Over the past couple of months I have had numerous casual conversations with publishing people about Social Commerce and the impact it will have on traditional routes to market. This is a conversation I have also had with several retailers, but there is a unique opportunity for publishing.
Most of the publishing guys felt that Social Commerce will herald an era of true multi-channel publishing analogous with the advent of the Internet for retail (or did once I had described it that way). I found myself taking off my Autharium hat, donning my eGurus hat and holding ad hoc "this is what you should bear in mind when adopting a multi-channel strategy" chats.
The trouble is, very few retailers have got multi-channel completely right and many who are held up as examples of how to do it are actually making a hash of it. When I say "hash", some are doing well but could be doing much better, most are getting squeezed by more agile online pureplays and quite a few are about to hit a cost and inertia brickwall because their eCommerce platform and internal structure will not scale.
It is worth looking at what works from a multi-channel retail perspective when contemplating a move into Social Commerce if you are a publisher.
What is Social Commerce?
Facebook is becoming a new kind of online shopping centre with many retailers setting up Facebook shops and taking sales through Facebook (cunningly referred to as F-Commerce). Google+ is likely to follow with a ready-made payment system in GoogleCheckout. This is just the beginning.
An initial goal is to allow users to build personalised shops based on their Facebook profile. This will present them with products that are specifically targeted to them. This personal shop will consist of multiple retailers, brands and individuals all selling directly via Facebook but appearing in one place.
The opportunity Social Commerce presents to publishers is significant. The ability to sell direct to readers effectively and in a targeted fashion, without the need to build a single retail brand or the paraphernalia that goes with it, will bring a plethora of benefits. This is a channel that is made even more effective with the growth of eBooks, offering instant, direct sales with no stock holding.
The trick is how to make the most of this channel, starting by taking a few pointers from retail. There is no "one-size fits all" approach to this, but there are certain truisms that have become apparent over the last decade or so.
Getting Multi-Channel Right
OK, so a blog posting is not going to be particularly detailed but there are some fundamentals to bear in mind.
Multi-channel is what you are, not what you do.
There are lots of “multi-channel” retailers. However, what the best ones actually do is, online very well, catalogues very well and stores very well. Each channel would be a profitable business by itself and could be run by each channel team independently of the others. Each channel also plays well with the others and as a result you get good multi-channel. Good multi-channel is Gestalt; the whole is greater than the sum of its parts.
A good multi-channel publisher will maintain an excellent traditional retail channel, but will create a market leading Social Commerce channel, allowing each to focus on what they have to do. It will not attempt to “do” multi-channel, this is not how it works. Multi-channel will be a happy by-product of doing both channels well. Actually I have always preferred "cross-channel" to describe this, a subtle but important difference, although it looks like pedantic semantics.
Therefore, there is no such thing as a multi-channel team.
The best companies run each channel with a separate team each having a Director or Head with full decision making capability unfettered by other departments. The only people in a company who can truthfully claim to be running multi-channel are the CEO or MD as they run the whole company. The worst examples of multi-channel I have seen had a pitched battle between several directors all having some aspect of control over online. These were usually the Marketing, Commercial and IT directors. This tended to be the result of an existing department Head being told to “create an eCommerce site pronto” sometime in the early days of dotcom. This creates a combative, restricted and ineffective online channel which never moves as quickly as it needs to. Politics and lack of a clear, single, individual owner kills eCommerce.
Your Director/Head of Social Commerce will need to be a Mini-MD.
Because this channel is, in effect, the equivalent of online for retailers, this person needs to be an all-rounder. They need to understand online marketing, trading, IT, development, operations and customer service. This person needs to be able to make informed decisions in all of these areas and defend their position at the highest levels. Because Social Commerce is about engaging and selling to customers directly, the approach will be similar to an online retailer with a focus on sales and customer support. This team needs to develop a distinct social marketing strategy, be able to create mobile apps, manage operations, deal with customers and be commercially astute. Whilst they’re at it, they might as well run the company website too.
Marketing and/or IT should not own the Social Commerce Channel.
Marketing set the overall company strategy, brand guidelines and framework. IT provides the architecture and infrastructure to support the Social Commerce channel. The Social Commerce team defines the social marketing strategy and the agenda for technical development. This team must control the day-to-day development and trading of their channel. IT and Marketing must never act as a brake on this new channel, it should never be a question of “reining it in” more a case of giving it the tools and support to make things happen.
Related to this, whilst a catalogue business looks similar to an online one at first glance, it is advisable not to let the catalogue business run an online channel, even in the beginning. Though they share content, they work at very different speeds; it gets messy, very messy.
An Interesting Year Ahead
Social Commerce presents an opportunity to publishers to engage more directly with their readers and monetise this relationship. The benefits will be significant, not just through an increased knowledge of reader’s interests but also from increased margins in a channel where retailers are not necessary. The first publisher to “get” this new channel will be onto a winner. It starts now and needs to be addressed pretty sharpish.
Social Commerce, like eCommerce, will be relatively easy to move into. However, it will be hard to master. The experience of retailers over the last ten years is a good source of learning for publishers starting down the "multi-channel" path.
P.S. Of course Social Commerce presents an opportunity for authors to do away with traditional publishing, but that’s another post.