“Social media is rapidly evolving into a way to generate new revenue,” says company president Hugo H. Ottolenghi. “Smart companies are cashing in on their online efforts.”

Social commerce is the newest and most dynamic growth area of the Internet today. Sales through social commerce are expected to grow in the United States from $1 billion this year to $14 billion in 2015, according to Booz and Co., a global consulting firm.

“Large numbers of people will choose and buy their products and services using social media,” says Ottolenghi. “Savvy businesses and professionals can gain customers and clients in ways and numbers they could never before.”

Until now, social media were effective in building brand awareness such as “Likes” on Facebook and generating leads through online bargains. Now, businesses and professionals can use social media to generate revenue and build customer loyalty.

“Imagine what would happen if you put your best customers with potential new customers in your store or office,” Ottolenghi says. “With social commerce, that occurs online and sales take place on the spot.”

Social commerce moves individuals and businesses from being fans to customers making repeat purchases, Ottolenghi says. Those customers can also be cross-sold complementary goods and services.

“The dynamics of social commerce are changing the way people making buying decisions,” Ottolenghi said. “In the real world, we ask a friend for a recommendation for a good doctor, lawyer or restaurant. The same is now starting to happen in the online world where the numbers – and the revenue potential – are much, much greater.”

Twitter works faster and better than any news service. Word gets out and is passed along to millions of people while a reporter is still collecting information. Twitter does much less well at delivering ads because that real-time strength pushes paid messages off screens at a rapid rate.

To address that weakness and move closer to social commerce, Twitter has launched a pilot program to give fixed prominence to Tweeted ads, called Promoted Tweets.

For example, if the Acme Co. is launches a BOGO offer at midnight with a Promoted Tweet, that message will still be still be near or at the top of the Twitter list when the consumer logs in that morning, noon or night.

Better value for the advertiser? Maybe. Twitter can say that it delivered 100 percent of paid Tweets because all users will have seen them.

Does that translate into more revenue? That has more to do with the quality of the message. If the offer has value or is clever enough to attract attention, then people will click on the link.

If the offer goes viral, it will be re-Tweeted, which again is a measure of the quality of the message, not how many people saw it the first time. A free Re-Tweet is also a better deal for the advertiser than a Promoted Tweet.

Right now, Twitter is tweaking the program with select clients such as Groupon, JetBlue, LivingSocial, Microsoft Xbox, Red Bull, Sephora and Starbucks. They are likely to promote limited-time offers that can be passed along.

How well would those and other companies do using their Twitter account to reach core customers and ask them to get the word out?

USA Today reports that “cardholders who link their account through a special app on AmEx’s Facebook page will receive discounts and special offers based on their listed interests and ‘Likes,’ as well as the interests and ‘Likes’ of their Facebook friends.”

By connecting what friends like with what people buy, American Express joins a growing group of companies that recognize that commerce is going social. People are purchasing goods and services based on what they like and what their friends like.

Whole Foods Market, Outback Steakhouse and Celebrity Cruises are among the 100 or so businesses that have joined the AmEx program, reports USA Today.

“We want to help merchants go social,” Ed Gilligan, vice chairman of American Express, told USA Today.

Has your business gone social? Would it be a good fit for the AmEx program? If you haven’t asked yourself those questions, why not?

Of all the online coupon websites, Yelp is making the best use of social media to generate revenue for its listed businesses and for itself.

That’s important to know when your business is solicited to offer a one-day deal by one of the growing number of social commerce websites.

Groupon and LivingSocial have created niches by recruiting businesses to offer discounted products and  services. They extensively market those offers over the Web and TV. Both make it easy for consumers to find local deals.

However, Groupon and LivingSocial are more like digital coupon books than anything else. They lack the social dimension of Yelp, which started as a consumer review site customized to the user’s location. Restaurants write-ups made up the bulk of the early listings.

In the past year, Yelp has solicited businesses to create specials and post them to their Yelp pages. Businesses design their offers and Yelp provides social media marketing tools such as Tweets and Facebook page updates.

By the way, if you haven’t read your Yelp page recently, do so. It could contain outdated or inaccurate information, such as that you are closed.

Yelp rises above Groupon and LivingSocial because customer ratings and comments drive the site traffic. Reviews range from praise (“Great food!”) to critical (“Overpriced drinks.”) to detailed information about products and customer service experiences.

The opinions help prospective customers decide if a coupon deal is right for them.  The fact that Yelp was started for consumers by consumers puts it ahead of the competitors, which solicit sellers, not buyers.

The firm has issued a report on how retailers and professionals are using social commerce to engage consumers. The study, conducted in May and June 2011, found that:

• Millennials (20 to 33 years of age) are interested in shopping on Facebook, more so than Gen Xers (34-46) or Baby Boomers (47-66). The big reason: They already spend a lot of time there and it’s convenient. Think back to the days when kids hung out in malls.

• To be accepted as a place to shop, Facebook needs to be considered safe. That means not only secured transactions, but limited sharing of personal information with third parties.

• Buyers want a personalized experience, with Millennials (51%) more likely to say this than Gen Xers (36%) or Boomers (21%).

The study results can be found at on JWTIntelligence.com.  Consider how they would apply to your business or profession. Is there an opportunity to create a new revenue stream by targeting younger people through social media?

Examples: Alvenda allows people to buy flowers from within the Facebook Fan Page of 1-800-Flowers. Similarly, Payvment allows consumers to buy from multiple businesses on Facebook using one shopping cart.

The process is as simple and safe as the major online stores with one big difference: People are telling others about their shopping experiences and about products and services.

The same happens in the real world; people recommend restaurants, retailers, doctors and lawyers to their friends. The shift to the online world is part of the evolution of business in the 21st Century.

The rise of social commerce is good news for investors in Facebook and Google and even better news for businesses and professionals that are first to hop on the trend.

Starcom MediaVest Group and Rubinson Partners, two leading marketing companies, report that Facebook now accounts for 4 in every 10 referrals on the Web. That’s far ahead of email at 17 percent of traffic and Twitter at 11 percent.

The study measured the sharing and clicking habits of the more than 300 million people who pass links with a ShareThis button on over 1 million websites.

The report, released in June 2011, found that the sharing of links accounts for 10 percent of all Internet traffic and about a third of all traffic to websites. Search engines account for almost all of the rest.

The study results show that companies and professional that don’t see a purpose to Facebook are missing out on a large opportunity to generate visits to their sites. The statistics also raise the question as to what’s more effective, traditional advertising or just getting the word out there for everyone to share.

In this environment, it’s essential that a business or professional firm get its news out using Web tools such as a news page, YouTube, blog and social media. Our firm can help you decide what to share with current and potential customers, when and how.

For more information, see our pages on email, blogs and social media