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Integrated Solutions. Measurable Results.


                                                                                                             August 2011

                360i Point of View on
                Mobile Social Commerce
1B0BOverview
This is the sixth installment in 360i’s Social Commerce Series. Visit 360i.com/insights to read the
agency’s prior reports on Facebook Commerce, Social Shopping, Social Commerce for CPGs, Daily Deals
and Ratings & Reviews.

Even though social commerce is still so new that it’s taking its first wobbly steps, it’s easy to see that in
the coming years, much of it will transpire through mobile devices. While mobile social commerce is
difficult to quantify, consider a few of these trends:

   ?   Worldwide e-commerce sales via mobile
       devices are projected to reach $119 billion in
       2015, up from $1.2 billion in 2009 (source:
       Microsoft’s Mobile E-Commerce Infographic)
   ?   50 percent of Groupon’s business is expected
       to come via mobile in the next two years
       (source: Microsoft)
   ?   Facebook has more than 250 million active
       users for its mobile properties (source:
       Facebook)
   ?   ScanLife processes one barcode scan per
       second just through its mobile apps (source:
       ScanLife)                                                                     Via HMicrosoft

Much of media consumption is shifting to mobile devices, social media is one of the top activities on
mobile devices, and mobile commerce in the coming years will quickly jump from a negligible number to
a significant revenue stream for marketers in the U.S. and worldwide. This report reviews how all of
these trends are coming together and creating new opportunities for marketers.

 Where mobile social commerce fits in a marketing plan
 Dentsu developed a five-step model to illustrate consumer behavior. Dubbed “AISAS,” it starts with
 the passive stages of Attention and Interest and then – if the marketer is successful – progresses into
 the active stages of Search (searching for more information), Action (making a purchase or some
 other form of conversion) and Share (using social media to spread the word). The final stage of
 sharing can then trigger the cycle to start anew for other consumers.




            NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                              ?2011 360i LLC. All Rights Reserved
Integrated Solutions. Measurable Results.


                                                                                                           August 2011

              360i Point of View on
              Mobile Social Commerce
With mobile social commerce, much of the activity right now is focused on attracting consumers’
attention and engaging them to drive more interest. Today, more of the searching and actions occur
both offline and through the web, and when it’s done through mobile devices, there’s little that’s social
about it.

With mobile social commerce, marketers have the opportunity to encourage consumers to share
experiences with their friends even before they’ve made a purchase. Additionally, once consumers
make a transaction, marketers can leverage mobile devices to allow consumers to instantly share their
purchases with their broader social networks.



Mobile social commerce applications
There are many kinds of mobile social commerce applications, especially when taking a broad view of
social commerce as we have in this POV series. Below are some of the more prominent or interesting
applications in various categories.

Social integration
Marketers can incorporate social services, such as Facebook,
Twitter and Tumblr, into their own apps to speed up
registration, allow shoppers to provide feedback about
products and also share products via social networks, blogs,
and other means. As an example, Steve Madden incorporated
Facebook ‘likes’ into its mobile product pages (see image at
right) and made it easy for shoppers to share shoes through
the social network. Mobile Marketer reported that adding the
feature increased the mobile site’s traffic by 30 percent within
24 hours.

Check-ins
Apps like Foursquare can lure consumers to local businesses via friends’ recommendations and
merchants’ deals. The field has narrowed here, with Foursquare reaching the 10 million user milestone
and Facebook’s mobile usage continuing to accelerate; few others offer enough scale to entice
marketers to participate, though there are opportunities to experiment with niche apps. Other apps
encourage engagement at physical locations, such as SCVNGR, which is focused on rewarding users
for completing challenges rather than check-in activity.

Reviews
As discussed in our POV on Ratings & Reviews, reviews are part of the backbone of social media and
remain one of the most proven ways to influence purchase decisions. There are countless mobile apps
and sites where people can peruse and add reviews, from veterans such as Yelp and Citysearch to
newer entrants like SpotOn and Bizzy. Retailers that incorporate reviews into their websites also
generally do so through their mobile sites and applications.

Group Buying and Daily Deals
As reported in our POV on this subject, Groupon, LivingSocial, Scoutmob, Yipit and other deal sites

          NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                            ?2011 360i LLC. All Rights Reserved
Integrated Solutions. Measurable Results.


                                                                                                           August 2011

              360i Point of View on
              Mobile Social Commerce
and aggregators share offers through their mobile apps. For brands with mobile apps or robust mobile
sites, it’s possible to offer such deals directly.

Q&A
Local question and answer services allow users to get instant feedback
from experts nearby or in a given location. ChaCha (see image at right),
typically accessed by sending text messages to CHACHA (242242), reports
answering over 1 billion questions, though those questions aren’t just
locally-oriented. Startup Localmind specifically directs questions to local
experts who have checked in at various locations.

Style Feedback
Go Try It On, Fashism and TriMirror are among an emerging class of
applications that allow people to take photos of themselves trying on
apparel and accessories, upload those photos and then get feedback from
friends and others who can vote via mobile devices or the web. They
typically target teenage girls and young women who use the app to seek
advice, show off or both.

Shopping Feedback
While apps mentioned above could be used just as easily in a retailer’s dressing room as they can
while rifling through one’s closet, certain apps allow people to solicit feedback from friends while
making purchasing decisions. For instance, MyShopanion is a barcode scanner that lets users ask
friends’ opinions on any items scanned. Another, Scandit, also lets users share any products scanned
through social media channels.

Collecting
Pinterest has made “pinning” one of the hotter crazes online as people share images of what they
love, from design to clothing to food to books. The mobile app allows users to take photos for their
“pinboards” while browsing and sharing the latest images from boards they follow. Pose is mobile app
with similar functionality to the photo-sharing from Pinterest. Want! takes a similar approach to photo
sharing, with a focus more on what you want rather than what you love.




          NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                            ?2011 360i LLC. All Rights Reserved
Integrated Solutions. Measurable Results.


                                                                                                           August 2011

              360i Point of View on
              Mobile Social Commerce
Case Study: Amex enables social offers for merchants
In a deal that is bound to increase the number of businesses running mobile social programs,
American Express launched a program allowing its merchants to create Facebook and Foursquare
deals through a centralized dashboard. Merchants can offer deals for Amex cardholders, and deals are
redeemed automatically through the card, rather than requiring coupons or offer codes.

There will be hurdles here. Most notably, cardholders must proactively link their Amex credit cards
with their social media accounts. Additionally, merchants run the risk of alienating shoppers by
showing favoritism toward one payment method over another. Even with such challenges, Amex aims
to stand out by providing value to its customers, who can in turn use mobile social channels to attract
more consumers.




                                             Images via Fast Company




          NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                            ?2011 360i LLC. All Rights Reserved
Integrated Solutions. Measurable Results.


                                                                                                           August 2011

              360i Point of View on
              Mobile Social Commerce
Using the strategic lens to evaluate opportunities
When considering any of the manifold opportunities that mobile social commerce presents, it’s helpful
to return to the 360i Strategic Lens, which presents four questions marketers must answer thoroughly
to set themselves up for success while minimizing potential mishaps.

Here are the questions and how they apply to mobile social commerce:

1) Does it meet our marketing objectives?
Are you seeking engagement between your customers and your products? Are you trying to directly
impact sales? Do you want to empower your customers to become advocates for your products and
brands? All of these are possible with mobile social commerce, and the specific goal can help
determine which avenues make sense while ruling out
others.

2) Does it leverage our arsenal?
First, consider your mobile arsenal – your mobile sites,
applications, ads, sponsorships and partnerships. Factor
in your products themselves, retail locations or other
physical touch points, and staff at such locations. You
should also factor in your online and offline owned,
earned, and paid media to promote the mobile program.

3) Does it follow the rules of the road?
It’s important to understand how your target audience is
using mobile media, and specifically how they’re using
any of the properties that may be part of such a
program. In some cases, communication will be
paramount while in others, social media will merely
support a largely transactional experience.

4) What’s the value exchange between the brand
and consumer?
The value proposition for consumers can include deals, information such as ratings and
recommendations to help inform a shopping decision, recognition for contributions the consumer
makes, social currency when the consumer gets to share content and offers with friends, a feeling of
altruism when consumers aid others with their own decisions and entertaining content that may keep
consumers engaged.



Conclusion/Marketer Implications/Action Items

Mobile social commerce is just starting to find its footing. The number of mobile users has reached
critical mass by any definition. Social media is one of the most popular activities for people on mobile
devices and the majority of mobile users are tapping their handsets to help them shop in various


          NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                            ?2011 360i LLC. All Rights Reserved
Integrated Solutions. Measurable Results.


                                                                                                               August 2011

                 360i Point of View on
                 Mobile Social Commerce
 ways.

 The focus for most marketers now tends to be on tying together two of the three elements of mobile
 social commerce. As discussed throughout this series, social commerce in general is just starting to
 emerge as a viable way to deliver on marketers’ objectives. Meanwhile, marketers are dabbling in
 various forms of mobile social media, though usually on an experimental basis. It’s telling that the
 biggest social media platforms, such as Facebook, Twitter and YouTube, don’t have significant,
 scalable mobile offerings for marketers, though that should change in 2012. Finally, marketers that
 sell products directly online still tend to be in catch-up mode in creating robust, user friendly sites and
 applications optimized for mobile devices.

 Tying together all three pieces is especially challenging, but some aspects described here are already
 mainstream, and others are quickly finding audiences. Even emerging areas like Style Feedback and
 Collecting can attract some of the most vocal, passionate, and influential consumers, so applications
 of mobile social commerce can reel in a valuable group of users that will spread the word to others.
 Marketers should look for suitable ways to tie together mobile sharing and shopping. These shifts in
 consumer behavior will increasingly have an impact on how people make transactions and engage in
 the word-of-mouth activities that influence purchasing decisions.


Next Steps
Contact your 360i strategic advisor to explore how mobile social commerce can be used to further your
marketing objectives.


 About 360i
 360i is an award-winning digital marketing agency that drives results for Fortune 500 marketers through insights, ideas
 and technologies. 360i helps its clients think differently about their online presence and evolve their strategies to take
 advantage of the new world of marketing communications – one where brands and consumers engage in interactive
 and multi-directional conversations. In 2010, Ad Age named 360i to its prestigious Agency A-List. Current clients
 include Kraft Foods, JCPenney, Coca-Cola, NBC Universal and H&R Block, among others. For more information, please
 visit blog.360i.com or follow us on Twitter @360i.




             NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630

                                                ?2011 360i LLC. All Rights Reserved

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360i Report on Mobile Social Commerce

  • 1. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce 1B0BOverview This is the sixth installment in 360i’s Social Commerce Series. Visit 360i.com/insights to read the agency’s prior reports on Facebook Commerce, Social Shopping, Social Commerce for CPGs, Daily Deals and Ratings & Reviews. Even though social commerce is still so new that it’s taking its first wobbly steps, it’s easy to see that in the coming years, much of it will transpire through mobile devices. While mobile social commerce is difficult to quantify, consider a few of these trends: ? Worldwide e-commerce sales via mobile devices are projected to reach $119 billion in 2015, up from $1.2 billion in 2009 (source: Microsoft’s Mobile E-Commerce Infographic) ? 50 percent of Groupon’s business is expected to come via mobile in the next two years (source: Microsoft) ? Facebook has more than 250 million active users for its mobile properties (source: Facebook) ? ScanLife processes one barcode scan per second just through its mobile apps (source: ScanLife) Via HMicrosoft Much of media consumption is shifting to mobile devices, social media is one of the top activities on mobile devices, and mobile commerce in the coming years will quickly jump from a negligible number to a significant revenue stream for marketers in the U.S. and worldwide. This report reviews how all of these trends are coming together and creating new opportunities for marketers. Where mobile social commerce fits in a marketing plan Dentsu developed a five-step model to illustrate consumer behavior. Dubbed “AISAS,” it starts with the passive stages of Attention and Interest and then – if the marketer is successful – progresses into the active stages of Search (searching for more information), Action (making a purchase or some other form of conversion) and Share (using social media to spread the word). The final stage of sharing can then trigger the cycle to start anew for other consumers. NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
  • 2. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce With mobile social commerce, much of the activity right now is focused on attracting consumers’ attention and engaging them to drive more interest. Today, more of the searching and actions occur both offline and through the web, and when it’s done through mobile devices, there’s little that’s social about it. With mobile social commerce, marketers have the opportunity to encourage consumers to share experiences with their friends even before they’ve made a purchase. Additionally, once consumers make a transaction, marketers can leverage mobile devices to allow consumers to instantly share their purchases with their broader social networks. Mobile social commerce applications There are many kinds of mobile social commerce applications, especially when taking a broad view of social commerce as we have in this POV series. Below are some of the more prominent or interesting applications in various categories. Social integration Marketers can incorporate social services, such as Facebook, Twitter and Tumblr, into their own apps to speed up registration, allow shoppers to provide feedback about products and also share products via social networks, blogs, and other means. As an example, Steve Madden incorporated Facebook ‘likes’ into its mobile product pages (see image at right) and made it easy for shoppers to share shoes through the social network. Mobile Marketer reported that adding the feature increased the mobile site’s traffic by 30 percent within 24 hours. Check-ins Apps like Foursquare can lure consumers to local businesses via friends’ recommendations and merchants’ deals. The field has narrowed here, with Foursquare reaching the 10 million user milestone and Facebook’s mobile usage continuing to accelerate; few others offer enough scale to entice marketers to participate, though there are opportunities to experiment with niche apps. Other apps encourage engagement at physical locations, such as SCVNGR, which is focused on rewarding users for completing challenges rather than check-in activity. Reviews As discussed in our POV on Ratings & Reviews, reviews are part of the backbone of social media and remain one of the most proven ways to influence purchase decisions. There are countless mobile apps and sites where people can peruse and add reviews, from veterans such as Yelp and Citysearch to newer entrants like SpotOn and Bizzy. Retailers that incorporate reviews into their websites also generally do so through their mobile sites and applications. Group Buying and Daily Deals As reported in our POV on this subject, Groupon, LivingSocial, Scoutmob, Yipit and other deal sites NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
  • 3. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce and aggregators share offers through their mobile apps. For brands with mobile apps or robust mobile sites, it’s possible to offer such deals directly. Q&A Local question and answer services allow users to get instant feedback from experts nearby or in a given location. ChaCha (see image at right), typically accessed by sending text messages to CHACHA (242242), reports answering over 1 billion questions, though those questions aren’t just locally-oriented. Startup Localmind specifically directs questions to local experts who have checked in at various locations. Style Feedback Go Try It On, Fashism and TriMirror are among an emerging class of applications that allow people to take photos of themselves trying on apparel and accessories, upload those photos and then get feedback from friends and others who can vote via mobile devices or the web. They typically target teenage girls and young women who use the app to seek advice, show off or both. Shopping Feedback While apps mentioned above could be used just as easily in a retailer’s dressing room as they can while rifling through one’s closet, certain apps allow people to solicit feedback from friends while making purchasing decisions. For instance, MyShopanion is a barcode scanner that lets users ask friends’ opinions on any items scanned. Another, Scandit, also lets users share any products scanned through social media channels. Collecting Pinterest has made “pinning” one of the hotter crazes online as people share images of what they love, from design to clothing to food to books. The mobile app allows users to take photos for their “pinboards” while browsing and sharing the latest images from boards they follow. Pose is mobile app with similar functionality to the photo-sharing from Pinterest. Want! takes a similar approach to photo sharing, with a focus more on what you want rather than what you love. NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
  • 4. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce Case Study: Amex enables social offers for merchants In a deal that is bound to increase the number of businesses running mobile social programs, American Express launched a program allowing its merchants to create Facebook and Foursquare deals through a centralized dashboard. Merchants can offer deals for Amex cardholders, and deals are redeemed automatically through the card, rather than requiring coupons or offer codes. There will be hurdles here. Most notably, cardholders must proactively link their Amex credit cards with their social media accounts. Additionally, merchants run the risk of alienating shoppers by showing favoritism toward one payment method over another. Even with such challenges, Amex aims to stand out by providing value to its customers, who can in turn use mobile social channels to attract more consumers. Images via Fast Company NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
  • 5. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce Using the strategic lens to evaluate opportunities When considering any of the manifold opportunities that mobile social commerce presents, it’s helpful to return to the 360i Strategic Lens, which presents four questions marketers must answer thoroughly to set themselves up for success while minimizing potential mishaps. Here are the questions and how they apply to mobile social commerce: 1) Does it meet our marketing objectives? Are you seeking engagement between your customers and your products? Are you trying to directly impact sales? Do you want to empower your customers to become advocates for your products and brands? All of these are possible with mobile social commerce, and the specific goal can help determine which avenues make sense while ruling out others. 2) Does it leverage our arsenal? First, consider your mobile arsenal – your mobile sites, applications, ads, sponsorships and partnerships. Factor in your products themselves, retail locations or other physical touch points, and staff at such locations. You should also factor in your online and offline owned, earned, and paid media to promote the mobile program. 3) Does it follow the rules of the road? It’s important to understand how your target audience is using mobile media, and specifically how they’re using any of the properties that may be part of such a program. In some cases, communication will be paramount while in others, social media will merely support a largely transactional experience. 4) What’s the value exchange between the brand and consumer? The value proposition for consumers can include deals, information such as ratings and recommendations to help inform a shopping decision, recognition for contributions the consumer makes, social currency when the consumer gets to share content and offers with friends, a feeling of altruism when consumers aid others with their own decisions and entertaining content that may keep consumers engaged. Conclusion/Marketer Implications/Action Items Mobile social commerce is just starting to find its footing. The number of mobile users has reached critical mass by any definition. Social media is one of the most popular activities for people on mobile devices and the majority of mobile users are tapping their handsets to help them shop in various NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
  • 6. Integrated Solutions. Measurable Results. August 2011 360i Point of View on Mobile Social Commerce ways. The focus for most marketers now tends to be on tying together two of the three elements of mobile social commerce. As discussed throughout this series, social commerce in general is just starting to emerge as a viable way to deliver on marketers’ objectives. Meanwhile, marketers are dabbling in various forms of mobile social media, though usually on an experimental basis. It’s telling that the biggest social media platforms, such as Facebook, Twitter and YouTube, don’t have significant, scalable mobile offerings for marketers, though that should change in 2012. Finally, marketers that sell products directly online still tend to be in catch-up mode in creating robust, user friendly sites and applications optimized for mobile devices. Tying together all three pieces is especially challenging, but some aspects described here are already mainstream, and others are quickly finding audiences. Even emerging areas like Style Feedback and Collecting can attract some of the most vocal, passionate, and influential consumers, so applications of mobile social commerce can reel in a valuable group of users that will spread the word to others. Marketers should look for suitable ways to tie together mobile sharing and shopping. These shifts in consumer behavior will increasingly have an impact on how people make transactions and engage in the word-of-mouth activities that influence purchasing decisions. Next Steps Contact your 360i strategic advisor to explore how mobile social commerce can be used to further your marketing objectives. About 360i 360i is an award-winning digital marketing agency that drives results for Fortune 500 marketers through insights, ideas and technologies. 360i helps its clients think differently about their online presence and evolve their strategies to take advantage of the new world of marketing communications – one where brands and consumers engage in interactive and multi-directional conversations. In 2010, Ad Age named 360i to its prestigious Agency A-List. Current clients include Kraft Foods, JCPenney, Coca-Cola, NBC Universal and H&R Block, among others. For more information, please visit blog.360i.com or follow us on Twitter @360i. NEW YORK | ATLANTA | CHICAGO | DETROIT | SAN FRANCISCO | LONDON | info@360i.com | 888.360.9630 ?2011 360i LLC. All Rights Reserved
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