May 7, 2007, 12:00 AM

Socialize first, shop second

Social shopping sites are having a significant impact on how people shop, some industry observers say, and e-retailers should take them seriously.

For many who love to shop, the next best things to buying merchandise are browsing and chatting about merchandise-planning the next strike, so to speak. The relentless and continual evolution of social networking and consumer-generated content, together known as web 2.0, is enabling Internet shoppers to move beyond transactions to achieve shop-talk unlike anything they’ve ever experienced. It’s one thing to talk with a couple friends over dinner and get their opinions on the latest goods, but it’s something else entirely to get recommendations from and provide feedback to a couple hundred-thousand fellow consumers.

Social shopping sites enable just that, and in ways comparison shopping sites don’t and web retailer sites can’t. Social shopping sites connect consumers and give rise to discussions and recommendations, unlike comparison shopping sites, which typically focus on weighing product prices and attributes. Further, they are independent of e-retailer sites and e-retailer consumer product reviews and thus negate in the minds of many shoppers concerns about a dearth of negative reviews or an abundance of positive ones.

There are more than two dozen social shopping sites to date. They include Kaboodle, ShopWiki, StyleFeeder, ThisNext, StyleHive and CrowdStorm. Users register for free and create a profile that includes favorite products and product categories as well as information about themselves. They then add links to the products in their profiles or products they post on the site that take fellow users to a specific product page on an e-retailer site, where social shopping site users can make purchases.

Social shopping sites already are having a significant impact on how people shop, and e-retailers should take them seriously, advises Jeremy Dalnes, vice president of e-commerce at Panasonic Corp. of North America. “I have personally responded to consumer feedback on social shopping sites and blogs,” Dalnes says. “And you could see the difference before I posted and after. People reacted in a great way, saying they were happy with the way the company was taking care of them by responding.”

The impact of social sites already is noticeable, says Shyam Krishnan, program manager and team leader at research and consulting firm Frost & Sullivan. “E-commerce is being redefined: In this case, a multitude of shoppers are able to interact and pick and choose and recommend products with other shoppers online,” Krishnan says. “This will go a long way in helping online retailing.”

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