A peasant hotel owner’s blogging turns his once struggling business into a profitable one. A PC expert who also sells PC’s offers real, practical advice to buyers on his blog and on community sites and now his business is booming. Alibaba launches a record IPO making it the 2nd most valuable Internet company in China.

What do all of these stories have in common? Social commerce. Social commerce is the process of buyers and sellers establishing credibility and relationships through online communication.

In China, the relationships that fuel commerce in so many ways are moving online. It’s a lesson that Alibaba’s Taobao leverages for its users in its massively active BBS forums filled with buyers seeking advice from sellers. Post Bar and Zhidao have brought similar traffic and trust to the Baidu platform. eBay unfortunately did not learn the power of community in China soon enough before it exited the market. Google, with its investment in Tianya and launch of Laiba may be a faster learner. There are surely lessons for Facebook and Myspace here as well.

Summary
In March, a 40 years old farmer used a blog (integrated with mini SNS and video post) to promote his hotel. In about 6 months, around 3,000 tourists went to his hotel (not a small number for this small hotel). This turned the several years’ unprofitable situation to a 200,000RMB income. Now the hotel has its own website and the hostess plans to build more rooms for more tourists.

Sample Quote (link)
我们已经去过两次了,只因为好!真是一言难尽,我说什么都不管用,只要你体验了你就知道了!
We have been there twice only because it’s wonderful. Words cannot express. Only after you experience that, you will know.
我是9月去的您那!您合理的收费!热情的服务!合口的饭菜!还有让人挑话眼的娱乐项目!真是太好了!我庆幸自己去过!我更谢谢您们!
I went there in September. Your reasonable charges, warmhearted service, delicious food and nice entertainment are really very good! I’m happy that I have been there! Thank you very much!

Same as the hotel hostess, an offline PC seller built up a blog called “Lao Gao’s DIY Paradise”. He uses the blog and online community to share his professional information with others and sell PC related products. The professional information attracts many visitors to his blog. In less than 5 months, the total visits reached more than 160,000 and about 160 people registered on his website.

CIC View
More and more both consumers and individual sellers are realizing the importance and influence of IWOM. The success of these two common people largely rely on their good usage of IWOM and social media to promote their business and bring them lots of visitors. Therefore, while IWOM is offering more challenges, it also brings more commercial benefits.
If a company can use the social media and the IWOM carried out by their staffs or consumers properly, the promotion of its brand would be quicker and more efficient than any other traditional campaigns.

Below is a screen shot of the index for the full IWOM watch report

(click image to enlarge)

Other CIC IWOM Watch related posts that may be of interest:
CIC Watch Half-Year Review released (download the full report)
CIC watch: “You” – Time’s Person of the Year – also lives in China (download the full report)