Social Commerce

eBay and the socially layered business

Like Amazon, the other grand dame of e-commerce, eBay is tooling up for a new era of social commerce.  eBay has just purchased Brands4Friends, Germany’s largest private shopping club (3.5m members) for €152m ($200m).  Private shopping clubs, upscale variations on the Woot/Groupon daily deal theme (eBay launched it’s own daily deals Woot clone back in 2009), offer time-limited deep discounts on branded goods, and account for 20% of online fashion sales in Europe, with Vente Privée as the market leader.

Brands4Friends is a German-market centric minnow ($102m (£66m) turnover in Germany (nb Brands4Friends is also majority shareholder in UK private shopping club startup, compared to Vente-Privée $718m (£610m), but will no doubt help eBay grow FashionVault, it’s home grown private shopping club launched earlier this year).

This is the latest in a number of social and local commerce moves eBay has recently made:

What strikes us about this activity is that  social commerce appears to be moving into a new phase where it is less about evolving into a discrete form of retail, and more about becoming a social layer that is added onto retail (along with a local and real-time layer) or vice versa – an retail layer that is added onto a social platform.  In 2011, we’re likely to see more retailers (online and offline) add social, local and real-time layers to their businesses, whilst social platforms (and content hubs) will add retail layers to their businesses.  In 2011, if you’re in the social commerce business – you’ll be in the business of adding social and retail layers to businesses…

Chartered psychologist specialising in consumer behaviour, wellbeing and technology. Certified CX professional experienced in Design Thinking. A researcher, writer and speaker, Paul is head of Digital Insight at SYZYGY.

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