Does social commerce mean socialopolies?
When I first thought of the concept of social monopolies- Socialopoly- I looked it up in urban dictionary and was surprised to see it hadn’t been defined yet. A search for ‘Social monopoly’ led to no direct results either.
When I performed a twitter search for the hashtag #socialopoly I got four results for some social game being played on Saturday nights. For the hashtag #socialmonopoly I got zero results.
So what is a social monopoly? A socialopoly? I am loosely defining it as when a brand, business, product, or person has a monopoly on social media and/or social commerce that creates a barrier to entry or bias.
The lack of conversation about socialopolies does not mean they don’t exist. There are already forms of social monopoly out there. For example, in the Ebay community where reviews matter so much- are you more likely to buy from a 5 star seller with 4 reviews or one with 10,000? Although reputation is a great thing, it can be difficult to build and create barriers to entry- for example people wanting to start their own Ebay store. On online platforms that track popularity- Facebook likes, Twitter followers, Ebay reviews… it works in favor of those who got started earlier.
Our world is becoming increasingly social media based with social commerce emerging as a dominant tool for consumers looking to make choices. This has the advantage of corporate accountability, better services and products, and reducing time consumption. Ninety percent of us trust peer recommendations. It becomes a social monopoly when it takes on this form:
Brand A had a few good reviews and was bought by Bill. Jane is friends with Bill and chooses Brand A as well because she trusts Bill’s opinion. Lauren is friends with Bill and Jane so she chooses Brand A. This continues and Brand A becomes the most popular brand in social commerce. Brand E comes out later, and is actually better than Brand A- but no friends have bought Brand E yet and Brand E has less reviews/followers. Even when Brand E does get good reviews, it isn’t as many as Brand A already has. Even though Brand E has created a better product, Brand A is at the head of a Socialopoly. Brand E has to work harder to get the attention of social commerce and faces a barrier to entry. In a world dominated by social search how does Brand E compete with Brand A?
Social media has been wonderful for connecting products and consumers. There are so many advantages to that. Customer loyalty is also a good thing. What we do not want is a popularity contest that prevents innovation, entry, and competition for new products in a similar fashion as it did before social media. If anything, the online world should become an accelerator for better products to rise to the top. We want to keep the power in the hands of the consumers for them to find the best products, not to perpetuate conformity. We do not want socialopolies.