Wednesday, September 21, 2011

How Discovery will make transactions

window shopping

Editor's note: Guest correspondent Semil Shah is an entrepreneur interested in digital media, consumer Internet and social networks. He is based in Palo Alto and you can follow him on twitter @ semilshah.

All year round, I heard some variation of this phrase: "big transition from search to discovery, is now online. I still know what it means. I would like to share your thoughts on it and I would like to hear what discovery on the Web means to you.

Firstly I do not believe that there is a shift from search to discovery. Shift is not the right word, because people will continue to look for years based on a specific intention. Secondly, although the opening will not replace the direct search, detection can affect it significantly changing how or where we are looking for. Thirdly, there are two types of detection that are: (1) opening, resulting in a transaction; and (2) it does not end in a transaction.

With this working definition of "open", perhaps we can now say: "the big shift is underway is the Act of detecting can come online, can influence how we search and could help drive deals".

Before you consolidate social network when we bought something online, it seems, the decision-making process that kicked off this transaction began in offline mode (See Amazon and eBay for the fun of it though). Discovery, largely originated in the real world. Now, more people online (and in various social networks), the upper part of the "funnel" begins to create for many online, not offline. In other words, the origin of the decision to purchase something which can be started while we're online, most likely because we actively interact with or passively observe someone we know (friend), or somebody we are interested in (follow).

As Discovery comes online, it certainly will not replace search, but it may have an impact over time. One of the main challenges is our current online behavior. Google is so effective in helping us to find relevant information, skeptics warn that even if the user finds something online to buy, he or she will likely visit Google to find it. In such a way that the opening to the tangible benefits of social networks that help users discover things using data for personalization and targeted information, to create powerful incentives for users not to go on Google to satisfy their intention and to find a way to make a purchase.

For example, if you know what, we discovered, can he recognize the element and provide pricing options and keep appointments, as targeted advertising? What if the user who helped another person open something gets revenue search? In this scenario, the user does not have to visit Google in theory because the conversion from discovery to search for transactions happen on its own. Site that ignites discovery will be rewarded with this income, but to make a real impact, detection will occur to many people. It may take some time.

If you can scale, change behavior and drive another type of transaction in the future, you can also streamline transactions?

You're on Facebook or Twitter. Friend appear in your channel, excited about the new album it is purchased. This one affects your taste in music. Facebook or Twitter identifies the album and provides three options on the right guide for you to purchase the album from iTunes. You want to buy the album, and what to do if you could just click one button (for example, "apply Facebook credit") and let Facebook or Twitter drive transactions and settlement of payment through the service as just sell or Gumroad while you draw inventory from another site? In this scenario, the user finds and buys something in one swoop, never really leaves the site and bypass traditional search.

All this does not happen overnight, although it certainly is now. As someone begins to form the idea of buying and learns that buy something, social networks provide an extremely powerful signals and filters that can influence and purchasing decisions. Learn about the new product from the right person at the right time in the right context, such as the interests of (explicit or implicit) or location (mobile), can bring the entire decision-making process, from discovery to find the payment in full within the same site. Opportunities are so great, and that is why sites like Pinterest, Everlane and Svpply, inter alia, had caused so much interest from customers and investors.

Ultimately all this is going to come down to what users find it more convenient or delightful. Although the user might want to hunt for cheap price of the product, he or she may be willing to pay a little more if the product recommended by someone they know, and if they have reasonable assurance that they receive a fair price from the recommended merchant. The user may elect to stumble on something new, purchase or impulse buy without ever going through the entire process of "normal" online solution. With so many choices for each product, little noise and proposals can be enormous, and true detection can help both sides of the market to find better signals.

In addition, it is difficult to predict just what will happen, or how long it will take to unfold. This is only one point of view. That means online detection for you and how you see its evolution in the Internet?

Photo credit: Cougar


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