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The challenge: Online advertising on Communitiesis not paying the bills.
Time to add new sources of income.
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The SocialCom approach: Social Commerce.
Social Commerce: It‘s not about Advertising – it‘s about Convers(at)ion.
Social commerce is what we do in the real world every day. We buygoods in social contexts and timing:
‣ A new digital camera when we plan our vacations‣ A new MP3 player when a friend shows us his latest purchase
and it’s indeed much better and cheaper than ours‣ A spontaneous gift for a relative’s birthday.
SocialCom is about employing these context and timing mechanics onthe Web.
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Enabling Social Commerce
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Product placement
SocialCom manages one of the largest product databases available onthe Internet, containing more than
‣ 50.000.000 products by more than‣
400 shops.Through a simple web application, SocialCom puts a carefully selectedchoice of products in front of your Community members´ eyes. Right inthe context of their Community interaction and custom tailored to userdata and behavior.
It’s not advertising – it’s product placement!
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Process walkthrough
MaleBerlin
39
Input:Anonymized,
clustereduser data
Output:Customized,on-the-yproduct
placements
Skate-boardShoeWii
MaleBerlin
13Lifestyle
3. Access partner shop2. View Product Placements 4. Make purchase1. Access Community prole
Purchasetakes place
on merchantsite
5. interactions (clicks, sales etc)
rating+
rating+++
behaviorinformation
deliveredto
SocialCom
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It’s about the Community
Your audience receives up-to-date and highly targeted productoffers in the form of a “friend feed” – including a best priceguarantee.
The quality of these recommendations increases from day to daysince SocialCom constantly renes them by feeding user responseback into the system.
You as a community owner make real money through salescommissions without worrying about product selection, shopmanagement, or billing and rights issues.
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Since data protection is a sensitive issue, Communities have to be restrictivewith their users‘ prole data. Consequently, SocialCom works withanonymized clustered data only. Clusters like:
For this to work, however, you have to know what kind of products theseclusters are most likely to purchase. How does SocialCom know?
Background
Males30-32 yrs
Rural northernGermany
Sports
Females18-20 yrsBig city,
south-westGermany Movies
MaleAll age groups
Travel
Males + Females20 - 30
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Product data + Socio-demographic data = Sale
Male30-40City
Travel
Male20-30Rural
Movies, Sport
Female30-40Rural
Pets, Music
Male + Female30 – 45
Rural + CityTravel + Pets=
=
=
==
=
=
=
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- condential -
Business model
* average: 8% Sales provision from Online Shops,Bundesverband des Deutschen Versandhandels e.V. 2006: AOV (average order value) 164 EUR
source: http ://www.spiegel.de/netzwelt/web/0,1518,451044,00.html
product placements 100.000
average click rate 3%
average sales rate 2,75%
average commissionper sales transaction* 13,12 €
your earnings 920,04 €
product placements 100.000
average click rate 0,75%
average sales rate 1,75%
average commissionper sales transaction* 13,12 €
your earnings 146,37 €
worst case best case
-
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Wrap-up: What it’s about
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Straightforward, sales-based business model: SocialCom pays out thelions share of sales commissions to partners.
Risk-free: SocialCom doesn‘t replace banner advertising - it adds a wholenew idea of e-Commerce to your site
Communities are free to congure the sources of product placement(i.e. shops) according to sales commissions or existing partnerships
Display of product placements is completely white-labeled andcustomizable for each community
No conict with data protection laws since SocialCom works withanonymized, clustered data only
Product placement is determined by socio-demographic data andconstantly rened by user interaction
Unlike banner advertising, SocialCom places products right into
user‘s community context
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About us
‣ SocialCom is a Berlin-based startup founded by a group of people withoutstanding experience in the Digital Media Industry and a proven trackrecord in creating internet services and boosting sales.
‣ We’re signing up the rst Community partners for SocialCom.
‣ If you’re interested to know more about our product and/or to be amongthe rst to monetize social interactions on your platform, please contactus.
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Contact
Christoph RaethkeFounder, CMO
email: [email protected]: +49 170 817 4460web: www.socialcom.de
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Male22-24Rural
Hunting
Male26-30Rural
Fashion
Male30-40City
Alcohol
HappyShop-Owner
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All rights reserved. No part of this document may be reproduced, transmitted or copiedin any form or by any means, electronic, or mechanical, including photocopy, recording,or any information storage and retrieval system, without permission in writing from the
publisher.
S i lC ® i i t d t d k f th S i lC G bH
Thank you!
"Product placement is another multi billion dollar market emerging right in front of our eyes.“ Ron Conway*
* Ron Conway is an American angel investor based in theSilicon Valley. Prominent investments: Google, AskJeeves,PayPal
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