One way to understand social commerce is to imagine the traditional, time-honored informercial or home shopping channel. Picture those ads on social media; now your marketing is on overdrive. Add efficient and established payment ready website and fulfillment services into the mix, and you have a retail shopping experience that is predicted to revolutionize the way people shop and who they shop with. In 2021, $37 billion in goods and services were purchased through social-commerce channels in the US. By 2025, that figure is expected to swell to nearly $80 billion, or five percent of total US ecommerce.
Social commerce allows for an interactive and dynamic form of shopping that creates an engaging journey created to remove barriers between seller and shopper. Social media platforms become channels for retailers and brands to form deep connections through social commerce features like livestreaming, live chat, virtual shops, and augmented reality (AR).
For many retailers, two methods for attracting and growing a customer base have proven most effective: creating compelling experiences that draw interest and promoting brands through influencers – both of which can be accomplished through social commerce.
How important is social commerce for retailers today?
Fortunately for many retailers, having a strong social commerce presence adoption has been slower than predicted due to data security concerns, lack of trust in the retailer, and lack of faith in the customer service provided by unfamiliar ecommerce sites.
Tomorrow? There’s no denying social commerce will be a game changer, especially for retailers who already place a prime importance on gaining the trust of their customer and creating an experience that puts the shopper in control. There’s too much money to be made, too many easy avenues for anyone – from entrepreneur to megabrand – to achieve spectacular results, and too many shoppers who, over the next few years, will not buy products any other way. A 2022 McKinsey survey of US consumers who have participated in a social commerce event found that 75 percent want to attend more live-shopping shows in the future.
Social commerce gives small and medium brands the same opportunities to sell their products through the same platforms used by the big brands. Size is not a determining factor in giving today’s shoppers the control when deciding who they want to follow and where they want to buy. It’s up to the ecommerce retailer to devise ways to develop or transition existing SEO and ecommerce practices to optimize keywords, hashtags, alt-text, and location tags to get found and create accessible content.
Shoppers today are using social networks to search for information, recommendations, verifications and personalized suggestions throughout their purchasing journey. In China, where social commerce retail has taken control, brands have achieved conversion rates of almost 30 percent on social platforms, a result up to ten times higher than conversion in conventional ecommerce. Social commerce retailers have developed marketing strategies to make it easy for audiences to find them through SEO searches on the social commerce platform they prefer. Data still plays a large role, but the relationship is centered around the customer, engaging them in the moment, and building trust that the brand will deliver what it promises.
What is the future of social commerce
If the experts are to be believed, and the data backs them up, social commerce will be a major driver for all retail sales in the future. The information technology company, Accenture, projects that social ecommerce will grow into a $1.2 trillion retail channel by 2025.
In many respects social commerce is radically different than other mortar-and-brick retail and ecommerce, but it’s not an entirely new world. SEO, video, and AR will still have impact, only now it can also be integrated social commerce content strategies.
Social media rewards creativity and intelligent brand positioning. Influencers will play an important role, and the enthusiasm of their followers can be every bit as important as their numbers, especially for brands with small budgets. Micro-influencers, those with fewer than 5,000 followers and affordable for most brands, consistently have the highest engagement rates. They are viewed as more authentic by audiences and have devoted and dependable followers. In 2020, micro-influencers achieved a five percent engagement rate compared with just 1.6% for those with a million or more followers.
Trust will continue to be a determining factor in relationships. Shoppers want the confidence that what they see is what they get. When AR is included in the experience, and customers can virtually ‘try on’ cosmetics and merchandise or see 3D models of goods, their satisfaction increases. According to an EclipseGroup study, 71 percent of respondents said they would shop more often if they could use AR.
3 Steps for Growing Social Commerce Revenue
Brands should seek out marketing partners that understand the evolving social commerce marketplace and can help them seize opportunities to tie in the development of a comprehensive social ad strategy to attract new followers to the brand and social commerce site. With the proper strategies in place, and the most effective social SEO and social ad deployment, Reputation matters and your audience’s opinion begins the moment they can into contact with your brand so it’s important you make a good one from the start. Here are a few tips.
1) Put trust and customer first
It can be so easy to start generating income with social commerce that many enterprises take shortcuts when it comes to customer satisfaction. That is a big mistake. The complete user experience, especially in areas where the relationship continues after the sale has been made, is what matters to your customer. Reliable and efficient order fulfillment makes a difference. Prompt customer service and return policies build trust. Screw-ups happen, but if you’re prepared to quickly respond you’ll increase the chances that your shopper returns.
2) Make the experience easy
Use effective search strategies that make sure your social commerce site is found. Focus on keyword search terms and follow best practices like hashtags and SEO. Once you have your customer engaged, it should also be simple for shoppers to add items to their carts through intuitive buying features. From a business standpoint, a seamless purchasing and efficient fulfillment partner saves social commerce businesses time, worry, and helps control costs.
3) Make every experience memorable
The social ecommerce experience is where the retail playing field gets leveled. Two of China’s top live-streamers, Li Jiaqi and Viya, sold $3 billion worth of products in only one day. It’s even more remarkable that their one-day total was more than three times the behemoth Amazon’s average daily sales. Shoppers crave the excitement of participating in live events, chats, augmented reality and other immersive and interactive social commerce engagements. According to Khoros, 73 percent of consumers say they are willing to pay more for a product if they love the brand.
Now is the time for retailers to seize the opportunities offered by social commerce if they are avoid risking irrelevance and letting other, innovative competitors take the lead. Those that understand their customers and can create a community of loyal shoppers established on trust will prosper in a future when social retail commerce drives sales.