Framework for Understanding the Business Model of Social Commerce

With the popularity and growth of social media, social commerce has been quickly emerged as a new phenomenon. It represents a shift in consumers’ thinking from individual decisions to collaborative decision. However it has not yet been fully understood, especially about the business model of different types of social commerce. This paper offers a literature review on the definition and characteristics of social commerce, and it proposes four types of social commerce platform. They are e-commerce-oriented social commerce, interest-oriented social commerce, social network-oriented social commerce and group buying-oriented social commerce. Different type should have a different business model. Finally, we study a conceptual framework for understanding social commerce business model from the key components, which are value proposition, revenue source, capability and sustainability.