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By adaptive - November 27th, 2013
Consumer curated content and the recommendation economy is delivering massive benefits to brands.
Many reports have revealed that the recommendation economy seems to be expanding rapidly with social media at its heart. As we move closer to the holiday season, corporations are asking whether recommendation is as powerful as they are being told.
Indeed, research from YouGov for The Drum seems to show that few social media users will actually be using their networks for gift recommendations. Some 83% of survey respondents in the UK stating that they had no plans to use social recommendations, with just 5% saying they would be actively using this channel to help them shop.
In contrast, research from COLLOGUY seems to show the opposite, with further data from Crowdtap.com stating that 44% of respondents to their research stating that social recommendations would form an important component of their buying decisions this Christmas. Shingo Murakami, managing director of Play.com says: “There’s no one size fits all model, but the trends our merchants have seen in the last year highlight the growing role of social discovery and multichannel offerings in the retail mix.”
There can be little doubt that the power of word-of-mouth has transferred to the social media networks. The YouGov poll sample was small (1,752) but does indicated that brand owners need to work hard in order to reveal how their products and services are being discovered. Facebook remains the most potent channel, so it’s up to brands to realise that social isn’t a panacea, but a channel that needs to be nurtured to deliver real world results.
Hands up who has heard of Polyvore? According to research from RichRelevance this product curation site is now accounting for 20% of the social commerce that is taking place. The service describes itself as a: “new way to discover and shop for things you love. Polyvore's global community has created over 80 million collage-like “sets” that are shared across the web. Polyvore disrupts the traditional e-commerce model by giving everyone everywhere a voice in shaping today's trends and influencing purchases. Our savvy community is ahead of the curve, predicting trends before they hit the mainstream.”
This level of consumer interaction with brands and their products of course was first seen with Pinterest. However, Polyvore seems to be offering consumers a platform that has a wider reach than a Pinterest pin. The RichRelevance research highlights that Facebook continues to have the best conversion rate but Ployvore does take second (1.17%) place ahead of Pinterest (0.96%) and Twitter (0.49%) respectively.
For brands of course conversion is only one aspect of the burgeoning social shopping phenomenon. A closer inspection of the value of the conversions that take place is more revealing. Average order value with Polyvore is an eye opening $383, with Facebook just managing a paltry $90.
RichRelevance CEO David Selinger said: “Social shopping continues to account for less than 1% of total online shopping sessions. The social shopping channel continues to evolve, and retailers and consumers learn to leverage each platform’s unique benefits.”
With RichRelevance’s CMO Diane Kegley also commenting: “Facebook’s audience is huge, so it’s not surprising that they drive a mass audience, with somewhat lower average spend, on retailer sites. Pinterest and Polyvore attract a different shopper – in large part because of the user experience: those sites are very visual and engaging – and in many ways mimic a curated catalog experience with ensemble shopping.”
What is clear is that the self-curating activity that is being seen on Polyvore has a powerful commercial aspect that few corporations can ignore, as they look to leverage their brand awareness to actual conversion and sales. More research is needed to understand the core drivers behind the recommendation economy and why consumers seem to be in buying mode when viewing Polyvore. The future will be a mix of brand driven social commerce and curated content from consumers. As Pinterest has shown, make it easy for consumers to collect and display their favourite products and sales will surely follow.
December 2013, London
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