Social commerce has introduced a practice of discontinuous change to retail that will drive the market going forward in a manner that will not allow retailers to rest and will also require a discontinuous level of investment that will be the only thing that remains constant. In this social commerce model there is no end state there is only a continuous journey with changes and turns that individually are extremely difficult, if not impossible, to predict. This model is a dramatic change for large legacy retailers that have developed a model that takes advantage of size and bulk to drive profits, this model is being turned on its head by the leveling effect of social commerce that focuses on the consumer demands.
The social commerce impact is reverberating across the market and impacting all areas and partner in the market and one major change in this new landscape is that consumer driven demand and purchasing is no longer driven by the offerings of the large legacy retailers. It seems that these practices of the large retailers is relegating their market share to commodity type purchases that are based on price and product availability. This is a very difficult situation to find yourself in because it is so difficult to extract yourself once it becomes the consumer's’ view of your place in the market. On the positive side though, retailers such as Amazon are turning many purchases into commodity type purchases.
In my opinion, Amazon is probably the best example of a retailer that embraces and also is driving social commerce. I think that Amazon is in fact the one retailer that is focused on building the components now that will make up the framework of the social commerce market. Amazon has made developed a steady progression of tools and shopping capabilities while at the same time maintaining a focus on consumer social integration that has lead the market in developing and growing social commerce. Amazon understands that consumers are changing their shopping and purchasing practices and Amazon is continuously experimenting with new tools and capabilities to engage the consumer and encourage active participation by the consumer.
Amazon is leading the way and now and legacy retailers need to develop their own strategy to engage with consumers, they should not focus on copying Amazon tactics, instead they should be developing tools and capabilities that engage their own customers. Legacy retailers have a great advantage in the span of their consumer interactive options and also their reputation with the consumers. These retailers are wasting their time in chasing Amazon because they will never win, instead these retailers need to focus on developing their consumer relationships that take advantage of their own strengths.
And now for the audience participation portion of the show…
ECommerce will have wide ranging impacts on both the retail and manufacturing sectors. How can you focus these abilities to improve the consumer's experience? Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes. In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas. How can you support these continuously changing requirements?