The New E-commerce: Social, Mobile, Local

One of the biggest changes is the extent to which e-commerce has become more social, mobile, and local. Online marketing once consisted largely of creating a corporate website, buying display ads on Yahoo, purchasing search-related ads on Google, and sending email messages. The workhorse of online market­ing was the display ad. It still is, but it’s increasingly being replaced by video ads, which are far more effective. Display ads from the very beginning of the Internet were based on television ads, where brand messages were flashed be­fore millions of users who were not expected to respond immediately, ask ques­tions, or make observations. If the ads did not work, the solution was often to repeat the ad. The primary measure of success was how many eyeballs (unique visitors) a website produced and how many impressions a marketing campaign generated. (An impression was one ad shown to one person.) Both of these measures were carryovers from the world of television, which measures mar­keting in terms of audience size and ad views.

1. From Eyeballs to Conversations: Conversational Commerce

After 2007, all this changed with the rapid growth of Facebook and other social sites, the explosive growth of smartphones beginning with the Apple iPhone, and the growing interest in local marketing. What’s different about the new world of social-mobile-local e-commerce is the dual and related concepts of conversations and engagement. In the popular literature, this is often referred to as conversational commerce. Marketing in this new period is based on firms engaging in multiple online conversations with their customers, potential cus­tomers, and even critics. Your brand is being talked about on the web and social media (that’s the conversation part), and marketing your firm, building, and restoring your brands require you to locate, identify, and participate in these conversations. Social marketing means all things social: listening, discussing, interacting, empathizing, and engaging. The emphasis in online marketing has shifted from a focus on eyeballs to a focus on participating in customer-oriented conversations. In this sense, social marketing is not simply a new ad channel but a collection of technology-based tools for communicating with shoppers. The leading social commerce platforms are Facebook, Instagram, Twitter, and Pinterest.

In the past, firms could tightly control their brand messaging and lead con­sumers down a funnel of cues that ended in a purchase. That is not true of social marketing. Consumer purchase decisions are increasingly driven by the conversations, choices, tastes, and opinions of their social network. Social mar­keting is all about firms participating in and shaping this social process.

2. From the Desktop to the Smartphone

Traditional online marketing (browser-based, search, display ads, video ads, email, and games) still constitutes the majority (58 percent) of all online mar­keting ($107 billion), but it’s growing much more slowly than social-mobile-local marketing. Mobile marketing now constitutes 70 percent of all online market­ing. The marketing dollars are following customers and shoppers from the PC to mobile devices (eMarketer, 2018g)

Social, mobile, and local e-commerce are connected. As mobile devices be­come more powerful, they are more useful for accessing Facebook and other social sites. As mobile devices become more widely adopted, customers can use them to find local merchants, and merchants can use them to alert customers in their neighborhood of special offers.

Source: Laudon Kenneth C., Laudon Jane Price (2020), Management Information Systems: Managing the Digital Firm, Pearson; 16th edition.

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