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Business Week just published a piece on the potential for Facebook in online shopping.  They focus on the role of Facebook Connect in enabling shoppers to post questions to their Facebook network before making a purchase.

It makes sense that this is the primary way Facebook Connect has been used so far in online shopping, since it’s the easiest to implement.  But it’s just scratching the surface.  The real potential is in bringing the social network to the shopping site (not the other way around).

For one thing, many people are hesitant to blast questions that they know are only relevant to a small portion of their network out to everyone.  No one wants to be a spammer.

Also, most shoppers don’t think of Facebook as the place to go when researching a purchase.  The primary research destinations are merchant sites and content sites that address the product category.

Combine those two considerations and what you get is a requirement for a system that runs on the merchant (or content) site and tells a shopper which particular people can help them with their purchase decision, so only relevant people receive the shopper’s questions.

If you sell online and this makes sense to you, check out the way TurnTo’s merchant partners are using the TurnTo system to achieve exactly this.  www.turnto.com/partnerlist.

According to a new Nielsen report, 20% of “social consumers” now discover content through their social contacts, instead of through search engines or content portals. Commerce is a type of content. This means that for “social consumers” (defined as those who spend 10 percent or more of their online time on social media), Social could become the new Search. What can online retailers do to tap into this new trend? Deploy tools that let your shoppers discover your products by looking at what friends and neighbors bought.

That’s the title of a recent article in the New York Times on research showing that the power of friend-influence is so great it even has a significant effect on your health.  The research was done by Nicholas Christakis and James Fowler using data from the long-running Framingham Heart Study and published in July 2007 in the New England Journal of Medicine.  We see implications for social shopping, as well.

Findings from the study cited in the article include:

• When a Framingham resident became obese, his or her friends were 57 percent more likely to become obese, too.
• A Framingham resident was roughly 20 percent more likely to become obese if the friend of a friend became obese — even if the connecting friend didn’t put on a single pound.
• A person’s risk of obesity went up about 10 percent even if a friend of a friend of a friend gained weight.
• A friend taking up smoking increased your chance of lighting up by 36 percent, and if you had a three-degrees-removed friend who started smoking, you were 11 percent more likely to do the same.
• If a person at a small firm stopped smoking, his or her colleagues had a 34 percent better chance of quitting themselves.
• The article also cited, a 2006 Princeton study which found that having babies appears to be contagious: if your sibling has a child, you’re 15 percent more likely to have one yourself in the next two years.

So, if the example of thin friends can make someone thin, and the example of friends quitting smoking can help someone quit, imagine what seeing friends shop at your store does.

The enhancements in this release improve both the user experience and the value for sites that use the system. Here’s a summary:

The widget now shows basic social shopping content to all users without requiring any sign-up:

• Items recently recommended by other shoppers
• Popular items
• The number of neighbors who also shop at the store and the items those neighbors have purchased (based on zip code matches)

Users can now import their friends list without ever leaving the widget and immediately see how many of their friends are also customers of the store and what those friends bought. All the information is anonymous, but shoppers can request the store to send a connect invitation on their behalf to those friends. This new approach has a number of benefits:

• Shoppers see more first-degree friend reference information
• Shoppers have a way to connect to friends who have not yet opted in to the site’s “trusted reference system” while still preserving customers’ privacy
• The sign-up flow for shoppers is cleaner and more intuitive

We’ve made a slew of visual and usability improvements.  Please go to one of our partner sites and have a look.

Sites currently using the TurnTo system will get this upgrade without any action required.

Here’s the full article: http://bit.ly/14Wl0n

And here’s what they have to say about us:

New York-based TurnTo Networks Inc., for example, which was launched in September, helps retailers link their customer accounts with social-networking accounts and email accounts using Facebook Connect and other tools. TurnTo charges retailers a percentage of the revenue from sales attributed to the system.

Tea retailer Teavana Corp. is a TurnTo client. Jay Allen, Teavana’s vice president of e-commerce, says the conversion rate—a measure of how many shoppers make purchases—for people who use the application is 20% higher than the rate for others, and their average orders are slightly more expensive.

TurnTo founder George Eberstadt says preliminary data for the company’s first 20 clients show that using TurnTo tends to increase conversion rates 20% to 50% and builds traffic to retailers’ sites. Some 700,000 new users, for instance, have come to computer retailer CompSource Inc.’s site through its TurnTo application since July. TurnTo is “a lot better than average” in terms of price per new customer compared with pay-per-click advertising, says Dean Bellone, CompSource’s president.

Would you walk into a great looking store if there are only salespeople there but absolutely no other shoppers you can see? Ever seen people peek at others’ shopping carts while waiting in line at the supermarket? Ever seen them reach out and grab a few extra products they hadn’t thought about buying before? Would you feel comfortable parking the only car at the shopping mall’s parking lot?

My father told me that when I’m looking for a good restaurant, I should walk into one that’s full of people. This would be a good indication that the food is fresh and the service attentive. Life experience has taught me to apply this advice more broadly to shopping in general, whether I’m looking to buy food, electronics, apparel, or book travel – take a look and see if there are other buyers around. And if there are – walk in with comfort and trust. I think it’s basic human nature – we take our cues for buying and shopping from other people, real people, that live, work, and shop in our vicinity. Some may call this “the wisdom of crowds”, other would say it’s “keeping up with the Joneses”. Whichever the case, when we’re shopping, we’re drawn a lot more into stores full of people. Empty stores are unappealing. They make us uncomfortable, keep us guarded, can even make us a bit suspicious, and certainly tight-fisted with our wallets.

That’s in the real world. What about online?

Shopping online is a lonely activity. It’s you and your computer. No matter how sleek a retail site may be, you’re there alone. You can’t see your neighbors. You can’t tell if the shopping site had drawn other people from the street. You don’t know if anybody else from town has parked their car outside. As a result, you’re not as comfortable about buying there as you would be if the store were a brick and mortar store, full of real people that warm up the place and that you can see shopping around you. Think about how much money internet retail sites are leaving on the table everyday because their visitors are missing that sense of comfort and trust that comes from seeing other human beings, people from the same subdivision, people from their part of town, shopping around them.

Now imagine that you go shopping online, and at the retail site you’re visiting, you can see people from your own zip code shopping. These are not necessarily people you personally know. Much like in the real world, they could be strangers. But they have a lot in common with you – they live in your area. And now you can see that they shop here too. You might even be able to take a peek and see what they’re buying. What would this do to your level of comfort? How much more appealing would it make this online store? Would this not give you this “warm and fuzzy” feeling that you get when you walk into a store at the local mall and it’s full of buyers ? Would you not find yourself getting curious about additional products you weren’t even considering when you walked in, because you can see some neighbors buying them?

These are exactly the benefits that the TurnTo widget offers online retailers and their shoppers. It brings online these simple and highly intuitive elements of local social shopping that we’ve all been so used to in the real world. The business benefits of the crowded store travel well to the internet shopping site – your visitor is a lot more comfortable coming in, browsing, spending time, engaging with your brand and your products, getting product ideas by looking at other shoppers, proceeding to the cash register, and giving you their credit card to place an order. Parting with your money is a lot easier and seems safer and wiser in a busy store. Chances are your online store is quite busy. Now make this busyness visible.

Last year, ecommerce sites that sell to “grown ups” sometimes told us, “We don’t need a social shopping strategy – our customers don’t use social networks.”  That was last year.  The landscape is changing at an incredible pace, and customer profiles in 2009 are going to look quite different.  Take a look at this article about the growth rate in the over-55 Facebook population.

http://www.bizreport.com/2009/02/is_facebook_going_gray.html

Here’s the TurnTo presentation from the OnMedia conference today.  This talk focuses on the whole idea of “Trusted References”.  The TurnTo part goes from roughly minute 1 to minute 10.  (I’m hoping the conference will provide a version of this without the side-bar.  I’ll upgrade if we get one…)

I just got back from the Social Networking Conference in Miami.  Here’s the presentation I gave, titled “Ecommerce Meets Social Networks: A Different Approach to Driving Online Referrals”.  The usual caveats about slides-without-accompanying-commentary apply.

We just rolled out Rave.  If you’ve had a particularly good experience with a product from a TurnTo network site - the sort of experience you’d normally tell your friends about - rave it.  Your TurnTo friends will see your rave in their TurnTo news feed, and you can also push it out to your Facebook friends.  (Coming soon: you’ll be able to push your raves out to other networks, Twitter, and the like…)  Other people can see your raves, too, but we don’t push it to them, and they don’t see your name as the author.

How come only “rave” and not “pan”?  The main idea behind rave is to make it easy for you to bring something to the attention of your friends that they might find valuable.  Getting warned off of a bad product is useful mainly if you were already considering it.  There’s no need to tell me not to get something I didn’t want anyway.  But getting alerted to something really special can spark a brand new idea.  Plus, we wanted to focus on the positive.  And a lot of our partner sites already have tools for collecting ratings and reviews, so we felt it was more important to focus on the communicating-with-friends aspect than on collecting scores and feedback.

We’d love to hear what you think.  Please drop us line.