“I don’t use social media.” The chances of you hearing this statement are very bleak, especially if you belong to a developed or developing country. Facebook, Instagram, Twitter, Linkedin, Tiktok, etc., are becoming household names now.
Marketers or advertisers use these platforms for different advertising or marketing campaigns. Similarly, consumers use these platforms for social interactions, entertainment, search for trends, etc. But, have you ever noticed, you often see a product on your Facebook newsfeed with the option “shop now” or “buy now.” Yes, that’s a feature that allows users to buy a product from these platforms.
In business terms, we call it Social Commerce. A new term, right? Well, keep on reading it if you want to learn some fascinating facts about social commerce.
What Is Social Commerce?
Social commerce, in simplest words, means direct purchasing/buying and selling goods and services on a social media platform. The word “direct” is important in this context because the whole buying/selling process takes place on the same platform. Consumers/customers search for a product and complete the purchase process without leaving the app/platform.
Generally, the buyer has to pay via two methods:
- Pay online through debit/credit/visa cards/Google Pay, etc., or
- Cash on delivery (depends on the brand’s policy).
Social commerce is gaining rapid popularity, especially when it comes to trusted brands. According to a survey, consumers are more willing to buy from a brand with which they had a positive experience on social media rather than buying from a competitor.
Moreover, in accordance with the current trends, 8 out of 10 sellers are expected to sell their products via social media platforms in the next three years.
Back in November 2020, social commerce had a whopping $89.4 billion market, and the projected growth is $604.5 billion in the next 6-7 years.
How Social Commerce Started
The traces of social commerce go back to 2007, and Facebook happens to be the pioneer. By 2014, users were able to buy products on Facebook through a buy button. Moreover, the first shoppable ad was launched on Facebook in 2015. Finally, Facebook launched its specific “Facebook Marketplace” in 2018 to compete against Amazon, Etsy, eBay, and others.
Instagram was the second social media platform that joined the Social commerce industry. Although it started a bit late, the platform has a lot of potential for social commerce due to two major reasons:
- High-quality and amazing images and videos make things more engaging for buyers.
- The majority of Instagram users consist of youth who are more enthusiastic about online shopping.
Social Commerce Vs. Ecommerce
Technically there is not much difference between these two because both of them are internet-oriented marketplaces.
Ecommerce is a marketplace where customers buy products from dedicated websites or apps of different brands.
On the contrary, in social commerce, the purchase process completely takes place on specific social media platforms such as Instagram, Facebook, Pinterest, etc.
Benefits of Social Commerce
Social commerce has been yielding a lot of opportunities and benefits to businesses; here are some of them:
- Audience Grows Consistently. There are more than one billion active users on Facebook, and the user base keeps expanding every hour. Pinterest, Instagram, and other platforms have similar stories. These platforms help businesses to grow their audience consistently. All they need to do is use these platforms effectively; they must know how and whom to sell.
- Customers Facilitation. There is a famous marketing approach, “meet your customers where they are.” Social media usage has increased immensely over the past few years. Customers spend a significant amount of time on social media platforms. With that being said, social commerce is a perfect way to meet your customers where they are.
- Two-Way Communication. Social commerce is a two-way communication marketplace. Customers can easily interact with the brands before making a purchase and inquire about everything related to the product. Similarly, it is easier for customers to give feedback or lodge a complaint.
- Suitable for Changing Customer Preferences. Customer preferences have changed significantly, especially during this pandemic. Three-quarters of consumers in the United States have changed their shopping preferences during this pandemic. Moreover, 40 percent of them prefer brands that are suitable for their digital shopping habits. Also, 50 percent of those consumers are switching to social media to learn about new brands. Therefore, social commerce is going to be a massive marketplace in the near future.
- Better Search Engine Ranking. Social commerce is not just about the sale/purchase; it helps businesses to attract more traffic to their websites as well. Ultimately, it helps businesses to achieve better rankings on search engines.
- Customer Retention and Customer Loyalty. A brand simply cannot succeed in social commerce if it fails to satisfy its customers. Bad reviews can literally ruin a brand’s reputation. Therefore, brands using social commerce not only sell high-quality products but also aim to build good relationships with customers. Customer satisfaction leads to customer retention and loyalty.
Top Social Commerce Platforms
Currently, there are four social media platforms offering this social commerce feature.
You can say that Facebook shops are a better or more advanced version of Facebook pages. Brands use Facebook pages to connect with their audience, promote their products or services, and communicate with them.
However, Facebook shops are customizable. You can choose which products you want to sell and select the colors, images, or fonts that suit your brand. You can also import your product catalog from your website or create a new one. Moreover, you can access your Facebook shop from your Instagram profile, Instagram shopping ads, or your Facebook Page. Apart from that, there are other wonderful business features offered by Facebook shops.
It might be hard to believe for you, but 60 percent of people discover new products through Instagram. The best thing about Instagram shops is that customers can buy products featured in your videos and photos from anywhere in the app.
However, it is mandatory to set up a Facebook shop first before you set up your Instagram shop. Your Instagram shop will automatically fetch data from your FB catalog.
Instagram shops have so many wonderful business features, but here are some important things you should know.
- You should be living in an eligible region to set up your Instagram shop.
- You must have an Instagram Business account connected to your Facebook page.
- A seller must comply with Instagram’s merchant agreement and commerce policies.
- Instagram shops can only sell products. That said, you cannot sell services on Instagram shop.
Alright, honestly, Pinterest doesn’t typically offer social commerce features. That said, a business account on Pinterest can create “product pins” which you can display in your brand’s Pinterest shop.
However, the notable thing is that you cannot shop/buy that product within the app. Once you click on the product, the app will direct you to an eCommerce website for completing the purchase.
Snapchat, in July 2020, made an announcement about a closed beta launch of Brand Profiles. Those profiles had a specific feature, the “Native store” experience that was powered by Shopify. That feature enables users to purchase from the app.
Initially, they started offering this feature through five officially approved influencer accounts on Snapchat, including Spencer Pratt, Shay Mitchell, Kim Kardashian, Kylie Jenner, and Bhad Bhabie. However, several other brands have gained approval to use this feature, and it will be available to every brand soon.
Social Commerce Examples
Some brands have simply aced it when it comes to social commerce. Here are some of them
Au Revoir Cinderella- Let Your Followers Be Your Billboards
They say, “Deeds speak louder than words,” Au Revoir Cinderella is one of those brands whose products speak LOUDER. This brand uses User Generated Content (UGC) and post customers’ images and videos rather than using self-made images on their products page.
J. Crew- Fan’s Feedback is Gold
Well, this may not be a typical Social Commerce campaign, but it surely is a great one. The importance of customer feedback is always a vital aspect for potential customers to know about a brand. According to a survey, 93 percent of customers say that online reviews impact their purchase decision significantly. That is why J.Crew shares its customers’ feedback at the front and center of its product pages to make the purchase decision easier for potential customers.
Sephora- Create an Experience Rather Than Creating Simple Content
Consumers mostly lookout for recommendations for a unique shopping experience. This rule applies to eCommerce and in-store transactions. Therefore, if a brand can personalize the shopping experience for its customers, it will be a plus.
For instance, Sephora’s “Fragrance IQ” quiz is a great example of social commerce. The quiz consists of different questions (in a certain order) that help the brand in determining the best suitable colognes or perfumers for the buyer.
Tips to Increase Sales on Social Media
Facts and benefits related to social commerce can be very mouth-watering, but you still need to do well if you want to get going. Here are some important tips to increase your sales on social media.
Know your audience
Reposting content from your website won’t do you any good if you are selling on social media platforms. You have to choose your products and messages according to your audience on the platform. Gather as much information as possible such as demographic data, customer preferences, etc., and position your products accordingly.
Let’s say you sell male clothing for all age groups, and you have added all products to your website’s catalog. However, most of your Facebook followers are teens or adults in their 20s. Now, it will be unwise to put too much focus on products for oldies.
Remove any Obstacle in Purchase Process
What can be the possible obstacles to a smooth purchase process?
- Insufficient product description
- Adding a very limited number of payment methods
- Not integrating autofill options into the purchase process
- Not responding to the queries timely
Make sure you don’t make these or similar mistakes.
Engage With Your Audience
Don’t just toss your product catalog and wait for things to happen. You have to engage with your audience by answering their questions, offering valuable content, and try to be authentic. Facilitate them at all fronts.
Encourage Customer Reviews/Feedback
As mentioned earlier, customer reviews or feedback is a vital trigger for potential customers. Great reviews always motivate the potential buyers to make the purchase decision. Encourage your customers to share honest and constructive reviews/feedback.