Social Commerce- The New and Improved Social Network
This article, although quite biased in its discussion of how social media ought to be used, explains some very interesting points about social commerce. Social commerce is essentially the use of social networks to market and sell products online. According to the article, many people in China use social media to get recommendations and reviews on merchandise, and to obtain advice on investments and purchases. For instance, the Chinese app WeChat is a message board in which users can book hotels and taxis through linked bank accounts while chatting and networking with friends. The article claims that Chinese social media is one step above Western social media because in China, people use thse websites and apps as a means or tool to get somewhere rather than as the goal.
While I do not necessarily agree with this perspective, the assertions in this article can certainly be understood through principles we learned in class. The idea of linking social networking to commerce sites is an excellent business strategy. We can see how effective this system would be by examining it through a graph with two different types of nodes. A company selling a product would be node type A, and the consumer would be node type B. Because all of these e-commerce websites and applications are also social media networks, any time a consumer (node B) purchased a product from (connected to) a seller (node A), all of the other nodes that are linked to node B or node A would be able to see this new connection. As a result, the other node Bs, for instance, would be more inclined to purchase (or not to purchase) something from node A because they have a friend that did so and can receive a recommendation from that friend. In this way, individual businesses that use social commerce can connect to a larger group of consumers with similar interests and tastes. As the article states, the majority of people on social media sites in China are consumers with income to spend. These consumers are friends with other consumers and are likely to pay attention to their friends’ shopping recommendations. Thus, it benefits the company to use social networking as a platform to reach out to consumers. For each person that they successfully make a sale to, that person would have at least a few other friends who would be interested in the same deal. In this way, businesses can use social networks to their advantage because each favorable link that they create will lucratively pave the way for a cluster of other connections.