Who should I trust? Of social media, e-commerce and people recommendations

Frida Sandin

Who should I trust? Of social media, e-commerce and people recommendations

By Frida Sandin, March 18, 2011

Social media and e-commerce isn’t a new equation, but the two are going through a shift: From integrating social media on e-commerce sites (helping people communicate on site) to integrating the e-commerce experience on social media sites (helping people buy where they connect). Consumers are moving away from the original e-commerce sites, onto other platforms, still eager to spend money though.

This behavioral shift together with the success and expansion of niche e-commerce markets results in many new opportunities for online shops to invent and grow a new generation of business concepts – Facebook stores, Twitter campaigns and so on. Some differ from conventional e-commerce sites and many of them are fundamentally based on the notion of social commerce.

Social commerce itself, however, is not new. Humans have always made decisions based by using social input (recommendations from other people) and then weighing in social capital (should I trust it?).

When we lived an analog life, the tools to get social input were few, but easy to use: If we needed help to make a decision, we asked other people around us. When it came to social capital, the case was more ambiguous. In order to determine which people we could trust, and which people to filter out of the equation, we considered the person who delivered the opinion – e.g. how he/she looked, spoke, even smelled, and whether we seemed to share common values. The human brain is well equipped to do this, but it was not always clear how we reached a decision on who to trust.

In the digital sphere, the potential to collect and structure social input is enormous. One search can bring me thousands or even millions of opinions on any topic. But how do we measure social capital in the best possible way? On the anonymous Internet, who should I trust and why?

There have been some ambitious initiatives to build online reputation systems, e.g. eBay’s seller profiles, but none has been able to become dominant.

In this context it’s interesting to see what Avail is doing with people recommendations. People recommendations, as opposed to product recommendations, help shoppers find “people like you” (i.e., people that have the same consumer behavior and taste as you) and guide them to the decision about which other consumers to trust: Putting the social behavior from the analogue world into a digital context. An obvious application is to use it to filter out ratings & reviews to show only those you might be interested, in travel or retail. There is no reputation system needed – we do the matching for the consumer, much like it was done in the analog era.

How to define and refine the notion of social capital in a digital world is something that we at Avail continuously work on improving. We will soon come back to this subject and share thoughts as well as examples of what the future has in store.

If you are running a social commerce project in your e-commerce store, and would like to understand how people recommendations work, email me at frida.sandin@avail.com.

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    2 Responses to “Who should I trust? Of social media, e-commerce and people recommendations”

    1. May 5th, 2011 at 15:52

      Maia Dematos says:

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    2. May 30th, 2011 at 16:02

      Why brand managers can exhale and e-commerce managers need to inhale says:

      [...] same way online as offline: No matter how good answers or insights you’re giving your customers, they will never trust you more than their peers. The market economy is forcing all of us to compete on new terms and no brand can consider [...]

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