Chapter 2 Tools and Platforms for Social Commerce

Learning Objectives 1.Describe the major basics of social media. 2.Describe Web 2.0 and its major characteristics. 3.List the major social media tools and their uses in SC. 4.Describe social networks. 5.Describe mobile social commerce. 6.Understand the essentials of crowdsourcing. 7.Describe virtual worlds.

Opening Case: Pinterest: An Innovative Social Commerce Platform The Opportunity – Pinterest’s roots relate to social bookmarking images – Pinterest succeeded in attracting initial venture capital to expand the business

Opening Case: Pinterest: An Innovative Social Commerce Platform The Solution – Pinterest a provider of virtual pinboards that allow users to organize and share images found on the Web organized by topics – The company’s goal is to connect people according to common interests and do it while making profit – Viable business and revenue models are needed

Opening Case: Pinterest: An Innovative Social Commerce Platform The Business and Revenue Models – Pinterest revenue model is based on charging for advertising – Pinterest has begun adding “do it yourself” advertising to Promoted Pins, which will be available on a cost-per-click basis – Pinterest is also adding updated analytics

Opening Case: Pinterest: An Innovative Social Commerce Platform Yang’s Suggestions – Charging advertisers – Charging e-commerce partners – Charging users – Charging B2B partners Selling Data for Market Research and Analysis

Opening Case: Pinterest: An Innovative Social Commerce Platform Selling Data for Market Research and Analysis – Customer data may reveal important statistical associations and relationships between consumer behavior, content and services and products provided – Pinning and repinning on Pinterest, consumers show their affinity for certain themes or for specific products

Opening Case: Pinterest: An Innovative Social Commerce Platform Other Suggestions for Doing Business on Pinterest Using Pinterest for Advertising, Marketing, and Other Business Activities

Opening Case: Pinterest: An Innovative Social Commerce Platform Results and Managerial Issues – As of Q3 2013, Pinterest was the fastest growing content-sharing platform – As of July 2013, the total number of users worldwide is 70 million – In October 2014, the valuation of Pinterest was about $5 billion – The company plans to have an IPO in 2015

Opening Case Pinterest: An Innovative Social Commerce Platform Legal Concerns – Many people collect images from the Internet to build their pinboards without asking permission from the content creators, giving them an attribute, or compensating them – Some of the collected material is formally copyrighted; other material may be considered copyrighted – According to Pinterest’s 'Terms of Service,’ members are “solely responsible for” the content they post on Pinterest and users must have explicit permission from the owners of the content to post them

Opening Case: Pinterest: An Innovative Social Commerce Platform Pinterest's Competition – Competitors are emerging in niche markets TripAdvisor (travel) Gentlemint.com (cars, world news, fitness) Dribbble.com (designers to share their creations) Conclusion – Pinterest has some potential benefits for small businesses – The success of Pinterest will be determined by its revenue model and the company's profitability

Lessons Learned from this Case Pinterest is a unique platform for conducting social media and e-commerce activities Companies can build pinboards that promote their brands Pinterest can be used as a platform for facilitating innovations via idea-generation and sharing Pinterest is a derivative of Web 2.0 and social media, it is a new mechanism for supporting social commerce

Social Media: The Basics Social Media: Many Definitions – Is a blend of technology, content, and social interactions for the co-creation of value – Video: “Social Media 2013” at youtube.com/watch?v=QUCfFcchw1w youtube.com/watch?v=QUCfFcchw1w The Landscape of Social Media – 3 major types of entities Application tools for media components for applications Delivery platforms, mainly social network sites and services Social media activities such as conversations, sharing, and recommendations

Figure 2.1 The Components of Social Media

Social Media: The Basics – The Major Parts of Social Media 1.Media components and applications 2.Social network sites and services 3.Social media activities Functional Building Blogs – Sharing – Presence – Conversations – Relationships – Reputation – Identity – Groups

Social Media: The Basics – Social Media Marketing (SMM)* – Web 2.0 Tools and Applications Software Applications (Apps)*

Web 2.0 and Its Major Characteristics Representative Characteristics of Web 2.0 User-Generated content (UGC)*

The Major Social Media Tools: From Blogs and Microblogs to Wikis and Support Technologies Social software* Blog (Web Log)* Video Blog (vlog)* – Building Effective Blogs – Commercial Uses of Blogs

The Major Social Media Tools: From Blogs and Microblogs to Wikis and Support Technologies Microblogging and Twitter – Microblogging* – Twitter* – Tweets* Wikis* – Business Applications of Wikis

The Major Social Media Tools: From Blogs and Microblogs to Wikis and Support Technologies Other Useful Tools and Apps – Social Search Specialized Search Engines for Social Networks – Using Multiple Tools to Improve Performance

Social Networks and Social Networking Sites and Services Social network* Social network services (SNSs)* – Social Networking* – The Social Networking Landscape – A Global Phenomenon

Social Networks and Social Networking Sites and Services The Major Capabilities and Services Provided by Social Network Sites Business-oriented social networks* – Example of a Business-Oriented Social Network: XING Enterprise Social Networks

Mobile Social Commerce Mobile social networking* – Video Sharing – Example of Social Mobile Commerce Applications IBM Mobile Connect – Mobile Community Activities

Crowdsourcing and Crowdfunding: An Introduction Crowdsourcing* – The Process of Crowdsourcing – Benefits of Crowdsourcing – Uses of Crowdsourcing in Social Commerce – Video: “Jeff Howe - Crowdsourcing” at youtube.com/watch?v=F0-UtNg3ots youtube.com/watch?v=F0-UtNg3ots Crowdfunding*

Figure 2.2 The Basic Elements Of Crowdsourcing

Figure 2.3 A Typical Crowdsourcing Process

Virtual Worlds as a Social Commerce Platform Virtual world* Major Features – The worlds can be used by many users who access them via online interface. – The interface is mostly 3D, which is more engaging than 2D. – All interactions are in real time from anywhere Avatars* – Virtual Shopping