with over 750 million people. And because there are so many potential eyeballs, it’s a great place to put a store. It can be a great place to have a store, but not understanding the difference between a social network and a website will make all your efforts for your Facebook store a waste of time, energy, and money.

A website or an e-commerce site is a site where you display your information or products. The expectation of customers is that they will find what they need from you on those pages. A social network is a social interaction center on the Internet. Within a social network, people expect the ability for two-way interactions. They aren’t interested in your store if all you do is display your products. Customers are looking for interactions between the brand and the customers as well as the ability to interact—customer to customer, friend to friend, friend to family.

The Like Button is one of the first interactions in f-commerce. The standard buttons, while they are not new, are a critical part of getting people to come to your store and buy. Most all companies using f-commerce have you “Like” the brand’s store. In other words, if the customer doesn’t hit “Like,” they can’t get into to the store to see the merchandise. In addition, the Like Button enables users to share pages from your brand’s site back to their Facebook profile with one click. When it’s used with a product page it can entice and influencer a shopper who sees the names and pictures of people in their social network who have also “Liked” that product.

The Send Button allows your customers to easily send your brand’s content to their friends.

Some of the other interactions that you can enable to create interactions within your store are the plug-ins. If you haven’t been using plug-ins for Facebook, you’ll want to spend some time learning about these.

The Log-in Button shows profile pictures of your customer’s friends who have already signed up for your site in addition to a log-in button. The Registration plug-in allows your customers to sign into your website with their Facebook account.

The Comments plug-in encourages your customers to comment on the content on your site.

The Activity Feed plug-in shows your customers what their friends are doing on your site through likes and comments.

The Recommendations plug-in gives your customers personalized suggestions for pages they might like on your site. The Like Box enables your customers to like your Facebook Page and view its stream directly from your website.

The Facepile plug-in displays the Facebook profile pictures of your customers who have liked your page or have signed up for your site.

The Live Stream plug-in lets your customers share activity and comments in real-time as they interact during a live event.

 

These amazing tools, simply yet efficient, have put Facebook in the forefront of the social commerce environment.

Learn. Share. Grow!
@DrNatalie L. Petouhoff

For more info on my work:
Ebook:Social Media ROI

Social Media ROI YouTube Videos:
Video 1: Building the Business Case for Social Media
Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

Book on Monetizing Facebook: Like My Stuff: How To Monetize Your Facebook Fans

Let’s Connect here:
Twitter: @drnatalie
LinkedIn: DrNataliePetouhoff
G+ : Google Plus posts

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Facebook as a Marketing Funnel

Many businesses are investing resources into building a Facebook presence for their brand to engage with fans, advocates, ambassadors, press, influencers, and customers. The question for most businesses is how to move the page from just a PR and marketing awareness page—in the traditional marketing funnel—to a consideration and purchase page, thereby increasing the marketing conversion rates into solid, traceable sales.

A typical Facebook user spends a good part of their day on Facebook. And according to Compete.com, 68 percent of people become fans of retail pages to keep up to date on sales and promotions. So what’s the logic for a business to provide e-commerce on Facebook? Many businesses realize that if their fans are on Facebook to connect with family and friends and to engage with brands and receive coupons and deals, it may make sense to provide the ability for fans to purchase products, too.

In terms of real businesses today on Facebook, there is a wide range of how e-commerce is being handled. They range from Facebook shops selling items such as airline tickets, beauty products, baby products, clothes, and specialty BBQ sauces, to offering the ability to participate in charity donations and buy tickets for shows. Businesses are using the Wall as a shop “window” as well as to actively promote and purchase products on the shop tab itself.

To give you a good understanding of how companies are using f-commerce, the following chapters are packed full of practical examples. I’ve captured screenshots to illustrate how the brand uses Facebook and what the customer sees and can do. Having concrete examples helps to demonstrate the “how-to” part of using Facebook for e-commerce.

It’s highly recommended that you take the time to go online and click through the pages as you are reading the book. This will give you a more experiential feel for how brands use f-commerce. And note, some of the Facebook pages and stores may have changed by the time you are reading this book. That’s how fast things happen in the social networked world.

What’s the financial return for f-commerce? Some businesses are seeing as much as 20 percent of overall online sales coming via their Facebook stores as well as higher cart values as compared to traditional e-commerce venues. That in part may be due to the influence of friends, family, or colleagues and the recommendations that come from people they know, versus an unidentified stranger’s review on e-review or e-opinion sites.

Facts about F-commerce from SocialCommerceToday.com

• Top 3: The top 3 brands on Facebook (by fans) all sell directly on Facebook—Coca-Cola (24m), Starbucks (20m), and Disney (19m)
• 2–4%: f-store conversion rates—on a par with web-stores (avg. 3.4%, according to Forrester/Shop.org)
• $650,000,000: The drop in Netflix share value when Warner opened up a Facebook movie rental (streaming) service in 2011
• 1,000: Number of diapers P&G sold on its f-store in under an hour
• 50,000: Number of retailers who have opened an f-store with Payment
• 6 hours: Time it took for the Rachel Roy Facebook jewelry store to sell out
• 3rd highest: daily sales made by Rachel Roy, the day it opened it’s pop-up f-store
• 1m+: Starbucks customers using their e-commerce-enabled Facebook CRM loyalty program
• 1,300: Number of products added every week to the ASOS f-store
• 20%: Proportion of black Friday sales transactions on Facebook for e-tailer Kembrel
• 7–10%: Increased Average Order Value for Facebook transactions (vs. web-store) for Kembrel
• 5000+: customers using Walmart’s group-buy Facebook app on the day of its launch
• $34: Amount paid for the first transaction ever to take place on Facebook at 11:50 a.m. EST on July 8, 2009 for bouquet of flowers ‘A Slice of Life’ on the f-store of U.S. florist 1-800 flowers
• 76%: percentage of retailers who plan to use Facebook for ‘social commerce’ initiatives
• 50%+: proportion of the global top 100 websites that have integrated with Facebook using its social plug-ins
• 50,000+: Number of websites that integrated Facebook social plug-ins (incl. ‘Like’) in the week they launched
• 2.5 million+: websites now integrated with Facebook
• 10,000: number of new websites integrating with Facebook every day (with social plug-ins) since April 2010
• 2m+: Number of sites that have integrated Facebook social plug-ins
• 7 out of 10: proportion of digital marketers who have implemented or are planning to implement Facebook Like feature

Relevancy: Know Your Audience

Often understanding what is interesting and relevant is best found by asking customers directly. Too many PR, marketing, and advertising firms think they know better. They don’t take the time to do the account planning or research to really understand their audience, their behaviors, their motivations, and drivers let alone for traditional campaigns. Enter social media. If a brand does not listen and understand their online audience, the results can be devastating. That doesn’t mean a brand should not enter into the social media realm. It means they need to go back to school and understand the differences between online and offline customer interactions and the viral nature of a scorned customer.

Brands need to make sure they have someone on staff who understands how to do primary audience research in both social media and traditional methods. Qualitative and quantitative methods of traditional account planning and audience research include:Focus groups

• In-depth interviews
• Polls
• Surveys, both on- and offline
• Ethnography/netnography (observations off- and online of the audience behaviors)

Social media monitoring tools like Radian6, Sysomos, Tracckr, etc. lend themselves to account planning and audience research, especially for:

• • Primary Research (research conducted by the brand itself)
  • Sentiment and share of voice online
  • Identification of the top influencers, advocates, customers, brand naysayers, and press
  • Polls, surveys, and netnography
  • Topics influencers and advocates are discussing about the brand
  • Customer issues, questions, suggestions, and praise for the product, service, and the brand
  • Secondary Research (research conducted by other people than the brand)
  • Studies other research groups or institutions have produced on the brand or product category that the brand falls into (consumer products, automotive, etc.) and the customers associated with those groups.

In addition, conversations within online communities, either owned by the brand or third party communities, can reveal very interesting insights for the brand. Of particular interest to this book on f-commerce is the use of community applications within Facebook. An example of a community application used within Facebook is Get Satisfaction’s Facebook Solution.

Because the Wall in Facebook changes so quickly, brands end up answering the same questions over and over. The Get Satisfaction Facebook widget allows brands to not only avoid spending time repeating the same answers on the Wall (because questions and answers can be searched on and retrieved), but instead can focus on creating relevant content and interactions that engage customers to participate and make that brand part of their lifestream. I can’t stress how important creating interactions with your customers are. Facebook is not a website. It’s a social network where people socialize with each other and with brands. It’s not a broadcast medium where a brand can send out marketing messages. It’s a medium where customers go to exclusively to interact with each other and with brands.

Most social media monitoring tools can only provide Facebook data that is on public pages. Because of the partnership between GoodData and Get Satisfaction, the brand can obtain intimate knowledge of the conversations on their Facebook pages between the brand and its customer’s. And, if the brand has included the Get Satisfaction widget on their website or other communities, that data can also be aggregated.

If a brand doesn’t take the steps to understand their audience, there is no guarantee that the social shopping experience will yield good business results. Why guess, when you can know?

Engagement

In the old days, marketers counted on a customer perhaps telling ten to twenty of their friends about a product or service. Today with the social web, one customer’s comment, negative or positive, informs thousands and sometimes millions of people. And reports show that year after year, consumers generally trust the opinions of people they know more than they trust anonymous ratings and reviews posted online. And in comparison, they trust online banner ads and advertisements even less. Social commerce or f-commerce is the opportunity to leverage word of mouth to increase the awareness of brand and drive customers through the consideration and purchase funnel.

Brands must begin to think from the social customer’s point of view. Customers who use social media are constantly being bombarded with invitations to new social networks. They have to decide where to spend the little free time they have. This means that a brand must provide their social customers direct engagement that acknowledges their understanding of their customers in the social web as well as reward them for that participation in the social experience created by the brand. Customers who do encounter great social experiences influence other customers. That influence can multiply across their social graphs and spark comments, conversations and purchases

I hope you’ll keep reading along with me! In the next chapter we’ll take a look at how f-commerce works.

You can order my complete e-book by clicking here.

 

–
Learn. Share. Grow!
@DrNatalie L. Petouhoff

For more info on my work:
Ebook:Social Media ROI

Social Media ROI YouTube Videos:
Video 1: Building the Business Case for Social Media
Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

Book on Monetizing Facebook: Like My Stuff: How To Monetize Your Facebook Fans

Let’s Connect here:
Twitter: @drnatalie
LinkedIn: DrNataliePetouhoff
G+ : Google Plus posts

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Why is it important for brands to have a Facebook e-commerce capability? Mike Fauscette, an Analyst at IDC Consulting says, “In three to five years, 10 percent to 15 percent of total consumer spending in developed countries may go through sites such as Facebook.”

Why might Fauscette make this prediction? Facebook users spend 700 billion minutes per month in an active, relaxed environment. The average Facebook user is connected to 130 friends. They belong to 80 interest groups. Through their detailed profiles and by posting on average 90 pieces of content per month, Facebook users make their preferences known. Word-of-mouth (WOM) recommendations or buyer-beware messages are prevalent.

Today’s social customer is not shy about posting their thoughts about a brand, its products and services, or the experiences they have with the brand. The unique selling opportunities Facebook can offer has gotten the attention of digital marketer’s and PR professionals. As social media plays an increasingly more important role in purchasing decisions, brands are allocating larger parts of their marketing budgets to engage with their consumers on platforms like Facebook and Twitter.

Many brands, big and small, are wondering if they should go down this path. How is this different than the e-commerce they already offer? And does f-commerce mean that you have to get rid of your traditional e-commerce platform? Are there pitfalls to social commerce or commerce on Facebook? It’s these and other questions we will address in this e-book.

Be Where Your Customers Are

For many brands, Facebook is where their customers are online. And the mantra in social media? A brand needs to be where their customers are within the social net. A brand can’t expect that their customers will come to them (or their site.) The theory of f-commerce is that customers should be able to buy wherever and whenever they like. If they are on Facebook then they should be able, among many other things, to purchase products while they interact with their friends and family.

Some people have questioned whether it’s even possible to sell customer products in the midst of them using Facebook to catch up with their friends and family. Perhaps that’s all people want to do while on Facebook, i.e., they don’t want their social network to sell them stuff while they are socializing. And if that is the case, then perhaps brands should keep their commerce offerings on their e-commerce sites.

However, while some people are of the opinion that people visit Facebook just to catch up with their friends and family, a  JWT (James Walter Thompson) study showed that 48 percent of millennials (aged 20–33) would like to buy directly on Facebook from the places they shop. In a another study industry study, 25 percent of customers aged 18–34 years old stated they use Facebook to interact with merchants. How many companies are planning to increase their funding for social commerce according to this study? Ninety percent will increase funding for social commerce initiatives by 8 percent.

There is a trend, and that trend is the blending of social networks with e-commerce. The skill with which brands do this will directly affect the success not only for their own individual brand, but for the industry as a whole. If social networking shopping sites are not delivered in the spirit of what the customer wants, it will fail. If not for this point alone, brands need to pay attention to f-commerce as an example of how shopping can be integrated within a social network.

The Future of One-Stop Facebook Shopping

So let’s say you have a vacation coming up. You want to look for good rates on airline tickets. What’s the difference between logging onto an airline website vs. being able to research and purchase tickets inside of an already established social network? First, you may want to ask your friends what airline they flew on, how the service and food was, and what to watch out for. You might find that information on a travel site, but you may not be able to ask your friends their opinions.

So the point is that when you are on a regular e-commerce site you may be just getting the “take” from people you don’t actually know. This input is important, because you aren’t just trusting the brand’s marketing spin. You are getting the take of other human beings. But on a social networking site you are connected to your friends and your friends know you and the things you care about the most. You also might want to make plans with a group of people and instead of sending a bunch of e-mails, you might want one place for everyone who is going on the trip to chime in, to plan, and to orchestrate the festivities. Doing so could make coordinating lots of people easier and fuel the enthusiasm for the trip.

If you went the traditional route, you’d think about which airline you think you’d like to travel on. You might also think about your favorite travel site, knowing that there are a number of them that aggregate fares and try to provide the best possible deal. So you make your choice and log onto the airline or travel website.

Hopefully you’ve saved your log-in name on the computer you are on or you can remember it. It might depend on whether you’ve been to that site before or not. That might also depend on whether you have an account with them or not. If you can’t remember your log-in name then you have to either ask for a password reset or log in as a guest. The first option takes time. Not a lot of time, but it can “feel” like a hassle with all the sites and passwords we all have these days.

Once you’ve chosen that path, then you start your search for dates and times for your destination. Once you’ve researched that, you choose a flight and pay for it. Then there’s the step of entering the payment information. That entails your credit card or PayPal-type account information, your billing address and TSA information. If you are renting a hotel and/or a car, that same payment scenario might have to be repeated for each of those transactions unless it’s integrated.

In this short scenario, using Facebook could help to lessen the hassles of the travel transactions. With Facebook’s f-commerce tools, you could get the opinion of your friends about each travel item: airline, hotel, car rental, even restaurants in the area. Then you could just hit a Facebook button for each—either while on your laptop, desktop, tablet, or phone and be on your way.

Why? Because you are already logged into Facebook, and so have a community of like-minded people to help. Then, since your identity and payment details are already authenticated within Facebook, completing the transaction is as simple as pushing a few appropriate buttons.

If your business could take advantage of f-commerce to make your customer’s experience as quick and easy as possible, think about the spike in revenue you’d get.

Social Network Fatigue and Opting for F-commerce

The business decision to use Facebook as part of your e-commerce strategy depends on where you think your customers are going to be online. With more potential consumers on Facebook than there are people logging into eBay and Amazon combined, many companies are betting on the fact that once customers are in Facebook they won’t want to leave to shop. With the number of sites people log into each day, this may well be the trend of the future—meaning that people are starting to suffer from social network fatigue.

The reasons for this fatigue include how time consuming it is to log into a bunch of different sites as well as to remember your passwords. Another contributing factor is time allocation. One of the things that most people don’t talk about is the amount of time out of their life social networking takes. While it may be easier to keep in touch with more people and see what is happening with them via Facebook, Twitter, Google+, and LinkedIn, it does takes time out of one’s day.

Having too many social networks means that people may not want to go to a bunch of different sites or URLs. If people have the choice to log into one place to interact with their friends and family and then are required to go to other places to shop, they may opt to participate in a social network that includes not only their favorite brands, but also the ability to buy products and services from them.

How Facebook Could Provide Better CRM

Knowing who the people are and details about them allows Facebook to provide customers with an interesting and entertaining online experience, but also provides businesses with information on likes, dislikes, and preferences in the context of their personal and professional relationships. This is different than the data businesses have gathered from traditional Customer Relationship Management or CRM systems.

CRM is an acronym that stands for the relationships companies build with their customers during and through the process of marketing, sales, and service. Having social data augment the CRM system could constitute what many call social CRM. While there isn’t any one vendor that truly provides best-in-class social sales, social marketing, and social customer service all in one suite, the concept of combining social data with traditional CRM data could be the missing link to driving more customers through the marketing funnel and getting a return on investment for social media.

Facebook Social CRM
Social networking sites like Facebook have massive amounts of individual and social crowd data. That data means something because people have signed up using their real identity. In forums or other crowd-oriented communities, people sometimes remain anonymous. So one of the first advantages of f-commerce is that people are using their real identities.

In addition, Facebook started as a site to connect with other people and part of finding people to connect with is to see what they have in common other people. Most people who put up a Facebook page include some personal preference information. This initial data can be very important to companies in understanding their customer’s behavior through knowing about their hobbies, what they like in music, food, travel, and a wide variety of other interests.

Companies using Facebook as a marketplace not only have people who have identified themselves, but also user data and analytics that reveals what people talk about, and with the right analytics a business could extract even more data about them as potential customers.

Many businesses have just focused on using that data to display hyper-targeted ads. And while there is value for this, the idea that Facebook could be an online virtual mall where friends ask friends what to buy, share what they bought, and thereby influence word of mouth is a reality for many brands.

Facebook’s Potential for One-to-One Marketing

One-to-one marketing has long been the dream of many marketers. In fact two of my favorite authors, Don Peppers and Martha Rogers, wrote several books about it, including The One-to-One Future: Building Relationships One Customer at a Time, and The One-to-One Fieldbook: The Complete Toolkit for Implementing a 1-to-1 Marketing Program. The theory was that with competition for customers fiercer than ever, with products and services only a mouse click away, with so many choices, and with many products becoming commodities, customers’ loyalty changed. As a result, the way a brand could attract and keep customers would be to personalize how they marketed and sold to a customer. That field of endeavor became known as one-to-one marketing.

While most brands bragged about how customer-centric they were, in reality many were at a loss for identifying and attracting a loyal and profitable customer base. CRM (Customer Relationship Management) systems back in the late 1990s were supposed to provide the infrastructure necessary to support one-to-one marketing. There was a lot of marketing hype around the features, functions, and benefits of CRM software.

The issue with CRM systems then was that they were more like a CTM, or customer transaction management system. They didn’t have all the rational database information that marketers could readily use to provide personalized relationship marketing and certainly not enough of the personalized, one-to-one marketing data.

Most companies implemented operational CRM, meaning they had a database of contact information about their customers. And that information definitely helped with marketing. But most companies didn’t deploy analytical CRM, meaning the type of CRM that would provide the analytical wisdom about your customers to enable one-to-one marketing and sales. Out of the frustration for the lack of that data developed the field of business intelligence or BI. Separate BI point vendors began to specialize in gathering and mining data about customers to be used to drive customers through the marketing funnel. An industry that was successful at this was the Las Vegas casino system. They developed loyalty programs that could measure the offers sent to customers and subsequent behaviors. Studying these patterns allowed marketers to direct their one-to-one marketing efforts very effectively. But most industries failed to excel in one-to-one marketing.

Fast forward to today, where we now have Web 2.0-type technologies that allow interactions between brands and customers. With the enhanced Facebook Open Graph API and supporting tools that it announced in April 2010, Facebook can be seen as a social CRM system. This is especially true if you define CRM as the opportunity to do personalized, one-to-one marketing, sales, and service. What has been missing in CRM is the relationship between the customer, their likes, dislikes, and their friends and family in a context where their reactions and comments are honest, authentic, and updated daily.

Facebook API: A Graph of What People Care About

Imagine that Facebook is a graphical representation of connections between people, photos, liking, sharing, commenting, shopping, and the interrelatedness between them and their friend and family relationships liking, sharing, commenting, and shopping. If you took a picture of each of those things and pasted it on a piece of poster board, you’d have a visual representation of that person’s life and what’s important to them as well as poster boards of their friends and families and what is important to each of them as well as the overlaps in interests. This is called a “social graph.”

Facebook offers businesses a way to connect to that information via an API. An API is an acronym for application programming interface. Instead of having to write a bunch of complicated code to connect to the data, you just have to connect to the API. The API provides a much simpler way to access the information.

The Facebook Open Graph API allows you to easily access all public information about a person. This means that it can retrieve the likes and interests of your customers, and your customer’s Facebook connections. And thus the social graph data provides marketers new ways to understand a customer’s preferences, passions, and connections and by doing so allows a brand to create a personalized experience with each and every customer.

For instance, a customer might live in Los Angeles, listen to Sting, work at Citibank, ride bikes along the Santa Monica Pier, eat at the Cheesecake Factory in Marina Del Rey as well as connect with their network of friends and family. With the Facebook Open Graph API, brands can make personalized offers to that individual based on the information he or she has shared on their page.

Deals that might interest this customer are mortgages or refinancing information from Citibank, coupons for free drinks at Cheesecake factory, a sale on bikes or bike accessories, and a special appearance by Sting on the Santa Monica Pier. With contextualized data like this, brands can customize their marketing campaigns based on the information customers share about themselves.

Another example is that a brand might show the upcoming birthdays of Facebook Friends as well as their gift Wish List. How would a brand populate this list? The brand can access that friend’s profile data, which might include a list of their favorite electronics, clothes, food, and music as gift suggestions. Normally, it would have to create a system that would ask the customer directly about their favorite items, then get permission to use this information. The Social Plug-ins, mentioned earlier in this chapter, allow a brand to build the social graph by seeing what the customer “Liked” on Facebook. That is assuming the customer opts to share this information publicly among their own individual group of friends. Brands seeking to use this information would need to ask the Facebook member to share this information with them as well.

The downfall to getting data is the individual Facebook privacy setting. Each Facebook page’s privacy settings are handled and decided upon by the customer who owns the page. Customers are asked to provide permission to allow their page to be seen by the brand. This determines who can see what. I’ve included some screenshots in the case studies in the following chapters so you can see how brands ask for permission to see what a customer is talking about.

Join me on Friday when I get into part 2 of chapter 1!

You can order my e-book by clicking here.

 

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Learn. Share. Grow!
@DrNatalie L. Petouhoff

For more info on my work:
Ebook:Social Media ROI

Social Media ROI YouTube Videos:
Video 1: Building the Business Case for Social Media
Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

Book on Monetizing Facebook: Like My Stuff: How To Monetize Your Facebook Fans

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