The 6 Pillars Of Social Commerce: Understanding The Psychology Of Engagement

Social media is about social science, not technology. As such, its value is not realized in the Likenomics of relationship status nor in the scores individuals earn by engaging in social networks. The value of social media comes down to people, relationships, and the meaningful actions between them.

The exchange of social currencies contribute to one's capital within each network. Through conversations, what we share, and the content we create, consume, and curate, we individually invest in the commerce of information and the relationships that naturally unfold. It is in how these relationships take shape that is both in and out of your control. This is why, in the age of social networking, relevant engagement counts for everything.

One of the greatest myths in new media is that social networks facilitate conversations about you that would not otherwise take place if your organization weren't present. As such, some business leaders believe that creating a presence in social networks eventually erodes the control of the brand, risking the governance they've theoretically held on to so triumphantly over the years. So, if that logic holds, by not engaging in social networks or by sharing only one dimension of your business online, you can control what people think and say. Well, this always seems to come as a surprise to those who think otherwise, but the truth is that new media did not "invent" conversations, experiences, or opinions. It seems imprudent and perhaps commonsensical to say, but the truth is actually the contrary to popular belief.

The control you think you lose by opening up to online engagement actually gives you a sense of control. While we are measured by our actions and words. We are also measured by our inaction and silence. Once you understand what people say and don't say, how they connect, what they share, how they discover and make decisions, and who influences them and who they influence, a blueprint for engagement emerges. People will always talk with or without you. The questions you have to answer are, "What do you want them to say and What do you want them to do?"

The A.R.T. of Engagement

In social media and online engagement, the social sciences of psychology, anthropology, communication, economics, human geography, et al., are essential in building meaningful relationships and influencing mutually beneficial behavior. This means that you as a CMO, a new media or creative strategist, or an engineer of user experiences, must first articulate and ultimately design what it is you want the user experience to emulate or evoke.

I refer to the concept of social architecture as the A.R.T. of Engagement where actions, reactions, and transactions become the fabric of holistic and connected experiences. It's not as easy as deploying campaigns and landing pages. The click path, the outcomes, and the stated value must be optimized, efficient, and worthy of sharing. This is where social science, and in particular, psychology comes in. Unlike the traditional web, social media is a very emotional landscape where people are at the center of their own egosystem. You must design an experience that captivates the mind or feeds likely emotions to affect desirable behavior in a given context.

The Psychology of Social Commerce

The importance of social psychology can not be overstated. This branch of psychology deals with how people think about influence and how individuals relate to one another. In Facebook, Twitter, Google+, and every other network, the social economy within each is defined by how people earn and spend social capital. Based on the commerce of actions, words, and intentions (or actions, reactions, and transactions), individuals contribute to their stature not only within each network, but among those to whom they're connected. The same is true for organizations. You earn the relationships and the resulting stature that you deserve.

I recently stumbled across a rather interesting infographic that visually communicates the psychology of social commerce. The graphic was inspired by a series of studies that identified six universal heuristics that shoppers use to make decisions. Referred to as "thinslicing," consumers tend to ignore most information available and instead "slice off" a few relevant information or behavioral cues that are often social to make intuitive decisions.

Heuristic Number 1: Social Proof--Follow the Crowd

During the new customer journey (aka the decision-making cycle), a consumer may find themselves at a point of indecision. When consumers are uncertain of what to do next, social proof kicks in to see what others are doing or have done.

To influence decisions, wish lists, popularity lists, social sharing, reviews, and social recommendations become paramount.

Heuristic Number 2: Authority-- The Guiding Light

Authority in social media is not only related to commerce, but it is the very source of how interest graphs take shape. During the dynamic customer journey, authorities rise as the sherpas to guide in effective decision making. Authorities have invested their time, resources, and activity in earning a position of influence, and their reward for doing so is a community of loyalists who place trust in their recommendations.

In Edelman's recent Trust Barometer report, academics and experts topped the list for trust and credibility (66%), followed by a technical expert at a company (66%).

Heuristic Number 3: Scarcity--Less Is More

A function of supply and demand, greater value is assigned to the resources that are, or perceived to be, less available. Driven by the fear of loss or the stature of self-expression, consumers are driven by the ability to participate as members in exclusive deals. Part affinity, part elitism, consumers have expressed over and over that the ability to have early or select access to offers and promotions is a top reason to connect in social media.

Heuristic Number 4: Liking--Builds Bonds and Trust

There's an old saying in business, people do business with people they like. And, nothing is truer than that statement in social media. Revisiting the Edelman Trust Barometer, the third most trusted person is someone like yourself/peers (65%). We have a natural inclination to emulate those we like, admire, and find attractive as these attributes also contribute to the "guilt by association" impression of self-identity.

Heuristic Number 5: Consistency

When faced with uncertainty, consumers tend not to take risks. Rather, they prefer to stay consistent with beliefs or past behavior. When these do not line up in the decision-making cycle, consumers tend to feel cognitive dissonance or true psychological discomfort.

Heuristic Number 6: Reciprocity--Pay It Forward

Perhaps the greatest asset in social capital is that of benevolence. It's easy to get caught up in a cycle of paying it backward, where we expect to be paid or rewarded for our goods, services, or actions. However, those who invest in helping others or those who pay it forward will earn something greater than a reaction, they will earn a repository of reciprocity. As human beings, we have an innate desire to repay favors to maintain a balance of social fairness whether or not those favors were invited.

If ignorance is bliss, awareness is awakening. The psychology of social commerce reveals the emotional elements that stimulate the human network. It is the understanding of the 6 pillars of social commerce that facilitates the development of a more cohesive and connected online experience for customers. More importantly, by investing in the value, productivity, and efficiency of consumer decision making and not just the outcome, businesses can not only earn reciprocity and goodwill, but also earn social capital as a result...and, that's priceless.

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4 Comments

  • Linda Sasenick

     I just ran into this article, very much appreciate the discussion.  The dialogue about engagement being the precursor of a social and commerce relationship is really useful in thinking of social media strategies...thanks!

  • Jaime Wu

    Mr. Solis, I enjoy reading your post which integrates the six strategies of persuasion with business prospects in social media.  In the context of social commerce, persuasion, when utilized with appropriate methods, can certainly captivate more customers and hence, increases sales.  In the world where information and opinions are constantly exchanged and shared, and our contact with other people is no longer constrained by physical boundaries, social networks become our source of information.  Although there is no face-to-face interaction in the cyber world, we are nevertheless joining with other people, and the knowledge of human behaviors is practical and valuable in contributing to businesses growth, such as brand awareness.  As you mentioned in the post, "relevant engagement counts for everything" because of the inter-related framework of communicating information.  Establishing a platform which facilitates the conversations creates dimensions for certain products and services.  By including different users into the discussion, consumers' reactions and comments not only indicate their attitudes towards the products, but they also "create, consume and curate" the content and past it onto other people whom they are connected to.  While a cohesive and concise concept of social commerce is being demonstrated, I fell under the impression that consumer behaviors occur to be directed by a logical formulation based on the vision of these six principles.  However, we might be more helpless against our action than we assume; what are some other inaccessible factors that drive decision making in the context of shopping online?  Although the use of advertisement in social media predominately describes the significant principles of persuasion, I believe that it is equally important to investigate how intuitive decisions are reached and the differences between the initiation and the outcome.  Decision making is a complex cognition process which activates multiple brain regions to make judgments.  Simply put, a good decision is made when the expected value of the consequence is higher than its cost - the pros are larger than the cons.  In addition to receiving the information organized by the marketing staff in the business, our mental functioning is also attributed to the operation of our unconscious mind and emotions.  Through examining how the brain functions in the process of decision making, neuropsychologists conclude that 1) our brain automatically processes through mental shortcuts in order to avoid too much mental calculations when doing executive tasks (for example, stereotype), and 2) our judgment is based on comparing options available to us.  Even though the first feature may save our time and energy on a subconscious level, the shortcomings include the possibility of making poorer choices, and researchers at University College London also noticed depressive symptoms associated with bad decisions.  Similarly, the second premise is impossible to accomplish because we cannot make reference to all options.  Furthermore, Dr. Daniel Gilbert, who is a psychology professor at Harvard University, commented that the comparisons between goods which we have not yet acquired become incompatible with things we have already bought.  Because of these uncontrollable tendencies, solely following the six heuristics may not be as efficacious as taking all under consideration.  And the guideline is relatively useful only if we expect that potential customers will follow all these rules when they encounter promotion products.  Perhaps a more holistic comprehension of the individual's perceptiveness and seller's presentation can provide further insight on bringing success for businesses through the medium of social media?Link to my blog

  • Thomas Wendt

    Any time the question of engagement comes up, I always come back to: what does "engagement" mean? Almost every time, I receive answers such as "it depends on the KPIs" or "how 'deep' a user goes into content" or "a customer's emotional investment in a brand for the purpose of interaction." Clearly, we don't have a good working definition, which leads me to believe that there is no effective way to speak about engagement in general.

    I like the focus on social psychology, but I think sociology play just as big of a part. It's not only the individual user but also that user within a larger social context. Some of the figures in the infographic--which is very nice looking--are very unclear, such as "62% of online shoppers are brand loyal." Are they loyal to products or sellers? Both? Or "77% of online shoppers use reviews." What does that have to do with authority? It's more about influence (and not in the "influencer" sense of the word). This is where sociology can inform this conversation; it attempts to answer how people are influenced and motivated by their social groups.

    In the end, we have to make a choice between designing experiences and "engaging" because we want to share, or "pay it forward," or because we have such great things to say. Designing an experience has much more to do with achieving business goals and social transactions. It's okay to build a community based on a brand giving customers something they want/need/desire in return for loyalty. The social media space tends to think all online relationships need to be authentic and altruistic. They aren't in real life, and they won't be online (some will, but not all).

    You mention that a key to brands' social activity is based on asking themselves "what do you want [customers] to say and what do you want them to do?" This is the point at which the rhetoric of engagement crumbles. If we can assume that engagement is a "two way conversation" in which both parties are equal, then the idea of designing an experience--what do we want them to say/do-- doesn't sit very well with the idea of equality. Customers enter this conversation without preconceived notions of where the dialogue will go. Brands, on the other hand, have spent weeks, months, even years perfecting how they will guide the conversation toward topics that are beneficial for them. They might have even hired an outside agency to research, strategize, and design the most optimal means of generating more money under the guise of "engagement." Social capital is great, but it doesn't pay the bills.

    I feel like I'm always ending on this note lately, but it's worth saying: I'm not trying to determine what is right or wrong on this topic. I just think we need to be careful about how we sugar coat things and claim benevolent intent. The problem with experience design is that if the designer does not take into account the qualitative aspects of sociality, the project will likely fail. On the other side, if we rely on engagement and loose interpretations of qualitative data, it will also fail. We need to reach a midpoint at which educated, qualitative interpretations are paired with solid data. We need to design against business objectives without losing sight of the value of the non-quantifiable.