The social movement in retail has four stages.  Most retailers are still at stage 1.  A few are demonstrating that they have graduated and are moving towards “frictionless commerce”.  And those that invest now will create unique social experiences with their customers.

Stage 1: Social For The Sake Of Social. The goal here is to try and promote awareness of the brand.  Retailers in this phase (about 60% of those with a social effort underway).  You can find them because they are exceedingly interested in the ROI of the tools they are employing.  They are very tactical and just beginning to understand other metrics and how social impacts their business.

Stage 2: Enlightened Engagement. This includes a social effort with an emphasis on listening to the customer and having dialog with them.  It could be through video, syndicated reviews, real-time communication with experts, etc.

Stage 3: Store of The Community. The community gives input into what products and promotions should look like for the brand or store. For instance, Dell lets customers have input on new features they feel should included in their products.  It could also include merchandising strategy among other shopper insights.  “Companies realize that they can use new technologies - mobile applications, geo-location shopping and social couponing - coupled with emerging social technologies, loyalty programs and point of sale data to redesign the shopping experience,” said Cecere.

Stage 4: Frictionless Commerce. The overall shopping experience is redesigned with a focus on building customer intimacy and an extraordinary experience.  Customers are delighted and will want to share their experience with their friends. Push-based marketing will begin to give way to the momentum of community pull. Friends can buy with friends, new services can be delivered, checkout becomes more automated, and channels become more seamless.  Cecere’s further explained, “this is not just about putting your shopping cart on Facebook, but taking social connections and truly ehance this experience of shopping.  It has always been very transactional and impersonal. Let’s make it personal and better”.

So, the big take away for me is that the majority of retailers are early in the process (stage 1).  Many of them are waiting to see how things work for their competitors or others—but that is exactly the wrong thing to do!  Cecere warned that the problem with socially dipping your toe in the water and waiting for the other guy to figure it out is that it emphasizes the “sea of sameness”.  It means that you aren’t going to differentiate and attract customers.  You will likely implement something similar to your competitor—making it even harder to get your unique message across!

Instead, we should try new technologies and build efforts that you think will support and grow your brand.  And do it FAST. Try, learn, make mistakes.  Be first and learn what works for your company and your brand.

We (at DecisionStep) agree wholeheartedly.  Our best clients are using our collaboration platform, measuring what works, talking with their customers about the experience.  Then they refined the interface, challenged us with additional feature requests and ideas and streamlined the experience.  They are independently leveraging ShopTogether in different ways to connect their consumers to each other and to their companies.  This is the kind of extraordinary experience that will get you noticed and get you out of the “sea of sameness”.

In a tight retail environment and tough economy, businesses are looking for more ways to deliver a competitive advantage and a strong return. Real-time social shopping technologies cost a fraction of a typical retailer’s marketing budget and only take a couple of days or weeks to deploy. And retailers like Charlotte Russe that are using the technology have seen significant increases in unit lift, average order values and time spent on site, while seeing decreases in returns.

Another reason more retailers are deploying social shopping applications is because consumers are becoming exposed to real-time and near real-time communication on the Web with friends and family through sites like Twitter and Facebook. A telling sign of how far these networking tools have reached came from Facebook, which reported earlier in the year that the fastest growing segment of users was women over the age of 55. Online retailers realize they can now influence word of mouth – which has been shown in study-after-study to be the biggest influence on a consumer’s purchase decision – much more effectively by tapping into these vast networks.

Finally, real-time technologies have received high-profile attention lately thanks to Google. First, the company announced YouTube RealTime in April, which lets people interact on YouTube to see what their friends are watching, see a history of their friends’ recent activities and get notifications in real time when friends perform an activity like adding a comment or a favorite. Then, in May the company announced Google Wave, a real-time communication platform that combines email, instant messaging, wikis, social networking and project management. With the implicit “thumbs up” Google has given to real-time communications, more online businesses, both in the retail and other sectors, will likely begin to adopt these technologies on their site.

Given the clear benefits real-time shopping can deliver, coupled with the current state of the market and adoption of high-profile real-time technologies in other categories, it looks like 2010 will be the year that a whole host of retailers will follow the lead of some of the trailblazers like Mattel, Charlotte Russe and Buy.com.