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June 27, 2012

Retailers missing out on potential £9bn in online revenues

A study reveals that over 75% of retail sites do not have their own social community functions

By Cbr Rolling Blog

Social Commerce
Photo Credit: William Warby

According to figures by nToklo, a social commerce and recommendations platform, over 50% of retailers do not offer online recommendations to consumers.

UK online retail spending was over £68bn in 2011 and is expected to grow 13% in 2012. However, the study says that retailers could be missing out on billions of pounds by not offering consumers recommendations to other products onsite.

While social media is important to UK retailers, with over 90% having a prescense on Facebook on Twitter only 65% use integration technologies that some social platforms offer, like Facebook connect.

"Presenting users with relevant, timely recommendations has been an understood and valuable part of the traditional retail purchase funnel for a number of years, whether in-store or online," says Anton Gething, nToklo’s co-founder and product director. "However, with the explosion in social engagement, recommendation content is no longer provided by the retail brand alone and increasingly consumers are seeking out more ‘social’ user reviews and recommendations. Therefore, those retailers in a position to offer a cohesive social experience online will be in a position to take advantage of the potential growth in revenue available to them."

73% of sites surveyed do not offer consumers the ability to find or share recommendations through social platforms, which the study suggests could help give retailers a massive boost in revenues.

"The increasing interest in social commerce stems from the natural progression of two trends that have seen tremendous growth in recent years: online shopping and social networking," says Gething. "However, this research shows that social commerce is yet to become the sum of its parts and many businesses are missing out on a potentially significant additional revenue opportunity. In strained times, this additional revenue could provide a much needed lifeline for British retailers."

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