On the rise of social eCommerce

Deborah Collier published her five predictions for social e-commerce in 2010:

  1. Goodbye to the Middleman
  2. The Year of the Deliver Company
  3. Creative Sponsored Advertising
  4. Mobile Commerce Revolution
  5. Free Culture Frenzy
Her predictions can’t be anymore bang on, if these become a reality of 2010, then we are well on our way to reaching that stage of “Social eCommerce” in the first half of this decade.
As it stands today, our eCommerce networks are all rather isolated and built up silos. We have the Amazons, the Ebays, the Facebooks and the iTunes and App Stores to name a few. Social eCommerce requires these imaginary walls surrounding these walled gardens to come down – and I do expect them to. The reason they will is because as much revenue these networks generate, there is still much more left on the table. We just need to reach out for it.
The elimination of the middle man is a big step. Online applications that have carved themselves a small niche of the market have risen. Not surprisingly these bleeding edge, creative and unique applications are not operated by large corporations, but by the John and Jane Does that have operated them out of their home office or even basements. In today’s online world a business does not need to provide a whole lot of services and products to corner the market – in fact focusing on your niche and a small set of products and services guarantees that you will provide better results. Amazon allows me to sell my books to other people, I can sell my old computer on eBay, or my music on iTunes. There is no middle man involved. I would say the middle man is mostly eliminated at this stage.
Delivery is an interesting service, as it increases with the growth of C2C markets, because the middle man does not exist. We are yet to see a creative, bleeding edge and unique process for delivery. Its a harder problem to tackle, but definitely still possible. I don’t expect this advancement to come from the national postal services. Its tragic, but these creative solutions come out of the basements and dorm rooms of the World. The big corporations are too sluggish and paralyzed to move with the speed required for this sort of advancement.
Creative, seamless and relevant advertisement is a personal interest of mine. The future of online ads in the social eCommerce phase would be heavily wired with the abundance of data on today’s and tomorrow’s social networks. We have some creative advertisement solutions today such as AdSense that would push ads based on the content on the page. That was last decade’s technology, the 2010s need something new that is even more seamless, more integrated, and finally more relevant to me. The only way I can see these advertising engines outdoing themselves is by personalizing these ads. The data to drive such personalization is present, just locked away in these individual silos.
Mobile. Mobile. Mobile. The iPhone has revolutionized this arena. When I went to highschool, not all the kids had cell phone, a good chunk did, but not everybody. I didn’t get my first cellphone until grade 10 I think. Similarly with university, at least the earlier years. Slowly the mobile population grew, but at that time it was fairly uncommon to see a smart phone within the hands of a twenty year old. Today that is different. Now we spend more time with our iPhones, Blackberrys, and other smart phones than we do on our laptops or computers. This is just another bundle of cash waiting for someone to reach out. Those who don’t keep up with these trends will surely suffer. Generation Y is closing in to their 30s and 40s, these are the future customers and they will naturally surround those that provide such services.
The freemium model. Another prediction that is directly tied to Generation Y. Unlike the preceding generation, this generation expects to get basic features for free. This generation does not tolerate the service charges and system access fees. I don’t expect these old fashioned models to remain much longer. Take the service charge I pay to CIBC, what do I get in return for it? Absolutely nothing. On the other hand, they get to invest my hard earned money, make money off it, and then have the nerve to charge me a service charge or fee to take it out? They ought to be paying me a service charge! That model will change. On the other hand, I would gladly pay a service charge to get premium features for my online banking, as well as mobile banking – and by premium I don’t mean printing my paper statement on my screen. Rogers mobile has slowly started introducing such free features to their customers. This includes the “My Account” Rogers iPhone app to monitor my usage, free Rogers OnDemand Online and the ability to tag phone numbers with names on my online billing. Not rocket science, but its an excellent step forward. Stop thinking of the web as e-paper.
In a perfect world, the data I publish on Facebook, could generate sales on Amazon, that will provide recommendations from Ebay along with tunes to match the occasion from iTunes in an experience that is seamless wrapped with personalized ads from Google.
Unfortunately we don’t live in a perfect world, but these visions and ideas can’ t be that far fetched. However, such ideas are a dime a dozen, what is important is how these ideas are executed, and not who is the first to execute them.
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