Social Commerce - New Revenue Models
Even as social networking evolves, a subset is already being spawned called Social Commerce. These sites are really not technically different from Social Networking sites, except that they revolve around Commerce in some fashion. The essence of a social commerce site is a place where people gather to get product and service advice from trusted peers, to aid in a purchasing decision - or more simply put, product/service recommendation services. The site most often referred to when talking about social commerce is Yahoo's Shoposphere.
However, there are other sites that are making use of social commerce that may not seem quite as obvious. Squidoo.com, for example, allows you to set up your own "lens" (niche topic), which you can customize with various modules. Many of those modules are commerce based. Essentially, mixed in with your "expert" content, you can recommend certain products. You can link to your own products, of course, which adds yet more possibility of visitors and sales. You can also include modules (such as Amazon, for example), enabling you to reap a percentage of the profit from the sale of those products. Either way, you are using your recommendations to either earn a profit on an affiliate-type basis, or by subtly directing users to your own products on your site.
Other Web 2.0 companies are starting to think about different ways of monetization as well. For example, coinlogic.com (which is still merely a thought in someone's head), promises to enable microcommerce - essentially abandoning the advertising and shopping cart models currently in vogue. I'm not sure exactly how this will fit into social commerce, but I can imagine how it might be used - if not by coinlogic, then by someone else. It wasn't that long ago that people couldn't imagine paying 99 cents for a song online, but now it's a mega-business.? What if you could monetize your content easily with tiny payments, without having to program it yourself? And what if users encouraged other users to purchase your content with micropayments?
The point? Social networking, and its subset of social commerce, is enabling users to collaborate and convince users to purchase products or services. Using the same strategies as the social networking sites, your voice can be heard, and your recommendations can lead to purchases of your products or services.
Tomorrow...Part Four