Paul M. Banas on Consumer Insights, Marketing Research, and the Digital Media Landscape
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The Social Aspect Of Online Retail

Versus visiting a mall or any other type of shopping center, many online retailers tends to be singularly focused on one aspect of shopping, the final purchase.

There is no sense of wandering through the aisles, watching others as they shop, or having someone with you to provide advice.

What is missing is the social aspect of buying something, which is one of the foundations of the Web 2.0 experience.  And for some online retailers who are not optimized to take advantage of this, this is a missed opportunity.

According to a recent Guidant\Synovate eNation study, more than 60% of respondents report being drawn to online retailers that employ Web 2.0 tools and techniques.

Online Shopping Sites

These social tools include soliciting feedback and providing recommendations on products and services, along with welcoming them and making them feel part of a community.

The reason why this is critical is that word of mouth is one of the primary influencers in having a consumer purchase one product over another.

According to this Nielsen Online Global Consumer study, recommendations from consumers are the most trusted form of advertising out there, along with consumer opinions posted online.

Most Trusted Forms of Advertising

An enhanced online shopping experience isn’t necessarily fancier graphics or flash programs.

The best online retail experiences are the ones that lever one of the most important aspects of offline shopping, the social aspect and the opinions of others.

10 comments

1 shammara { 07.21.08 at 10:04 pm }

Great overview. What do you think people consider are social features? Is it cross-selling like on Amazon..”people who liked this also liked..” etc. Or is it forums, yelp-type profiles, etc.

2 ron { 07.21.08 at 11:38 pm }

In the next 2-5 years we will see more and more social aspects in the online shopping with tremendous influence on viral marketing and long term relationships. It doesn’t make sense to shop “alone” and to make the entire buying cycle “alone”.

3 Paul M. Banas { 07.22.08 at 8:57 am }

@Shammara
Good question. I actually think it’s a continuum, with the latter being the more social, since it feels more like a true exchange of communication between actual people.

Recommendations from Amazon’s shopper algorithmns are more like social segmentations and provide social validation, versus a true community. That’s not to say that shoppers don’t value what they provide, it’s just different than true peer feedback.

4 Paul M. Banas { 07.22.08 at 9:00 am }

@ron
I agree with your prediction, and the online retailers who lever this will be the ones who pull away from the rest of the pack.

5 shammara { 07.22.08 at 3:36 pm }

That’s an interesting point, however I can’t really imagine a world of every online retailer turning into a social networking site. It seems people do want to get in and get out fast, and get the best product for the best price. Not necessarily stick around, make friends, talk about and exchange recommendations for products. Though, in certain niche social shopping sites like Kaboodle,ThisNext, it seems to attract that crowd.

People on Amazon and other sites that offer reviews (like our site, Buzzillions.com), are guiding each other on what to buy through reviews. We offer a ‘review snapshot’ which is essentially a summary of all the reviews, showing the pros/cons/ and best uses for the product.

But who knows, perhaps better social tools and discussion forums will be more available for the passionate users within shopping verticals..

6 Paul M. Banas { 07.22.08 at 6:41 pm }

@Shammara
I think you are right, that some dynamic communities can arise in niche social shopping sites. When I was in the market for a new DSLR, I found sites such as Digital Photography Review and Nikonians to be invaluable. The give and take on some esoteric topics was great.

But I also found one stop shop aggregators (such as Buzzillions.com) to be great ways to link reviews and great prices from across the web, all in one place. I think a role for both will always exists

7 shammara { 07.22.08 at 6:49 pm }

Yeah, I agree. On forums like dpreview, mtbr, etc. you’ll find the most passionate users offering great advice. Probably why Amazon bought dpreview, since both types of buying advice is needed and created by different types of people.

I’m curious as to which review sites you typically go to? If at all..

8 robojiannis { 07.28.08 at 4:56 pm }

would this mean, that we should also expect web 2.0-like advertising?
we are witnessing it in a sense, but I wonder if it would expand into something beyond networking.

9 Paul M. Banas { 07.28.08 at 9:07 pm }

@robojiannis
Your already seeing it, and while it generally has networking at its core, it comes in many different variations. Things such as Alternate Reality Games and Nike+ are basically large scale and very complicated ads.

I also think to be Web 2.0, they have to provide some value to a consumer. Just talking at someone with an ad, even if its online, is still very much traditional (and not Web 2.0) marketing.

Good to hear from you again. BTW, very cool new look for your website!

10 The Influence of Reviews { 07.29.08 at 1:15 pm }

[...] There’s a lot of great buzz around consumer reviews lately, as more market researchers and retailers see the benefits of giving customers a public voice. I had a great exchange of ideas recently with Paul M. Banas who writes a top content marketing blog Insight Buzz on the topics of consumer reviews and social elements of online retail. [...]

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