SOCIAL MEDIA MARKETING STUDY NOTES

Social Media Marketing Overview

Tracy L. Tuten, 5th Edition
Chapter 9: Social Commerce

Key Concepts of Social Commerce

  • Definition:

    • Social commerce is a subset of e-commerce that leverages social media applications to enhance online shopping experiences.

    • It facilitates interactions and collaborations among shoppers during the purchasing process and aids marketers in selling.

    • Components include:

    • Social shopping

    • Social marketplaces

    • Hybrid channels & tools enabling shared participation in purchasing decisions.

    • It allows both buyers and sellers to engage actively in online marketplaces and communities.

Elements of Social Commerce

  • Key Elements:

    1. Ratings and Reviews

    2. Curated Merchandise

    3. Shopping Applications and Venues

    4. Real-world example: Amazon or Netflix algorithms.

Social Shopping in Depth

  • Social Shopping Definition:

    • Active participation in the consumer decision-making process, sharing opinions, recommendations, and experiences via social media.

Consumer Decision-Making Process Stages

  1. Problem Recognition

    • Facilitated by:

      • Social ads on social networks

      • Shared endorsements in activity streams

      • Curated images (e.g., Pinterest)

      • Location-based promotions (e.g., Yelp)

      • Participatory commerce (e.g., Kickstarter)

  2. Information Search

    • Tools:

      • Comments on social channels

      • Ratings and reviews from sites (e.g., Yelp, Zagat)

      • Tagged product and pricing information in image posts

      • Social search queries on networks

      • Sharing wish lists & gift registries

      • Conversational commerce via ChatBot services

    • Note: The vast availability of online information, particularly via social media, has transformed information search experiences.

  3. Evaluation of Alternatives

    • Tools facilitating evaluation:

      • Barcode scanning and price comparisons via mobile apps

      • Recommendations and testimonials

      • Popularity filters and aggregated ratings

  4. Purchase

    • Tools facilitating purchase:

      • Shop within networks (e.g., Facebook Buy, Instagram Shop)

      • Social shopping malls (e.g., Wanelo)

      • Peer-to-peer marketplaces (e.g., Etsy)

      • Group buying (e.g., Groupon)

      • Conversational commerce with ChatBots

  5. Post-Purchase Evaluation

    • Tools:

      • Comments on networks

      • Requests for brand input on social platforms

      • Participation in loyalty programs with social advantages

      • Submission of product ratings on review sites

      • Sharing product experiences through blogs

Importance of Ratings and Reviews

  • Statistics on Consumer Behavior:

    • 95% of consumers read reviews before making a purchase

    • 66% read between 1-10 reviews before deciding

    • 70% of mobile shoppers prefer sites/apps with reviews

    • 82% seek negative reviews to gauge authenticity

    • 60% have checked reviews on mobile while shopping in-store

Review Transparency and Authenticity

  • Concerns:

    • 25% have encountered what they believe to be fake reviews

    • 21% have seen incentivized positive reviews

    • 81% struggle to differentiate between authentic content and native ads

    • Note: Amazon bans incentivized reviews.

Best Practices for Companies/Brands

  • Key Strategies:

    • Authenticity: Accept all feedback, even negative.

    • Transparency: Disclose incentivized opinions.

    • Advocacy: Enable users to rate review value.

    • Participatory: Encourage customers to voice their reviews.

    • Reciprocity: Show gratitude for reviews.

    • Infectiousness: Simplify sharing of reviews

Psychological Influences on Consumers

  • Key Psychological Elements:

    • Social Proof: Fear of missing out (FOMO); individuals copy others.

    • Authority: Influence of celebrity endorsements and reputable sources.

    • Affinity: Liking for a product, driven by reference groups and FOMO.

    • Scarcity: Perception of limited availability drives demand.

    • Reciprocity: Feeling of obligation to return favors or good experiences.

    • Consistency: The drive to align behaviors with expressed intentions.

In-Network Social Commerce Tools

  • Platforms and Features:

    • Instagram: Shoppable posts with in-app checkout.

    • Pinterest: ‘Shopping List’ feature to save shoppable product pins & price notifications.

    • TikTok: Shopping integration with Shopify for product catalog synchronization.

    • YouTube: Supports in-app purchases with livestreams and storefronts.

    • Twitter: Allows brands to showcase products on profiles.

    • WeChat: Mini Programs for direct payments via WeChat Pay.

Final Remarks

  • Companies must educate potential reviewers and create an ecosystem that encourages genuine sharing of opinions without incentivization. #### Psychological Influences on Consumers - **Key Psychological Elements:** - **Social Proof:** This psychological principle suggests that people are more likely to adopt beliefs or actions if they see others doing so, especially their peers. In social commerce, this manifests as the fear of missing out (FOMO) and the tendency for individuals to copy the actions, purchases, or preferences of others. - **Authority:** This refers to the influence that individuals or entities perceived as credible, knowledgeable, or powerful have over others. In marketing, this often involves celebrity endorsements, expert reviews, or recommendations from reputable sources, which can sway consumer decisions. - **Affinity:** Also known as liking, this principle suggests that people are more likely to be influenced by those they like, find attractive, or with whom they share similarities. In social commerce, this is driven by reference groups (people we admire or identify with) and can also contribute to FOMO, as consumers want to align with groups they have an affinity for. - **Scarcity:** This principle states that items or opportunities appear more valuable when they are perceived as rare or limited in availability. The perception of scarcity drives consumer demand, often leading to quicker purchasing decisions to avoid missing out on a limited-time offer or a scarce product. - **Reciprocity:** This is the social norm where individuals feel an obligation to return a favor or a good experience they have received. In a commercial context, if a brand provides a positive experience, valuable content, or a free sample, consumers may feel obligated to make a purchase or advocate for the brand. - **Consistency:** This psychological drive compels individuals to align their current behaviors, beliefs, and statements with their past actions or expressed intentions. Once a person makes a public commitment or takes an initial step (like expressing interest in a product), they are more likely to follow through with consistent actions, such as making a purchase.