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According to a report published by Adweek on Social Commerce, “The top 500 retailers online brought in a total revenue of nearly $6.5 billion through social shopping.” One of the biggest changes and opportunities that e-commerce has for 2020 is social commerce.
Social commerce offers a huge opportunity for retailers to improve revenue. It is essential for brands to understand what social commerce is and how it may affect their operations in the coming years.
What is social commerce?
Social commerce, also known as social shopping, is an area where e-commerce and social media meet. It is a way of allowing brands to streamline the buying process for their customers and improve the efficacy of their social media ads.
Social shopping has been around for a long time now. Both brands and social networking platforms have been working hard to find a way to convert social media into sales platforms. In the E-commerce Trends report published by BigCommerce, “30% of consumers say that they will buy from social media platforms like Twitter, Instagram, Pinterest, and Snapchat.
Social commerce usually describes the entirety of e-commerce within social media. However, it is really more of an umbrella term for different types of content which is helping brands to sell on social media. Some of the different types of social media commerce are:
- User-generated content reviewing products on various e-commerce sites
- Product reviews on social media
- Ads on social media with call-to-action buttons
- Buy buttons on social walls
- Peer-to-peer buying and selling
- Transferring payment for a product without leaving the social media network
Social commerce features
There are a few different features that social media platforms use to enable social commerce. Each social media platform has a unique approach to social commerce which brands can capitalise on.
The most popular social commerce feature is the “Buy Now” button. Platforms like Twitter, Facebook, Pinterest, and Instagram have this call-to-action button available and, brands can add it to their posts or ads. Usually, the button links the users to the brands’ website in order to complete the sale.
Social commerce plugins and apps
There are third-party plugins and apps available that brands can use if social commerce is still not available. A good example is a third-party app known as Soldsie. This app works with Instagram and Facebook and it allows users to buy by commenting the word ‘Sold’ on a post. Once the user has commented, the app will take care of the rest by emailing the customer an invoice to confirm the order or complete the sale. Other social commerce apps that you can try out are commentsold, social selling, and jumper.ai.
Shop on posts and stories
This is a relatively new social shopping trend and platforms such as Snapchat and Instagram have recently launched their versions. Brands can now be tagged within posts or stories which allows buyers to shop for a specific item. Through posts and stories, brands have created a way to advertise without too much friction, as well as enabling a seamless customer experience within a social media platform.
Social media’s role in buying behaviour
Social media plays a major role in the buying habits of customers – even without social commerce. For example, social media recommendations and online reviews can influence the choices of buyers. According to a study by Pew Research Center in 2016, 82% of Americans check out online reviews or recommendations before purchasing. This behaviour has even been given the name ‘ROPO effect’ by marketers, which stands for “Research Online, Purchase Offline”.
Social media encourages desires
Social media posts create demand because social media browsers and users are constantly exposed to many different products. For example, looking at a fashion blogger’s Instagram may create a desire to buy more shoes. Similarly, a post about an interior designer may encourage users to renovate a space in their home. Social commerce is effective because it drives traffic and changes shopping behaviour at the same time. According to the same research from Pew, “Up to 15% of Americans buy products or services after they follow a link via social media.”
Biggest social media platforms for social commerce
Instagram – Shoppable tags
Instagram introduced ‘tag photo’ in 2016 which allows creators to tag products within their photos. These tag posts have a “tap to review” button which reveals the products and their prices. When a tag is tapped, a detailed view of the product will pop up. Tapping on the tagged items brings the users to the brands’ website. Stickers can also be added to Instagram stories to make it a social shopping experience.
On Instagram, users will not complete the purchase on the social media platform. Instead, they are taken to the website with just a few taps. Whilst the completion of the purchase is moved to the website, Instagram has found a clever way to connect discovery and purchase – by allowing users to know more about the product before making a decision. It is likely in 2020 that consumers will be able to directly purchase their products on Instagram as the platform has been experimenting with offering a fully transactional ecommerce experience to brands and customers on the platform.
To set up a brands’ social shopping account on Instagram the following should be completed:
Create an Instagram for Business account.
- The account should be connected to a Facebook catalogue which can be set up from a Facebook page or through Facebook Business Manager.
- Allow Instagram to review your account before Instagram shopping can be set up.
Pinterest – Best social commerce platform
Pinterest is built on visual content which makes it the best place for items such as home décor, DIY, fashion, crafting and more. The platform allows users to buy the products that they are viewing in just a few short steps.
Rich Pins – Pinterest’s Rich Pins provide additional information to users. There are different types of rich pins including, product pins, article pins, recipe pins and app pins. Rich pins feed extra information directly from the site that it is pinned from. Users need to add metadata (description) on their website and validate the page in order to enable Pinterest’s Rich Pin.
For product pins, Pinterest allows users to add pricing and stock information. This makes it even easier to update information. A tap on a pin will lead users directly to the brand’s website.
Facebook – Convenient social commerce
Facebook has always been an expert in creating targeted marketing options. The platform features a combination of buy buttons on ads, which makes it a great place to improve social commerce strategies.
Facebook Marketplace is geared less toward brands but, instead, allows users to buy and sell used items. With the help of Facebook groups, many local groups that are dedicated to exchanged goods have flourished. Facebook Marketplace provides a powerful search filter which allows users to find items by price, category, location and relevancy.
Why is social commerce important?
Social commerce has effectively deviated the way brands use social media in order to connect with their customers. Instead of generating awareness and directing traffic to the site, social commerce enables the brand to sell directly to customers within their social feeds. It reduces the purchase journey to two simple steps and will increasingly allow users to view and buy the product within the platform.
Since most purchase journeys are suffering from decreasing performance across the purchase funnel (people may click but not be able to load the brand’s site for example), which can lead to major losses. Social commerce enables brands to streamline their purchase journey ad reduce sales funnel leaks by reducing the steps that a consumer has to go through.
Standing out among increasing competition is also a major problem for many brands. Ad costs are always increasing and the constant changes in search engine and social media algorithms can easily de-prioritise content. Major brands like Marvel have found a way to stand out by encouraging users to engage with their ads. Through engagement, reach is increased as well as improved impression results on, posts and ads. This makes social commerce an amazing tool for increasing both sales and engagement.
Example of effective social commerce – Adidas on Snapchat
Adidas was the first brand to launch a product via a Snapchat Show with integrated social media commerce support. As a result, Adidas sold out on its new style in just hours by letting viewers swipe up their phone screens to buy the pre-release of the sneaker. This demonstrates the power of social commerce in generating exclusive offers which appeal to loyal customers of a brand.
Is your brand ready for social commerce?
Most consumers today are happy to buy products through social media platforms. Brands should now be looking at creating a scalable strategy to jump into social commerce. Instead of settling for the occasional sale on social media, consider how followers can be turned into consistent and loyal customers.