Still seeking social commerce October 29, 2012Posted by David Card in Uncategorized.
Tags: e-commerce, social commerce, Social Media
Fancy, a site that looks a bit like Pinterest, but invites brands and merchants to sell the items “fancied,” has raised an over-$26 million round of funding, according to SEC documents. Another social commerce play, Pickie, that aggregates social recommendations a bit like a Flipboard for shopping, announced it is launching on Apple’s App Store with a $1 million seed fund. And last week, Facebook closed down its Pinterest-like Collections test, claiming it was doing so not because it was a flop but because it was analyzing early results in preparation for re-launch as a real service.
We’ve written that Pinterest could likely thrive – if not challenge Amazon or eBay – by connecting some dots for merchants and retailers, even if it just scraped by on affiliate fees. But building a large company while being a middleman for other middlemen like retailers leaves pretty thin margins and/or requires huge scale. Some data show that Pinterest is highly engaging for would-be shoppers. And Facebook has its own data to make the case to sellers for its advertising, and its Offers product.
But most e-commerce is directed. Search, price transparency, and comparison shopping are complemented by reviews and recommendations, from friends or otherwise. Social commerce feels like impulse purchasing. Facebook storebuilder Payvment cites analysis that impulse purchases represent the majority of offline retail. But that’s impulse purchases made in stores, not in social gatherings or quasi-magazines. Social commerce that weaves threads across channels, where consumers shop as well as browse, will likely be the real payoff.