June 24, 2021
Social commerce broke through during the pandemic – and brands need to be paying attention
As part of our deep dive into all things Mobile, Stephen Warrington, global vice-president of e-commerce and retail at Jellyfish, explains why brands need to make their e-commerce strategy social today, not tomorrow.
Before the Covid-19 pandemic, shoots of commerce functions had already started to appear on the likes of Facebook, Instagram and Snapchat. But, for one reason or another, social media platforms didn’t have a permanent seat at the e-commerce table.
Fast forward 18 months and that’s all changed. Between the potent mix of changing consumer habits because of the pandemic and the fast-tracked digital transformation of the retail sector, one thing is clear: social commerce is very much here to remain.
Brands and retailers are already much more comfortable experimenting with new platforms and are now investing their media money in broadening their roster of sales channels. What’s more, in their own right, social media companies are establishing themselves as retailers – and with revenue expected to reach $600bn in the next six years, why wouldn’t they want a piece of the pie?
In a changing retail landscape, social commerce offers brands extremely accessible routes to market and a different experience than a typical direct-to-consumer offering. Potentially, social commerce will become the only sell route for some brands, which is why businesses must react now to avoid being left behind.
Brands can’t afford to ignore social commerce
Social media is a fantastic avenue to interact with customers and receive instant feedback on products and offers. For that reason alone, it is a critical area that brands must be involved in. Irrespective of the commerce side, social platforms should be utilized to improve operations, understand customer opinion and adapt to upcoming trends.
Historically, older demographic groups have not shown an interest in newer social platforms. But in the US, around 20% of 30–49-year-olds have a TikTok account, while that figure stands at 14% for those aged between 50-64; an almost negligible difference. Because the audience is there, brands and retailers can’t afford not to be.
In addition, purchase journeys on social media can be substantially shortened from those taking place elsewhere online and in store. If this happens, purchasing behavior will speed up in much the same way – scroll the timeline, select the item and then purchase the item – as there is less opportunity for customers to become distracted with competitor advertisements, avoiding users purchasing from different brands.
As social commerce matures, the different tools and functions available will also evolve and the buying journey will only become more efficient and more foolproof.
Social media has a plethora of innovative tools available
As social media platforms look for different revenue models to compete with larger e-commerce sites, creating an engaging experience for customers will be vital. Fortunately for brands and retailers who are a little green when it comes to digital, there are already a plethora of different innovative functions available to them for very little cost, particularly on Instagram, TikTok and Snapchat.
Augmented reality (AR), for instance, is a key technology brands can utilize through virtual try-ons and product visualization. A Deloitte study reported that 71% of customers would be encouraged to shop more frequently with the use of AR experiences. Additionally, the increasing prominence of 5G phones makes AR a far more compelling touchpoint for customers, as it enables AR to become ubiquitous. This is a key area that brands – like Hoka One One did with their virtual pop-up store – can take advantage of to bridge the gap between the physical store and online, while simultaneously boosting engagement and combining e-commerce features to increase sales revenue.
Other features, such as Instagram Drops, are also great ways for brands to create noise around upcoming products and campaigns. The Drops feature centralizes product launches, making it easier for consumers to browse, shop and purchase.
With that, Live Shopping is an interesting space with high degrees of purchase intent, and is rich in valuable data and customer insights via analytics such as conversion rates and social amplification. This will act as a real mindset shift versus a relatively static website, which in this route to market morphs into a live televisual trading platform.
What’s next for social media and retail?
Retail, like many other industries, has been altered by the pandemic, and institutions are having to react to changing consumer habits. While this is new territory, social commerce is great for retailers. Brands, through social shopping, have an opportunity to increase sales by developing a digital strategy that creates a unique experience for consumers across the different platforms.
However, striking the right balance is key, and organizations need to align on the uniqueness of their brand across the different platforms. Brand message, no matter the platform, must be consistent, and that includes the different associated e-commerce functions. Not all functions will suit a brand’s personality, so selecting which platform and functions amplify that persona best will be the key to a successful social commerce strategy.
The experiences of the last 18 months have proven that brands are more willing to test new platforms and the benefits of digital. Social commerce has offered retailers a route to market that businesses cannot ignore – forecasted growth expected to be 28.4% from 2021 to 2028 – and will therefore be key to their commerce approach.
Original article: The Drum