Social commerce was premised on the idea that if you have a community of engaged users on a dynamic enough platform, somehow commerce will happen.

That’s the promise inherent in F Commerce and the culprit behind the ill-conceived notion that somehow every social act is measurable as a pipeline for a sale.

Having a business model that works economically for large engaged communities is one thing. Think Facebook and targeted ads. Old school media with deep social hooks. As these numbers from Ad Age show, it certainly works.

Having an environment where goods and services change hands is another thing altogether.

Facebook, with 800+ million connected people, has remarkably little commerce, if any. Funnels of influence and lead flow, brand building and reputation peddling but seemingly transactionless. I keep asking my networks for examples of commerce on Facebook and keep coming up empty.

The why of this is not obvious.

The social twins, community and commerce, should by nature work together. They certainly do in real life on the street level. Shopping is social by design. Malls as a concept do work.

But the logic of replicating what happens in the real world invariably fails on the social web. We need to think beyond the behavior to commerce itself, and whether a store and a discrete location are still a relevant definition of retail.

Facebook imagined that the pedestrian mall existed at the intersection of personal and fan pages on the social graph. This is the old retail crowd formula that location is everything and if you put up a store where there is qualified foot traffic and brand recognition, sales just happen.

Or so was the thinking.

Community designers know innately that you can’t bolt social loops onto commerce sites and expect them to be reborn as community. Most every legacy business and many start-ups have tried with little success.

It’s clear as well that you can’t bolt commerce onto community and expect a marketplace to materialize. The human dynamic that bonds offline around a sense of place and socialization is misapplied. Thinking about online as a virtual mirror of offline never works.

This doesn’t imply that social and transactions, commerce and community are disconnected. Not at all. Just ill-imagined.

We need to move past this narrow idea of social commerce and think of the web as one economy with funnels of community and commerce around niches of interests and intent.

My friend, Mark Essel and I, have long debated the community commerce dilemma. Communities of interest, no matter how dynamic, reject overt commerce as foreign even though off community commerce between members happens frequently.

With communities of interest, the intent is engagement in a many-to-many model. The open mike, town hall idea with handshakes and deals struck in the parking lot. With marketplaces, commerce is the intent, with a one-to-one model, where socialization and referrals happen outside of the  community.

Think about the social design aspect of virtual worlds. It was all about place. We moved from place to place like wanderers through a desert, knocking on niche doors. This was community as a virtual world before a social web inhabited by real people.

Facebook, and AOL before it, define themselves as virtual places. As intact platforms. Gesture and engagement, socialization and commerce, referrals and transactions are all-inclusive.

That’s the wrong turn.

The only platform on the web is the web itself. Not Facebook nor even Disqus as the connector.

There are deep communities of engagement and interest like avc.com. Deep marketplaces like Kickstarter. But the commerce around communities happens elsewhere as does the community around marketplaces.

But both happen. Focused intent to engage around discussions or focused intent to buy are facets of the whole, which spread out like threads between our connected lives. Between an online catalog for the Gap and the approval of our friends on what clothes we buy.

This idea has been crystallizing  as I’m reading ‘The Intention Economy’ by Doc Searls. The principal theme of the book, underneath imagining a new future, is that the web is about me. And you. And each of us individually on one platform that we all inhabit.

Products like engag.io attempt to put a moving lens on all of our engagements as we move around the web. They follow us, not us them.

The rash of flash popup sales sites like Shoplocket, are tying transactions to shares, inventing Sharing 2.0 as inclusive of commerce.

This points towards an idea that each of us carries a personalized Point of Sale system as a commercial mirror image to our social or community core.

This bridges not just the community and commerce paradigm but the off and online one as well.

When I think of huge brands like Nike with massive fan bases, both on and offline, I would bet that in the near future their connection to their customers will  be just one click away from a sale wherever the fan might be. The store will be wherever the fan is and sharing will carry an embedded transaction.

I’ve believed for some time that community existed in the connecting thread between URLs and web places. In the tissue of the web and society itself.

There is truth to that but the dynamics of the web itself as one ‘place’ is more about community and commerce being wherever we happen to be. Individuals as a gyroscope tilting one way or another and carrying our connected social loops with us.

Technologists think about this as an open sourced web. Community designers think about this unfettered individualism and communities without walls.

Same belief. Different words. Both right on.

When all channels were brick and mortar, all communications print and even electronic media had a cardboard package, there was this marketing thing called a ‘launch’.

I spent two years of my early career on the road doing launches–over and over, city by city, by country by channel rolling out tech and computer game products across the globe.

I had online communities of enthusiasts and developers who fed a hybrid model, but offline distribution was king and set the rules and schedules.

This was the rolling ‘big bang’ theory of marketing in its heyday.

Companies today still fabricate availability, date and time scarcity models. And if you sell flowers, Valentine’s Day is still your season for roses. But for the most part, the ties to the physical channel are gone.

Consumer status quo today is all about democratized distribution and customer choice. Online is the new norm and niche marketplaces are steadily becoming ubiquitous.

Yet somehow this idea of a ‘formal launch’ trapped in time and space has a resiliency against change. It’s a misunderstood idea misapplied to today’s market realities.

Every day, smart innovative companies with amazing social pedigree or game changing products ‘launch’. They formally come out of Beta and push frantically for coverage in the handful of tech publications. They may have a product but they are missing the point mostly. It’s not just about the product. It never really has been.

Something is out of whack and most of the sense is getting lost.

My takeaway from hundreds of launches, and why I still love orchestrating them, is that they are a focused, collaborative effort between sales, marketing and product . Integrated at their core. It’s a runway for market discovery.

This was true whether the event was a folding table at the Kansas City Marriot or two double-trailers full of booth paraphernalia rolling across the country from one convention hall to the next.

Sales, marketing, distribution and product were all part of a selling effort to build brand, communicate value and pound a hole in the din of the convention hall to get heard.

And online today, with a serious consumer attention deficit syndrome running unchecked and the one-click power of buying anything most everywhere, this integration and iteration is more critical than ever.

But somehow the popular (and quite brilliant) idea of a minimum viable product usually stops at product alone. Collaboration with marketing, sales and even customers is often a second thought. Launch is a baton handoff from product to market building with seemingly little foresight.

It just doesn’t work that way.

Real world, brick and mortar analogs of doing this right.

This idea of ‘always at launch’ is not a hothouse, online, techy fabrication. I keep running into gyms, restaurants and even food trucks that seem to get this idea of iterative product and community development innately.

A friend of mine opened up a new restaurant a few years ago. I got to watch this non-tech, brick and mortar example of always at launch up close and it exemplified brilliantly to me the dna of this idea.

The restaurant rolled out slowly to enthusiast groups.  The first were closed, friends and family. Free meals. Limited choices. Restricted serving times. The goal was to iterate and build a community base of customers and get the menu and service right. Then expand the groups to an ever-larger public over time and test new menu assumptions.

Social media loops were opened up and expanded naturally as the fan base grew. The menu was finalized and data gathered to figure out the margin nits of whether lower mark ups on wines lists drew more revenue per plate with less turns. Lots of  market data gathered and tested out a little at a time. There wasn’t so much a formula to follow but a trend to discover.

And oh…the restaurant while open and a huge success is still not officially launched.

Or rather, it is still at  launch every day, changing, getting more focused and better with each iteration.

What struck me was that in the brick and mortar world it was doing such a great job of iterating product, building community groups and exemplifying the reality that great food is in the mind of the customer not just the pots of the cook.

This is a telling example of ‘always at launch’ and relevant whether you are selling ribs on the corner or job referrals or artisanal wares online.

Why does this matter to web-based businesses?

The greatest scarcity on the web is customer attention. It’s without a doubt the new currency as it is in short demand.

Success is always just a click away and failure to engage, a click to leave. You have a second to capture that attention and create value and lay the seed for customer belief and eventual loyalty.

The idea of always at launch today needs to start with this respect for the scarcity of consumer’s attention. And the understanding that getting traffic is a lot easier than getting engagement and usage. In fact, traffic with a bounce doesn’t’ matter at all.

A focused complete response to a customer’s interest is as germane to a startup slowly moving out to the public from a base of loyal enthusiasms, as to a campaign for larger companies leveraging their existing customer base.

What works for me?

I’m asked everyday to try new products and participate early in product tests. I’m a tough Beta guy as my attention span and tolerance for boring are both very low.

Certain general ideas though are just ‘Must Haves’ for me and generally, I think,  for any mass market.

Launch Must Haves:

1. Make every day, launch day, for every new person who hits your site.

Engagement is an earned vote of confidence at that moment. Whenever I show up I want it to be special, interesting and all about me.

2. Connect your customers to each other, not just the company, as key to building community.

Your job is to connect me to likeminded others. Opening up a site publically until you have the kernel of a community is a certain recipe for a very slow climb, if not failure. In restaurants that may be friends and family. Online the idea still holds.

There’s nothing cosy about an empty room.

3. Inspire me.

Sell me on your promise and the excitement of the future. Your product is early and incomplete. It’s a mini version of your big vision. Get me to see and feel it.

Don’t ask me what I want. Show me what makes a difference.

4. Be there and lead.

If there is no new content. No connections. Not an intuitive next step for me. Or a blog post with an active comment stream that hasn’t been updated in a week, ask yourself, “Why should I be there?”

If you can’t answer that you don’t deserve my attention.

5. Understand why I should care and why I should share with my friends?

You don’t ask the customer what they want. You learn by making the leap, providing something and interpreting their response. You need to sell value. That’s what companies do at launch and every day onward. I posted on this a while back: “Why care? Why share?”.

This is not easy.

It’s part aspirational, part reality.

From a customer view, if you were the customer, there’s no argument. This is what they need. If you want their time, make it so.

From a company view, it means a refusal to accept putting outmoded and misconstrued modes of market building for a new market and new consumer behaviors. And an insistence that you put yourself in your customer’s shoes and understand their point of view, every day.

Everybody loves the idea of big bang. Of your logo on seat cushions at the Super Bowl. Or the wacko idea that somehow you just do this one thing and it all falls into place and starts a chain of events that ends up in success.

It’s just not so. We earn our customer’s attention, one engagement at a time.

This past year for me was all about trying new services and technologies to solve core business problems for a changed consumer culture.

I downloaded scores of mobile apps. Participated in scads of betas for cool new products. Used web-based solutions for every possible thing I needed to know, do, purchase or share.

But the number one source for information, places to travel to, wines to drink, marketing tips or referrals wasn’t any of these new services, individual apps or even search.

It was my broad social networks and a few powerful vertical blog communities.

I have strong connections around my friends’ blogs and my own, but most of the information I get still comes from my social networks, especially the big three–Facebook, Twitter and Tumblr.

When I was in need of a new restaurant or wine bar in Paris, some consensus on whether social TV is a myth, data on vineyards in Friuli, Italy, the best source wasn’t Q & A services (there are many), or travel or wine apps, it came from my extended friend networks.

And if you are a business, you really have little choice but to look to these social networks as well to find customers.

Quite a surprise actually. Disappointing to discover that the deepest contextual connections are still within the broadest most horizontal platforms.

The irony is that a multitude of the smartest entrepreneurs are parsing the world of information, commerce and socialization to verticalize our life experiences with the intent of building more focused and efficient communities of interest.

The human experience has been dissected into atomic pieces and there are seemingly endless apps and community platforms targeting each one.

But few of them really worked for me.

I’ve got to wonder whether I’m the odd person out here. But I don’t think so.

Some of the verticals themselves aren’t a true standalone social behavior with community chops. Check in apps for movies and TV are for me a case in point. I’m a serious movie geek and share info often, but have not been able to use any of the many media community apps with any consistency.

Some are interesting but are missing the transactional piece as an offshoot of information. Wine communities (and there aren’t really any of import) have not solved the ‘how to buy’ piece and to hear about wine that you can’t find or buy is a non-starter. You end up with flash sales (Lot 18), media sites (Snooth) and a plethora of blogs with a lot of info but little sense of engagement.

Some are perpetually stuck in the chicken-and-egg state. They have no real value until they enough people and just can’t draw enough of a crowd to matter to the participants.

And many, as smart as they may be, are more product idea than market reality and are churning to find users without understanding their core promise or a sense of how community can inform their business model.

And some may be just too early to tell.

There are of course, a few that really work and set the bar high. But very few.

Look at Fred Wilson’s avc.com as an ideal. It’s a place with loose structure, deep context and strong leadership. It’s a magnet for the intellectually curious around the entrepreneurial endeavor. One of the real ‘places’ to hang out online. Arguably the most dynamic community on the web today. It truly adds to my life off and online, friendships and business both.

Small, still new, but with a more focused and smaller niche, for authors there are places like Wattpat. For knitters, Ravelry. For developers and programmers quite a few.

Music is a community vertical with deep success. Turntable.fm, exfm and Soundcloud are all remarkably exceptions, each in their own way. They really get who they are.

And on the marketplace side, Etsy and Polyvore stand out as communities driven around commerce.

What makes them all work, as different as they are from each other, is a sense of community.

Conversation and engagement are the key connectors. They may spawn commerce but they certainly forge a connection with real life. Friendships really do happen. As well as customers.

I’ve blogged on this theme of context as a filter and community as the core of commerce all year. It’s true and I’m convinced of its validity.

Yet it is just at its early beginning stages. There are remarkably few great examples. Maybe the time for them is just in front of us…like 2012.

Facebook and Twitter are powerhouses of connection, though not suited for conversation or engagement. Wildly heterogeneous and useful for certain of my vertical interests like marketing and wine, it’s just a matter of time before the communities relocate. This is a population without a base using Facebook as a proxy.

On Facebook connections do broaden but it is more exception than rule. You bump into interesting people then move the conversations elsewhere. You just can’t get to know someone there. It’s a nod of the hat, not a handshake.

Dynamic communities, many of them blogs are where life and business connections happen. There’s been a buzz that blogging is dead. Just plain wrong in my opinion.

The past week I’ve been reading all the year-end predictions. There are many. Endless lists of what will be hot and what not.

Mobile end points. Tablets. Cloud based portability of data. Personal empowerment. The driving force of individual passions. All very good and true as themes for the future.

For me though, the business landscape for next year is not about tools or new markets or waiting for the market to catch up with your innovation. It’s more about bridging the self evident market gaps.

Gaps between a population that has shifted in its consuming habits and businesses that are seemingly clueless in how to connect with them. Huge gaps in the platforms for referrals that really work. Gaps in financial services, travel, wine and community access to local services.

Not all of these are new. Many just don’t work yet. And almost all of them have tried to exist on Facebook. They are invariably the right idea in the wrong place.

We are at a time where community and marketplaces are both possible and needed. For information. For friendships. For business. And for social change.

We are at this unique, and very cool place where culture is changing, online and offline are no longer distinct, access to markets democratized, and technology a vastly powerful, affordable tool available to everyone.

This is all upside and possibilities.

And the simple truth is still key, that the web is not about commerce or information or things. It is about people. And that commerce and community will follow if you discover the right connection in a viable context for the people themselves.

This is nothing but opportunity for businesses and benefits for the consumer. The problem is  not scrambling for ideas but focus on which ones to pick.

2012…bring it on. I’m ready!

Conversations are what make the social web work.

For me personally. For communities. For businesses.

There are large gaps between the conversational dynamics of Disqus-powered and WordPress blogs, posts on Facebook, comments on G+, remarks on FourSquare, Tweets on Twitter.

Each of them is useful. Though on their own no one is enough.

I’m increasingly isolated in these conversational silos. I’m stymied by the need to manually connect conversations between communities. It’s counterproductive and usually the true value of the social data is lost.

Links may be the universal currency of the web but they are more like monopoly money, less like value to me. I care what you think about something you share as much as what gets shared. Most of what we share is without useful context cross networks.

The handful of communities that have dynamic conversations are still uniquely separated from each other. We all spend hours following links, book marking them and bouncing around from referral to referral.

I so want the process of discovery to be fun. I’m fine with working hard at it but it feels random and primitive and somewhat arbitrary.

A few years ago, I wrote a blog post on the community potential of Disqus. How it could change how we find and interact with information and people. I was (and still am) inspired by this grand idea although less patient than I was then.

Disqus held the keys to the conversational kingdom with the data for some 1M blogs, 10s of millions of power commenter’s and innumerable comments across the web.

Disqus put granularity and detail on a dream world where each URL is its own community connected by threads to others. Some known, some in the process of being discovered.

Underneath this ecosystem of Disqus data lies an implicit future where a universe of suggestions could be fed to me just by understanding my interest footprint.

The more I express myself, the more I find what I want without asking.

Disqus may or may not be working on this. I don’t know. But regardless, Disqus alone is not comprehensive enough on its own.

Each of us has networks on other commenting systems and a multiplicity of social nets. These communities aren’t merging any time soon. Centralization needs to happen between communities, not within any one of them.

I’m dreaming hard for a conversational-based reality online.

I want to parse my world by conversations by topic by trusted connections daily.

I want a dashboard that lets me search:

-By topics by blog communities ranked by dynamics and engagement.

If I start the day on avc.com, for example, in a sub-string on Apple Airplay, I want to find out where there are dynamic conversations happening across the web on Airplay and connected TV.

-By trusted friends who are subject matter experts.

Something breaks around certification of organic wineries in Europe and percent of sulfites allowed for exported wines. Where is ‘the Crazy French lady’ commenting? Where are my wine expert friends from London and Portugal commenting? Where can I see this at a glance?

Google is useless for this. So is Disqus. Facebook is actually the best.

-By implicit generated interest graphs.

Look at any of your last 100 comments and a pattern of interests will arise. For me it will be on community, marketing, wine, travel.

Where is my daily leader board of what’s interesting for me without explicitly searching for it? Where is my recommended interest report?

Where is my listing of dynamically generated wine tastings that I would like in NYC this week with friends already signed up to attend? Or in London or Paris when I’m traveling.

I probably get 60% of the above in a couple of hours work each day.

The data is there. It’s just disparate, not mashed together in a human consumable form that is palatable for me. Or anyone.

Many companies are trying to solve this.

The launch of my friend William Mougayar (@wmougayar) Engagio alpha this morning is a great example. They are very early but they get the discovery/aggregation piece well. The code to get in the alpha of Engagio is engagearnold.

I want broad access to a human web interlaced by conversations connected by implicit suggestions.

So do many others I believe. Understanding social data is the Lingua Franca of the future. It needs to be understood between networks, not within any one of them.

The large social networks need to open their data to developers to build this in a multiplicity of shapes. For each of our needs. The networks don’t own the people but they do own the data. They need to learn to share more through their APIs.

Social data sharing will be better for me, better for everyone and equally, better for the networks themselves.

When I’m the center of the world, not the networks, I’m glad to participate in the ones that matter. I’m centered and flexible and easy.

When the networks are the center of the world and I’m a club member, I’m always looking for another club that will do what five of the others are trying to. I’m a migratory social animal always on the move and ready to jump. No allegiance at all.

Ok. Fun rant. Feeling better already.

Remember when niche used to mean a market too small to matter?

Not any longer.

The flatter the connected world gets, the more relevant and attractive small and focused seems over broad and general.

A niche market approach is not only a valid business strategy, but a potential antidote for business ADD.

A redefining of the term ‘niche’ where too small to matter may very well mean focused enough to win.

A great post by Om Malik, “Dawn of the micropubs”, brought some granularity to this idea of a niche being a business model of choice rather than a market too small to care about.

Om’s point of reference is viable publishing micromarkets defined by passionate founders around focused content categories. Aggregated free communities supported by affiliate and advertising revenue. It’s a quality traffic play.

His data point that almost 50% of niche micromarket traffic sources are keyword searches is a reminder to all of us about the dynamics of search. The more specific the content, the more valid and useful the search results. This is an old SEO and SEM truth that plays well here. And for the business model, the more contextual and relevant the community that gathers around those interests, the more valuable lead gen and advertising eyeballs become.

Om’s thesis around micropubs, and one I’ve been applying to my accounts for awhile, is that a highly verticalised, independent model is not only workable, but often the best response to a broadly horizontal and unsegmented social world. Or simply, the social graph, Facebook defined, is really challenging to build a business or brand on. And it’s a mistake to make the center of your business anywhere but your own URL.

The sharp focus of a niche approach to business both deepens and broadens your market. A finer net captures more of the higher quality users rather than a larger sieve, which is forever churning for meaningful connections.

As Seth Godin said in his post today, “Products and services succeed one person at a time”. The more specific that connection, the more clarity you have on how to make that interaction successful.

I’m a big proponent that you get farther faster by focusing narrowly with intent as a starting point. This may seem obvious but whether you have an early product for which you haven’t discovered the customer connection, or at a later stage noodling over how to expand faster, singular, passion-point focus on single-need, customer connections just works.

Connecting broadly isn’t the challenge on the web.

Quality connections around relevant and personalized information and products is. A niche approach to market development focuses on this above all else. Boiling the ocean doesn’t work. Spamming your networks is not only ineffective but somehow rude.

I’ve blogged on the power of the niche community as a filter. Om’s post made me think about that this more broadly, as a model in its own right. A focus in market terms and a different perspective on vertical segmentation.

We’ve all done the vertical segmentation whiteboard planning drill.

You line up product specs and benefits, market size and customer acquisition costs, and create a tangled web of how you get from a product capability to a customer base. The narrower the customer focus, the crisper the message and the easier it is to target that market. The broader the target, the mushier the value prop becomes while the abstract value of the market increases. The balance between market size and acquisition cost and viability are the rules of that game.

Honestly, I worry little about projected market size and more about tangible customer connections.

Size matters surely–it just matters a lot less. It’s an abstraction not a goal.

This niche approach focuses on core market questions without interference or ambiguity:

Who are you and what do you have to offer?

The value chain is crisp and clear as there are fewer moving pieces.

You need to create the environment to discover what the core behavior is that binds your product value to customer desire.

How will you get found?

This is a natural search, keyword and category-centric based approach.

Search, direct and referrals are the funnel. This is not a revelation certainly but if these pieces are out of whack, the formula is broken somewhere.

Stripping everything away, putting aside gaming search and focusing on the ‘why’ will open the discussion of ‘how’.

What’s your true expertise and value?

Information is everywhere. Finding context to attach your needs to useful information in language you can understand is the kicker.

From healthcare. Legal questions. Travel. Diet. Exercise. Love even.

You personally don’t need to be the expert. Expertise may simply exist at the community level. Ask yourself what it is that your customers get from being at your site, in your community?

This is your customers bullshit filter. Authentic passion is the product of the niche marketplace. Knowledge and relevance are the language you communicate in.

No niche is an island.

Who are your natural partners?

There is interconnect between niches. Sometimes they are extensions of your product. Think about niche sports manufacturers invariably partnering with clothing and nutrition companies. They often end up developing their own branded products.

This raises the partnership discussion. Who can you partner with? Who will become your channel? Where is the best marketplace for your traffic?

On the web, proximity is not an issue.

Connections that matter are. Referrals that broaden your network are key.

In building the market for your product, there are no formulas. No boilerplates for success. No definitive lists of to-dos. But there are useful ideas that surface interesting questions that provide guidelines that help figure this all out.

I’m drawn to this niche approach to market making as one of the best.

Think large. Focus small…is my way of thinking about this.

It’s a minimal viable product approach but for the barest, most essential touchpoint. User value, customer wonderment or sometimes just pure fun is that connection to capture.

Find that for one customer and you’ve got a great start and a direction to find the next one.

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If you have examples of niche communities that are doing something right or just something interesting, please share in the comments.