Sharing With Others
Social shopping sites are proliferating and two new entries are trying to break into the crowded space. Pete Cashmore at Mashable! has the scoop on new entry ThisNext which he says
mashes up features from all these sites, but switches the focus to product recommendations. Is that enough to make them stand out from the crowd? I’m not sure.
ThisNext is basing its business on a proven aspect of eCommerce, that Customer Reviews increase sales. Yahoo and OMD found that 12% of prospective customers read customer reviews before buying products. The problem with ThisNext is that like many other social sites that function on votes or reviews(Digg), it seems ThisNext is really only providing value to companies besides itself. I even stumbled across one of our clients, Elsewares, getting some love from the ThisNext community.
I will again turn to Mashable! for a look at Crowdstorm, especially since in this case the service is still in Beta. From the review of Crowdstorm:
Crowdstorm is basically a cross between social networking, a Digg-like voting system and a shopping search engine - you submit products to the site using a form, and others can vote for the item by hitting the “recommend it!†button.
Great, sounds fun and will most likely lead to more people buying products online, although the more likely effect is the same people buying more products online. Again, I only see two options for this to be a profitable idea. The first is to inundate the site with sponsored items and advertisements, which would most likely turn off the user base. The second is to develop a reputation for their technology and sell this to an established eCommerce store/stores or firm.
Bottom Line: If you’re already selling online you realize what an open market it is. Sell great products and the immense amount of communication will only help, provide poor products and service and you will go out of business that much faster. We don’t know which of the social shopping sites will survive, but some will and as an eCommerce store owner you need to be ready.
Posted by Chris | August 22, 2006
Amazon Releases New Feature for Associates » eCommerce Cache :: Varien eCommerce Blog :: A blog focused on the design, marketing, and implementation of online commerce August 30th, 2006
[…] I fully agree with Mitch, but I can still see this being a valuable tool for recommending products to friends or perhaps anonymous blog readers. The social recommendation idea reminds me of sites like ThisNext, which allow you to create pages of products you recommend. The big difference being Amazon participates in revenue sharing with owners of aStores. […]
MySpace Creates Customers?: Discussion Ensues » eCommerce Cache :: Varien eCommerce Blog :: A blog focused on the design, marketing, and implementation of online commerce September 1st, 2006
[…] The social aspects of shopping are a major way the online and real-world differ. Instead of asking your friends if they like a particular product you can now read reviews from hundreds of customers. New social shopping sites like ThisNext and Crowdstorm aim to create communities based entirely on shopping. The difference of course being that MySpace is sending traffic to retailers through pay-per-click ads, while ThisNext is still ad-free. TechCrunch points out that the numbers go some distance towards proving that young people using social networking sites are interested in shopping through links on those sites. […]
Social Commerce is Up and Running » eCommerce Cache :: Varien eCommerce Blog :: A blog focused on the design, marketing, and implementation of online commerce September 6th, 2006
[…] Crowdstorm, a site pointed out to us by blog Mashable!, went live today. The social shopping site allows people to rate products and create a “Buzz” around them, as crowdstorm puts it. However, I still don’t understand the business model behind the site. […]
Social Commerce: The Business Plan » eCommerce Cache :: Varien eCommerce Blog :: A blog focused on the design, marketing, and implementation of online commerce September 11th, 2006
[…] The New York Times has an article on social shopping sites, based around a profile of ThisNext. The Times finally answers a nagging question I have posed here before; how do they plan on making any money? The social shopping sites hope to parlay that enthusiasm into advertising revenue, once they attract enough visitors to go back to merchants with a better sales pitch. Some sites, like ThisNext, also plan to form so-called affiliate relationships with merchants, who often pay percent commissions on sales that come as a result of their products being featured on other sites. […]