The Rise of Social Commerce
Social networks have come a long way from the simple days of connecting and communicating with friends. Over the past few years we have watched the likes of Twitter and Facebook develop into content promotion platforms as marketers, advertisers and brands push to drive users to conversions through engaging and clever content.
This has always been a process that involved the user clicking through to an external site to complete the action, but that has always left marketers asking themselves one of the most frustrating questions: how do we truly measure ROI on social? Well this seemingly unanswerable question may be about to be answered as social networks have begun to fully immerse themselves in social media, all with the help of a simple ‘buy’ button and here we have the rise of social commerce.
What is “social commerce”?
The term ‘social commerce’ is one that we’re increasingly seeing as social networks take on the role of selling for your favourite brands. Acting in the same style as an ecommerce site, social channels take on the role of placing orders and processing payments, cutting out the need for users to click through to an external site to complete the transaction.
Barely a week goes by without an update from one of the social giants in an arms race to reach social commerce success, so we’ve rounded up the latest.
Facebook broke social media records and caused quite a stir this year by generating higher referral traffic for content publishers than Google for the first time. It’s no secret that Facebook is becoming quite the social media powerhouse with competitive ad rates and deals with the world’s biggest media publishers, but now it is about to introduce shoppable pages thanks to collaboration with Shopify. The term ‘Facebook Commerce’ has even begun to pop up. Watch this space as your Facebook feed begins to emerge with product pages from all your favourite brands. But does the word ‘intrusive’ spring to mind? There are already rumblings of discontent.
It’s not been the best year for Twitter, with a drop in share price and the failure to gain the mass increases in users its competitors have enjoyed. This is not exactly encouraging to brands looking to invest in the social channel as part of their marketing strategy. Whilst Twitter is working and trialling a ‘buy’ button, it has also rolled out ‘product collections’ with description, price and the option to buy, book or visit the site for more information.
This is currently being trialled on a small number of accounts. These lack on-site checkout but do show what other users are tweeting about them and therefore help provide reviews for users. However, this format seems slightly out of place on Twitter, a place where users come to keep up to date with what is going on around the world or share what they ate for dinner – not buy a pair of trainers.
Back in 2012, Bizrate announced that 70% of users out of their respondent online shopper survey used Pinterest to get inspiration on what to buy, while only 17% used Facebook to seek inspiration. Since then, Pinterest has introduced buyable pins. The network has the advantage of being a visually strong network where users come to seek ideas for anything from cooking to fashion to home décor. Providing the option to purchase what they have been looking at gives Pinterest the edge other social networks don’t have when it comes to social commerce. It isn’t a case of products being pushed at them, it’s a case of users having the ability to buy what they’ve already been seeking, thus making it feel much less intrusive, and probably even useful (at least until brands start spamming the service). Could this be a more successful story than Facebook and Twitter?
Instagram is the dark horse in the social commerce race. With no option to post links with images, the only form of ecommerce functionality was brands resorting to ‘like to buy’ style sites outside of Instagram. This made Instagram seem an unlikely form for revenue generation for brands. However with the introduction of a call to action button in ads, Instagram has upped the stakes in social commerce success. In September 2015 Instagram hit 400 million users, surpassing Twitter’s 300 million user base, and is predicted to power ad revenues to $1.48 billion in 2016 and $2.81 billion by 2017. With the option to ‘shop now’, ‘install now’, ’sign up’ and ‘learn more’, Instagram is one to watch, particularly as all users have no choice but to experience these ads on their feed. Currently there is no in-app checkout like Facebook, Twitter and Pinterest are aiming to achieve.
Would you buy from social media? We found out
Social networks’ primary function is to provide a method of communication, but does this mean users will want to purchase during social hours? The likes of Facebook are constantly transforming ways in which adverts can reach its users; there is even talk of adverts in messenger from brand to consumer. But this could become too invasive for users.
However, even if social commerce is a hit, it doesn’t mean it will be the same rule for all social channels. As highlighted, Pinterest provides directly what users want to see. The blend of commerce will appear natural within the existing format, just with the addition of a buy button. Whereas with Facebook, the pushing of products on a network primarily used for socialising with friends could run the risk of coming across as intrusive.
PushON ran a social survey questioning whether users would be happy to buy from social media, and there will be an in-depth post on the subject shortly. However, an early result suggested that 17% of respondents felt social media marketing is intrusive and social media should just be place for them to socialise with friends.
Trust in brands also plays a huge role in users’ confidence in social media. 50% of our respondents admitted they would feel more confident buying from a brand’s site than on social media. One respondent explained that they didn’t believe a social network could provide enough information around a product to encourage the purchasing decision that an ecommerce site could. This is an interesting point. High street apparel may succeed due to needing minimum information, but larger purchases such as technology, home furnishings and holidays require vast amounts of information and planning before the consumer makes the decision of purchase. Can the likes of Facebook or Twitter really help drive those big decisions or will it just be too much distance between brand and consumer?
One to watch
These days so much goes into ecommerce success for retailers. From flowing and creative websites to well designed and produced supporting content around services or products teamed with a strong marketing campaign. By social networks stepping in as ecommerce platforms, is it drawing brands too far away from the purchase process for customers?
The same applies to customers. Will they trust social networks when shopping for brands, or is it a case of social networks immersing into an area consumers aren’t ready for? Social commerce will definitely be one to rise, but could it fall?
We’ll be looking into the subject as we analyse the results of the survey and observe the rapidly changing market.