(The Beginnings of) Social Commerce

There have been a few recent developments in “social commerce,” and I believe that we will (hopefully) see a number of new ones in 2006. For me, I view social commerce as one subset of “advertorial content,” where content is the advertising. (I’ve been writing about this notion recently (here and here), and believe that there is a great deal of power behind it.) With social commerce specifically, what better way to advertise a product than to have a friend recommend it to you? When a product is directly integrated into becoming content itself, it bypasses the normal filter that consumers put up to ignore or at least be skeptical of the advertising. And when this advertorial content is generated by a friend, a special element of trust is integrated into the advertorial relationship that wasn’t present otherwise.

I would consider Amazon to be one of the pioneer in social commerce, introducing(?, or at least popularizing) the Wish List and “Tell a friend about this item” features quite a few years ago now. The company’s recent addition of tags adds another social component to their existing commerce offering. Yahoo explicitly pursues social commerce with their Shoposphere and Pick Lists initiative.

Startups are getting into the mix as well. Kaboodle (profile: here and here) gives users the ability to create WishLists and Giftlists. Zoundry offers a toolbar which lets users “share product recommendations… using email or saving the page to a social bookmarking site like del.icio.us or Yahoo! My Web 2.0.” I’d also consider social music recommendation services like Musicmobs to be a social commerce offering.

The above are probably just the tip of the iceburg. I envision a day where you can search your social network to find and see what products others who you know own –and– whether or not they like them. Moreover, you could learn about the people you don’t know when they recommend a product (which you don’t know now on “traditional” shopping engines). With this information, you could make a more informed buying decision about products you are considering – and keep up to date on the ones you don’t yet know you should be buying. This info would more than just allow individuals to keep up with the Joneses… True social commerce would provide consumers with rich social context and relevancy to the purchases which they are making.

David Beisel

David Beisel is a co-founder and Partner at NextView Ventures. He has been focused on early stage Internet startups his entire career, both as an entrepreneur and venture capitalist. As an investor in the digital media space, David was most recently a Vice President at Venrock and previously a Principal at Masthead Venture Partners. Prior to becoming a venture capitalist, David co-founded Sombasa Media, an e-mail marketing company best known for its flagship product BargainDog. Sombasa was successfully acquired by About.com where David served as Vice President of Marketing. David holds an MBA from the Stanford Graduate School of Business and an AB in Economics, magna cum laude and Phi Beta Kappa, from Duke University. He also founded and leads the Boston Innovators Group, an organization which holds quarterly entrepreneur events drawing a thousand attendees.

Leave a Reply