Every week, I enjoy reading BusinessWeek and one of the highlights is James (Jim) Cooper’s weekly article on the economy. When I initially started to read Jim’s article, many years ago, I had to struggle through it. Even though I earned my MBA from Wharton, some of the concepts were difficult to understand and my “pattern recognition” took awhile to form. I’m glad I stuck with it, as it has helped me understand business trends more quickly.
I’ve been thinking a lot about the consumer in this economy, given that consumers drive about 70% of our economy in the U.S. and a large share of the world’s economy (most notably China’s). We are the world’s largest shopper. This week’s article by Mr. Cooper really hit the nail on the head, leading me to believe that the recovery is going to take a lot longer than initially assumed. This may be old news to some of you, but I have been consuming the data as it becomes available and seeing consumer saving increase so dramatically is a real turning point.
I believe that social commerce will shine in a gloomy time like this. Consumers have always feared “buyer’s remorse“. With U.S. unemployment at 7.6% and rising, in addition to the multi-trillion dollar decrease in consumer wealth, purchases will be scrutinized like never before. And I believe customer ratings and reviews, as well as all forms of customer-generated content (and word of mouth), will be leveraged like never before. From reducing returns to increasing sales, it is clear that social commerce reduces buyer’s remorse. This isn’t just a U.S. trend, as the economic problems are global and buyer’s remorse is a common human behavior, and I believe this is the driver behind Sam’s recent post on UK consumers flocking to social commerce.
If you missed Sam’s post in November on Amazon, I recommend you read it. They were one of the few retailers online that recently announced stellar results during such a challenging retail season.
Our clients have been stepping up their pace of innovation with social commerce. You can see it reflected in our many blog posts in the last two months, especially the one from Heather about the unprecented number of holiday promotions we helped drive with our Community Managers.
This will be a huge year for social commerce. Our company is signing clients at a faster pace than ever before. Innovation is accelerating rapidly, and not just online. The ROI is very proven. And I’m proud of the way we are helping our clients in such a challenging time.
Come join us from April 27-29th in Austin at our Social Commerce Summit to discuss how the best are leveraging social commerce. We sincerely look forward to seeing you there.