E-Commerce Sites Aren’t Too Social

Written by Evan Schuman
November 2nd, 2007

The influence of social networking sites on E-Commerce has been overblown and such sites have very little influence on purchases, according to a report this week from JupiterResearch.

"There has been a lot of talk about social shopping," said Patti Freeman Evans, the report’s lead analyst, but that talk hasn’t translated into sales. "Social and community sites still rank low in shoppers’ minds as useful places to research and shop for gifts. Only three percent of users who plan to buy online this holiday season—and six percent of those in the segment who are ages 18 to 34—plan to add a wish list or gift list to their MySpace, Facebook, or similar Web site page to help their friends and family select gifts."

Still, reluctance to use a specific shopping service from a social networking site does not necessarily translate into a lack of influence. Evans argues that JupiterResearch’s polling shows that consumers rarely say the social networking sites factor in at all.

This has some fascinating potential ripples throughout E-Commerce. First, let’s assume the numbers are accurate. Having worked with Evans repeatedly over the years, I have found her to consistently be the most informed and intelligent E-Commerce observer today. Survey results are only as good as the analyst interpreting them, so we’re in good hands with Evans. (This has nothing to do with the undeniable fact that anyone with the word "Evan" somewhere in their name usually utters things worth listening to.)

So if we assume Jupiter’s right, we need to think through what this means. The assumption for years has been that as social networks grew, the collective wisdom of the group (the "collective wisdom" of groups of teenagers? There’s a straight line if I ever heard one) would influence huge areas of the members’ lives, from clothing choices to dating advice to the kind of car they should drive.

Therefore, it was assumed that the most powerful social networking sites would strongly drive purchases.

Before we completely abandon those beliefs, consider the possibility that the conventional wisdom may not necessarily contradict Jupiter’s conclusion. Even the best of surveys can’t indicate what influences buying behavior. It merely reveals what consumers say they believe they are influenced by. Are the consumers being truthful? And even if they are being truthful, do they truly know what is influencing them?

Let’s also broaden our practical definition of social networking. On, an incredibly popular feature are consumer-posted product reviews. That is consistently sited as a strong influence on Amazon sales. Wouldn’t that be properly classified as social networking? It’s messages from the collective community.

How much of this is a factor of context? The Jupiter report supports the premise that people today don’t go to those social sites with the objective of doing E-Commerce research.

But what if the next generation of search engines intelligently combed such sites, looking for product discussions and allowed those to appear near those products on Amazon, EBay or, for that matter, You’d then be marrying the social networking site advice with the context of a site designed for E-Commerce.

There’s also the susceptibility aspect of influence. Are consumers saying that they hear all of those product discussions at social networking sites, but either don’t care or do not give it any credibility. Hence, they are literally not influenced by it.

If we look at the other big social E-Commerce trend today—consumer-created videos—we see one common thread: credibility. Or, more precisely, the eternal search for credibility.

The premise is that a large community of consumers will, by and large, give honest, truthful advice and that the community would police itself. In the beginning, though, conartists and salespeople (Is there a difference? Yes. Con artists rarely work on commission.) typically pollute those communications until community policing gets mature enough to work.

Amazon announced this week that it has added videos for more than 450 of its top-selling holiday products. The initial videos look to be commercials—and cheap ones at that—but as the community gets involved, will the credibility improve? And will that boost influence?

That’s the problem with consumers today. Just when e-tailers have them figured out, they go and do something surprising. Like show signs of having a brain stem.


2 Comments | Read E-Commerce Sites Aren’t Too Social

  1. Josh Says:

    I think Jupiter Research, like most other forms of research, is just a few steps behind what’s actually happening. I’m guessing they interviewed people who don’t use social networking sites to see if they used them for making product purchase decisions. Obviously, those people don’t, since social networking is more of a phenomenon for people 25 and under, especially those around 16-21.

    People in that range of 16-21 definitely use social networking more than the average person, plus they put a larger amount of trust into what they are reading. I’m guessing Jupiter didn’t hit any of these people.

    So, basically, in about 5 years, when that demographic moves to having some buying power online, everyone who takes the advice of this jupiter article will again be another 3 steps behind what is actually happening.

  2. Evan Schuman Says:

    RetailWire had an interesting discussion about this story, if you’re interested.


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