Amazon, Best Buy, Dell Among Top Social Brands

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What brands are leading the way in developing commerce initiatives around social media? Amazon, Best Buy, Dell, Hallmark and Starbucks were the companies cited most often in a survey of executives involved in social strategy at 123 large companies by digital consulting firm Altimeter Group.

While no one company has social commerce "figured out," Altimeter found that by industry, services companies are at the forefront, followed by apparel and footwear companies and consumer electronics businesses. CPG and food and beverage companies are still at an early phase of tapping social media to sell products.

What is social commerce, anyway? The Altimeter report suggested that the term is best defined by what it's not: simply an extension of B2B e-commerce or traditional marketing efforts. "We see it as a new channel, and a new way to influence shoppers," reads the study. "We believe it is enhanced through e-commerce and m-commerce convergence."

The opportunity for social commerce extends beyond interactive marketing to improving in areas like customer service, product development and even manufacturing, according to Altimeter.

The firm's report identifies four phases of social commerce development:

  • "Let's Be Social," where programs are launched to drive brand advocacy and boost market share.
  • "Enlightened Engagement," when e-commerce is connected to social platforms to influence influencers.
  • "Store of the Community," where fans drive product selection and services via social networks.
  • "Frictionless Commerce," when brands redesign the shopping experience across channels and categories to create a truly customer-centric offering.
The report places use of the Facebook "Like" button in the second category of development. "The 'Like' button from Facebook is a simple and effective mechanism to get feedback on programs, products and services. While Levi's was an early pioneer in adding the Like button to its own Web site, we are now seeing rapid adoption of the Like button across sites," read the report. (About 2 million sites have installed the Like button to date.)

Altimeter cited programs by Delta and Best Buy as examples of the highest level of social commerce. For group travel, Delta created a Facebook page that lets people incorporate personal connections into their travel planning. So a soccer coach, for instance, can figure out who should sit next to each other, communicate with parents, and send special instructions to the airline. The report also points to Best Buy's efforts to connect online and offline shopping through mobile applications like Shopkick that allow customers to earn and redeem points toward purchases and scan in-store items for more information.

Social commerce will reach its full potential through the use of gaming, 2-D tags, social couponing, mobile apps and mapping technology, according to the study. To build a foundation for social commerce operations, Altimeter advises companies to "build more near real-time and accurate process for inventory management, transparency of quality information, and return policies into your operations." Of course, that's all probably easier said than done.

The report's findings were based on "54 qualitative and 123 quantitative responses" from people actively involved in social strategy and interviewed between April and August 2010. Half the companies in the study were retailers and half were manufacturers, and all had annual revenues of more than $500 million. Departments represented included marketing (24%), sales (35%) and IT (41%).

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