Social Commerce- Network of Frienemies

October 7, 2010 § Leave a comment


“This is a conversation, not a one-night stand,” said Sarah Hofstetter, senior vice president for emerging media and brand strategy at 360i, a digital advertising agency.

By “one-night stand” Sarah is referring to the selfish little tricks companies play using social media sites as another medium to distribute advertising, and pretending to intend to befriend its customers. It is pretty easy to go low and view each interaction as a potential money-making chance. For the first time, companies find a vast pool of customers so accessible that not exploiting every opportunities of selling seems nothing but idiotic. It is like being in a Victoria Secret’s party and not even trying to flirt with one of the super models.

So strong discipline is required. Trust plays a vital role. Building mutual loyalty is more beneficial for the long run – if you want your customers to be loyal to you, then you must do the same. Just like Sarah said “If you’re in this community, make sure you’re contributing to the maintenance of that community.”

Here is the story. J CREW launched an advertising campaign in September, featuring mix and match of apparel, accessories and cosmetics just like All of those items were available for purchase. But J. Crew only profit from the sale of its own products. The other goods were merely recommended to its customers and once clicked would direct them to the website of another store.

J. Crew is playing a trustworthy stylist who offers fashion tips for its clients, while promoting its own clothes at the same time.

Internet has changed our buying patterns. The giant web connects and gathers all the information so accurate and deliver it to potential buyers so fast that no vendors could avoid the test of  comparison of prices and qualities. Websites like Shopstyle and Productwiki could simply do the trick. Competition is not about reaching the customers ASAP, it is about selling lifestyles and the characters of a brand. That’s why J. Crew wouldn’t mind displaying similar clothes from competitors on its website.

Social commerce is not a new concept. It was first introduced by Yahoo! five years ago to “describe a set of online collaborative shopping tools such as shared pick lists, user ratings and other user-generated content-sharing of online product information and advice“. However, it is rare for enemies to become frienemies overnight – advertising for oneself as well as competitors. Companies like J. Crew won’t mind that by recommending competitor’s product, it may drive away a certain flow of its revenues, as long as a meaningful relationship – trust and loyalty – is built between the brand and its customers, which would benefit J. Crew much more in the long run.

It is a genius approach. It would be better if a company could set up a website like that of Polyvore or even better Polyvore with professional stylists’ opinion. In that case, once the reliance upon the website for fashion tips is established, the store could simply slip more of its own products into the tips and downplay other brands. A rising tide lifts all boats. All you have to make sure is that your boat is lifted higher than the others. After all, competition means more market share and more profit, not the bankruptcy of your competitors.


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