John Lawson on Social Commerce

There are many ways to market an online store, but these days one seems to get all the attention – promoting your business through social networks like Facebook, Twitter and Pinterest. It’s called social commerce.

Social networks are free and familiar, and get huge amounts of traffic. But it’s hard to be heard above all the noise, and easy to waste a lot of time. So what’s the right way to do social commerce?

To find out, I spoke to veteran seller and social commerce expert John Lawson. Besides his eBay store 3rd Power Outlet, John is a keynote speaker at ecommerce events, multiple winner of Small Business Influencer Awards, and author of Kick Ass Social Commerce for E-preneurs.

John was outspoken about the challenges and opportunities of social media for online sellers, and I’m delighted that I can share his expertise here.

Andy: A lot of sellers think social networks are not places to sell. People are networking with their friends, sharing photos, chatting about a restaurant they went to. They don’t want to be sold to. Are they wrong to think that?

No, people are not on social networks to buy something. It’s almost the same as if I say, “I’m going to take a walk in the park” and all of a sudden somebody comes up and tries to sell me something. I’m not really here for that.

But when I say, “I’m going to take a walk through the mall” then I’m in shopping mode, and I expect to be sold to. You have to realize that that is the mindset of the customer you’re trying to engage with, and move them from the walk in the park mentality. And you’ve got to be able to make a connection with them in the park before you try to take them into your store. I think people miss that.

Sellers feel like they have peoples’ eyes or attention because they hear everybody’s on Facebook. But the beauty of being on Facebook or Pinterest or any of those places, is that I control what gets my attention. If you’re out there saying, “Buy my stuff, buy my stuff, here’s a coupon or here’s my website”, they’ll totally ignore you. It’s very easy to do that.

Andy: So how do you get buyers from the “walk in the park” mentality to the “walk in the mall” mentality?

Harking back to the old way of eBay, I’ve always told people that it was the beginning of social commerce – eBay created social commerce. They had two things going on, they had the auction platform, but just as popular were the chat rooms. People would sit in the chat rooms and talk about the products, and what they were waiting for the auction to end on.

All this conversation went on inside the chat board, while the transaction was going on inside the auction platform. eBay was able to really grow by having those two things together. In the same way, to get people engaged on social networks you have to have a conversation. And that conversation has to be beneficial and of interest to your clients.

Let’s say you sell shoes. I’m not a big shoe guy, but it’s very easy for a shoe lover to have a discussion about the coolest shoes out right now, without having to really sell that shoe. Just the fact that we’re talking about shoes starts whetting their appetite to buy a new pair of shoes. And so, by the way, we’ve got shoes over here that are discounted 50% off today. You’ve whet my appetite for shoes and now I can transfer that into commerce. Does that make sense?

Andy: Yes, it does. But what if you’re the type of seller who sells anything that’s profitable? Or something that’s a bit boring, that people don’t have much of a passion about? Can those type of sellers use social media effectively?

I’ve sold a little bit of everything over the years. My theory was anything I can turn off and on, I would go buy it and I would try to sell it. So yes, you can do that with social media. But you’re going to have to start looking for the individual audience for each of those individual products, because you’ve not niched out into anything. It’s hard for a seller like that to really have a voice because you’re all over the place, you know?

That’s why I tell sellers sometimes, “You want to start thinking about trying a niche” because there’s riches in the niches. The generality is what’s keeping you on your day job, because you haven’t niched out. You’ve got to take what you’re learning and start applying that to a process so that you can become an expert in something.

I’m not saying that’s what everybody’s doing, but 90% of the time when you talk to a person that’s selling everything, they’ve got a day job. And the reason why they’ve got a day job is because they’re selling anything. At some point you want to take some of your resources, and start thinking “what do I want to sell? What do I want to specialize in?”

Andy: We all use social networks, and they just eat up time – your entire day if you’re not careful. When you’re using social media for business, how much time do you need to put into it? How do you know that it’s time well spent?

A lot of people do end up in this time suck, although what they’re being sucked into has nothing to do with business. I don’t know too many people that are like, “Man, I spent six hours today on Facebook trying to support and run my business.” That rarely happens. They’re doing all the other things they shouldn’t be doing and they’re not focusing in on the business aspect of how they’re going to use social to get more people into their store.

People definitely want to be more disciplined. For whatever time you give to that platform for that week or for that day, be focused, have a strategy and have a plan. That is what my book is for, because it gives you the strategy and the plan for what kind of content you’re going to put out there, how you’re going to promote that content and reach that audience.

The first thing we talk about is finding the audience. If I say, “This week or next week all I’m going to do is listen and find where the conversation is around my product, my services, whatever it is or whoever I’m trying to get the message across to.” That’s what you’ve got to do first. Now, when you login to Facebook you have an agenda. It’s not going to take you long to find that category of people that are talking about your product.

Andy: So let’s say you do that research and you find out where your customers are, but they’re all talking about your competition, or your competitors are already there engaging with them and seem to have it all wrapped up. What can you do then?

When you have competitors, that to me is a good sign that there is a lot of opportunity. If they’re talking about the greatness of your competitor, then you better be listening so that you can take some of those cues and add them to your business. So that’s a good thing, you want to listen to what people are saying about your competition.

One thing I don’t think a lot of people do is order products from their competition. Find out exactly what they are doing, duplicate the things that make sense, and make them better. People shouldn’t compete on price but that’s what a lot of online marketplace people are doing. I think it’s a bad thing to try to be the lowest all the time, because honestly, the problem with the race to the bottom is you might end up winning. So what you have to do is compete on being better, offering better services, better selection, having better pictures, descriptions, and definitely a better guarantee.

This is the reason why people think Amazon is the cheapest now. They don’t even look anywhere else, because Amazon has perfected the service level that people come to expect. We understand why Amazon has so many stark raving fans is not just because of a good price, but some of the best guarantees and the best services. If you can communicate that to your customers they will find and shop with you.

Andy: So how does that apply to social commerce, and finding new customers?

One of the concepts in my book that I really push is that social should be used for your current customer base. Look, it’s much cheaper for you to take a current customer and get them to buy from you again than it is for you to go out and find new customers. So when you’re thinking about social media don’t always think “how do I find a new customer?” How about making your current customers even happier?

Create an environment where these customers and you are engaging with one another. That becomes almost like a virus, it becomes something that spreads. People want to have that kind of community, be in that kind of community and that kind of environment. So what you need to do is really make a connection with your current customers.

If you’re going to start anywhere, that would be the first thing I would start doing, start getting engaged with the people that already love you, already love your products, already love your services. And start treating them the way that they should be treated. They will bring you new customers. You won’t have to go out and find new customers, they will bring you new business.

Andy: Okay, I hadn’t seen it that way. Maybe a lot of sellers out there just see it as making sales, rather than building a community?

Well do you know what? Customer service is marketing. And this is one thing that eBay sellers don’t get. They don’t understand why eBay makes these right hand turns on customer service when they make these changes. I don’t know about the last changes, but changes after changes after changes, they’ll make big right hand turns. And they’re always turns into better customer service, because what eBay does understand is that customer service for them is marketing. We need to understand that too – offering spectacular customer service brings more business.

This is why Amazon bought Zappos. They couldn’t compete with Zappos. No matter what they did in the shoe game, Zappos was still kicking their butt. So they were like, hey, can’t beat them, join them. Zappos grew specifically from two things, social media and great service. They offer an unbelievable return policy, one year, no questions asked. That alone made their customer base tell every other shoe buyer about shoes.

If you’re going to buy shoes online, you get a great price from these guys and if you don’t like them they take them back within a year. Boom! It was the lynch pin that propelled that company. And on top of that they had social media where people were telling other people about all the great service they were getting from Zappos, and that’s how that company got great. That’s something that we can emulate now. We can do what Zappos did.

Andy: You make a point in your book that social commerce isn’t new – business has always been about relationships and networking. The interesting thing about selling online though, is you can actually trade without a lot of interaction, and some sellers like it that way. Any advice for those sellers?

Well, that’s fine too. How do you translate it into social? That’s what the ads are for. Personally, when it comes to whether I like engaging with people and writing blog posts and all that kind of good stuff to bring in traffic, versus buying an ad that works, I like buying an ad that works. The reason why I like buying an ad that works is because that’s scalable. If you have a process and don’t want to deal with the social aspect of doing commerce, well that’s fantastic. You really don’t have to. That’s what social advertising is for – boom, put it out there. But of course that’s a whole different ball game.

You’ve got to see how it fits. And it’s not for everybody, that’s a myth. It has become such a sensation, social media for business, everybody’s like “social media, you’ve got to do it, you’ve got to do it.” You know, you don’t have to do it. It might not be the right time, the right place, the right product. The first part of the book is about figuring that out.

Andy: I agree, the hype is overwhelming sometimes. It’s great to hear a more balanced view.

I’m a business owner, see, all the other people, they’re pundits. They’re telling you all these things but my thing is, if it don’t make dollars, it don’t make sense. If I’m not going to get an ROI [return on investment] on this thing then I’m not doing it. I don’t care what all the pundits are telling me to do, if they knew what to do in business they’d be in business. They wouldn’t be writing about it.

Their business is to do what? Write about the hottest thing that’s out there right now that’ll get the most readership. As business owners we have to step back and say, “What is the motivating factor for this story?” And 90% of the time it is because it’s going to get more readers. The web is full of seven steps to doing, five steps to success, eight steps on something, you know, that’s what it’s filled with. That’s because it gets the most readership. But honestly, it’s not that easy. They just make it seem that easy because that’s what sells.

Andy: So how can people tell the hype from the solid advice?

Social media right now is sex. Everything else is boring. If you take the book and really condense it down, it really is about building an email list. The email list is still the best converting thing that a business could have. My approach in the book has always been about getting people engaged with you, and then ultimately getting their email address. Once you get them engaged with you and listening to you, they read your email because you’ve made it very personal to them.

Once you have that engagement with that customer and you can see into their social engagement, you get the cues that you need to market to those people. And once they’re actually reading your emails and that email is personalized, based on those social cues, you get results. That’s how [US fashion retailer] Gilt built its business. It is totally social. They send you an email every day saying, “this is what we’ve got going on today and it’s only going to be so long til it’s sold out”, those kind of things.

Andy: In your book you talk about creating personas – writing down the traits and preferences of a typical customer and giving them some personality. That makes it easier to figure out how you’re going to engage with them. But if a seller doesn’t know a lot about their customers how do they go about building personas for them?

You really do want to start listening to the customers. One of the things I tell people is, find out from the customer what their Twitter ID or Facebook ID is. If we’re doing follow-up with customers, sometimes we’ll ask them for their Twitter ID so we can follow them. Now, what you’re getting is permission from them to tell you everything they like, because you can look at their Twitter stream and you get an idea of that kind of customer. You start finding out if they have children, if they work, what kind of job they work at. You start finding out real actual facts about your customer base which was almost impossible to do prior to social media. You can really get a focus in on different personas that would appeal to these different markets.

Case in point, we sold hip hop gear. Well, we sold that hip hop gear with the understanding that it was going to an urban crowd that liked hip hop music. However, what we found out was that a lot of people that didn’t live in an urban area were also into that same culture. It took us years to find this out, and we had to really hone in on the data.

Today you can get that kind of customer information from their Facebook profile. So you want to use that, and now I know, hey, I’ve got skateboarders that like our products, I’ve got motorcycle enthusiasts that like our products, and I’ve got the hip hop guys. So that’s three different personas. And the way that I talk to the hip hop crowd is completely different to the way that I will talk to a motorcycle crowd.

I can have more than one customer service person talking on our Facebook page. That is a great way to use this, or you could still be the only one person talking, but make sure that you create content that will be specifically for this crowd, that crowd and the other crowd. And don’t do just one blanket email, make it three different ways for those three different crowds.

Andy: So if you’re a seller who has those different crowds, and you’ve got a Facebook page or group for your business, how do you manage to talk to the different segments with different content?

You can keep your Facebook page there as the overall image of the business. But you can create multiple groups that deal with just that segment of your populous. If you sell shoes and clothing and jewelry, you can have groups that only talk about the jewelry, you can have a group that only talks about the clothing and a group that’s only about the shoes, because those are different people that will get engaged.

They don’t have to be large groups of people, it can be very small. It’s like, look, this is our shoe group. We give out special deals, only to that group. It’s very private. If you want to become part of that group, sign up here. Now we let them into that group, and make it extremely private, we offer very exclusive access and make that really exciting for them. They don’t come to the group often, they only come to the group when they know that I’m putting out a new offer. Do you see what I’m saying?

Andy: Yeah, I do. It reminds me of Seth Godin’s Purple Cow where he contrasts modern marketing with TV advertising. With TV ads, you’re going for a huge audience and only a tiny percentage will be interested. But this is about looking for a really small audience and potentially a lot of them will be interested.

Absolutely, man, it’s a big pie out there. We just want a little slither of that, you know. All that kind of stuff would be so hard to do in the past, we used to segment a list and get people engaged on that, and then offer just to that list. Today we can do it with a Facebook group, it’s just that simple.

Andy: You talk about people creating their own voice on social media, and that it’s okay for them to create a personality for themselves. If they’re creating a slightly artificial personality, how do they retain that authenticity as well?

It’s like a writer getting into the feeling and the emotion of the character, you are being somebody else. And by doing that and feeling that, it’s the same thing. I also tell people, “Hey, get somebody on your staff to do it. Get your kids to work with you to help you, if that audience have a younger vibe, then get a younger person to help you with that.” I don’t want people to go out and be completely non-transparent, but there is a bond that comes from people not just talking about the brand but actually having a representative of that brand, whether it’s Tony the Tiger in Kellogg’s cereal, or the Pillsbury Dough Boy. These things don’t really exist but they help people to move and get more engaged in a personal way.

Andy: Moving on to something a little different, you said something interesting in your book about your returns policy. You extended your returns policy to 90 days, and got fewer returns. Why do you think that was?

The thing was I did it not totally for my customers’ sake, I did it for my own sake. The thought was if we extended it for 90 days it would be something that we could advertise. Everybody else was on a seven-day return, or a 14-day return. I’m like, you know what, I’m going to do something so stupid, I’m going to say 90 days. This is on eBay at the time when nobody was doing that long.

Here’s what’s happens. If I get a package and I don’t like the item or there’s an issue with the item or I find it cheaper somewhere else, any of those things, I am forced by that return policy to handle it right now, because I’ve only got seven days. I’m going to handle it right now because that’s on my plate right now to do.

But if that same scenario happens and I’ve got 90 days, guess what I’ll do with that package? I’ll put it somewhere, maybe on my desk. I’ll get to that next week. By that time I’ve put my mail on top of it or I’ve cleaned the desk out and put it aside somewhere else, so much so that by the time 90 days gets here, it’ll be day 91. I’ll look at that package and be like, oh, screw it, it’s already over, I’ll keep it. I just think that’s what happens. It’s the tendency of us to put things off so much that it’s no longer in our face and we don’t really think about it that much. But having a policy where they have to do something right now makes them do it right now.

Andy: I hadn’t heard it explained like that before, but it makes complete sense. Creating a sense of urgency is a great motivator, whether it’s something you want them to do or not. With a longer policy, the seller is sending the message, “I know you might not like it, just take your time to decide.”

Trust me, you will get somebody that returns it on day 89. However, with everything we do, like I said, if it don’t make dollars, it don’t make sense. Everything we do is about ROI – return on investment. When I make this investment of giving 90 days to return, I know that there will be people that will return on day 89. But with that investment, the return has been so much greater in being able to market this, being able to make people comfortable with purchasing from us, that I don’t even see it.

The thing is I work on percentages, so if our percentage of returns was eight percent and now it’s like four percent, there’s one of two things happening. People are returning less stuff and/or they’re buying more stuff. It works both ways.

Andy: Okay, I have one last question now. Even businesses with wonderful customer service sometimes get negative reviews, or see negative conversations happening about them on social sites. That’s a painful experience, particularly for small businesses, and the temptation is to fight it out. But what’s the best way to deal with it?

First, you have to realize this is not your child. It is not your baby. It is a business. If somebody says something about my kid, I’m jumping all over and I’m defending my child, but this is business, it’s not personal. It’s only personal if you take it personally. So don’t take criticism and feedback personally, that’s the first thing you do. Take the emotion out of it, don’t respond back, give it 24 hours, don’t type anything.

The next thing you want to think about is that whatever you say, can and will be used against you. You have to realize that what that customer is saying is in a public forum. And when you respond you’re not necessarily needing to respond directly back to that person. You need to respond thinking about the fact that everybody else that might do business with you is going to see how you respond. That alone should change the way you respond to this one customer. Figure it out. Figure out “how can I respond to make other people trust and believe in my business?” And that will change the way you respond to that one ignorant comment.

A lot of times, if you don’t respond it’s the best response. Just let it sit. Or even better, “I’m sorry to hear that”, that’s all. And I am sorry to hear that. When you don’t like something, I’m very sorry to hear that. I ain’t sorry about nothing else, I’m just sorry to have to hear it. You’ve got to take that approach, because if you’re not able or willing to resolve that issue with that customer in a public forum in a way that’s going to increase buyer affinity, no matter if the customer is a complete asshole, all the other customers are on their side already.

Nobody’s on your side because you’re the big business, just the way we think of eBay, our customers do that with us. We always talk about eBay as, “they don’t care about nobody, blah, blah, blah.” That’s the way our customers really feel about us. We’re the big behemoth to them. They’re always on that customer’s side. You’re not going to win arguing in public with your customer, you’re just not, there’s no end game where you actually win, no matter if you’re 1,000% right. Standing in a public forum and arguing with your customer and making your customer look like an asshole, really makes you look like the asshole. That’s all there is to it, you’ll never win, never.

Andy: So is there a better approach? Should they just ask the customer to phone them, and get the conversation out of the public forum?

Absolutely, man, take it off line. I always try to do the right and fair thing. Once I’ve done what I believe is right and fair, if that’s not good enough for you then I’m okay with that. I sleep well at night. Look, my mother gave birth to me and she’s not 100% happy. There’s nothing in this world that’s 100%. The earth spins on its axis and it wobbles, you know. We’ve got a calendar year of 365 days but it’s really 365 and a third so we have to have a leap year. Nothing’s perfect.

Only in the world of eBay do we really try to get this 100% perfect thing, and it’s ridiculous. It’s what keeps us up at night. I let the 100% go and I’m at 99.4% or 99.5% right now. Guess what, I sleep at night! Somebody just gave me a negative, okay, and my life moves on. If you’re trying to hold onto that 100%, man, that will kill your spirit, it really will because it’s not realistic. So I don’t freak out any more.

I call it, “when they popped my cherry”, when I finally got a person that would not remove negative feedback and I lost my 100%, all of a sudden I realized I had to let it go. And ever since that point I have not been up in arms about it, because I know that inside of me is the will to do right by my customers at all phases of the transaction. If my being right is not enough for them then that’s somewhere we’re just not going to, and I’m not going to go back and forth with you about it. Fine, you don’t like me, I’ll get over it. I’ve got thousands of people that love me, and your one response has no bearing on my business at all, it really doesn’t. It’ll be on page two by the time I get through typing the email.

Andy: It’s been fantastic talking to you John, I’ve really enjoyed it. Thanks so much for sparing your time. Let’s see if the readers have any feedback or questions.