Wednesday, September 14, 2011

The web is dead. Implications for e-commerce.

The low quality of recommendations was one of the problems we looked into during my Summer '11 BUS 74 Principles of Invention class. The class did not select it for the problem-solving session, but I felt the topic was important to the next generation of e-commerce. My intuition was that the traditional web-page + links + search approach was not going to work in the social networking space (the web is a dying media). Here's more evidence for that.

Gallup published a study that, in their opinion, debunks what they call Social Media Myths. One such myth is that consumers can be moved to purchasing decisions by brand-sponsored campaigns.

I can see that young unmarried people, i.e. the most desired target demographic, is mostly influenced by parents, friends, and experts. In the social world it boils down to just friends. Therefore, any effective ad campaign should target "circles", getting one or two members of the circle evaluate the promoted stuff. Having a campaign page or twitter account is a waste of effort.

In contrast, I think a product page [or reference application] on Amazon is a great promotional tool because it captures practically everybody in top influencer categories.  Getting people to cross-post their reviews ("Like", +1, etc) to Facebook or Google+ would be an excellent way to influence purchasing decisions. You may even want to create a dedicated "Shopping" circle so that your friends don't get mad at your spamming. Thinking along similar lines, Google's purchase of Zagat also makes sense.

Conclusion: web page promotions, created either through the traditional web, Facebook, twitter, or Google+ are ineffective. Consumers prefer accounts of immediate experience to product descriptions developed by an interested party.

For the philosophical logic behind this thinking, you can further read Bertrand Russell's The Problems of Philosophy, published in 1912. Chapter 5 talks about the difference between what he calls acquaintance and description.

tags: social, networking, commerce, internet, control, facebook, course, detection

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