It seems that just about every article published by a social commerce expert these days reminds merchants of the fragility of social connections. They consistently point out that the type of behaviour that needs to be encouraged is the positive dialogue about a particular product or offer – and not necessarily the purchase itself.
Yet, even as social commerce begins to turn a corner, many platforms still want to control the dialogue of their users. Merchants want to be sure that people are not being negative about products they don’t like but talking about and sharing the ones they do. This can be a difficult behaviour to encourage, especially without making the user feel “forced” to do or say something specific. However, numerous examples from across the web demonstrate that the right incentives produce the right social behaviours.
Groupon, for example, was able to benefit from a natural incentive for people to share deals with their friends, as many of their offers make for a great social experience. In fact, on Groupon’s “How it Works” page, step 2 of the 3-step Groupon process requires users to share deals with others. Although users are unlikely to email their friends with deals they’re uninterested in. In addition, users can earn Groupon credit or “Groupon Bucks” for every friend they invite to the community that makes a purchase. Therefore, the social model naturally encourages people to promote what they liked and get their friends to join.
Another site that has integrated a similar cash reward-based invite system is daily design sensation Fab.com. The site, which launched in June 2011, now counts over 3 million members that regularly share products they like (and even the ones they buy!) in order to earn discounts and rewards. As over one third of the people who have joined the platform to date have been referred via a friend, it’s clear that its cash incentive may play a very strong role in encouraging users to share. Users can earn $30 credit for the first 10 people they invite that join the platform – and there are additional rewards to keep the user inviting and encouraging their friends to join and buy.
Fab.com also offers cash credit and rewards for other types of social behaviour – such as a user revealing their identity publicly when they purchase a product. This means that users are rewarded for displaying the products they like and want to buy to their Fab community, essentially endorsing the product to their social circle.
Similar to Fab.com, Shopcade integrates similar elements of “social-proof” and cash rewards. Essentially, users share products they love and discover real-time, personalised trends based on their friends’ recommendations and their own interests. It’s essentially like having a digital storefront with all the products you love in one place – though you do not necessarily have to own or buy them. Then, users can earn cash whenever someone purchases a product they feature in their Shopcade. Therefore, while there is currently no cash or rewards-based invite scheme, users can financially profit from sharing products they love à la Fab.com. As a result, users only share the products they love the most and the products they actually think that others will buy.
There are other examples of social commerce companies using a similar credit-style incentive scheme to encourage social behaviour. However, rather than offering users credit to use exclusively on Groupon or Fab.com offers, Shopcade users can earn commission, or cash back. In addition, there’s also the possibility for users to donate their cash rewards to charity, which is an option that approximately 25% of users opt for.
Though it seems to resonate well with users, offering money and credit are not the only ways to encourage positive behaviours on these types of platforms. As we have seen with companies like Zynga and Foursquare, some users can also be encouraged by badges, points and virtual goods – essentially anything that can increase their virtual social status or allow them to personalise their profile or avatar.
All in all, as social commerce continues to develop, it’s clear that we’ll continue to see different types of incentive schemes to encourage specific user behaviours. However, for now, the majority of commercial platforms seem to be going in the direction of monetary rewards – from driving invitations to purchases to sharing deals and offers.
