For business owners, what is social commerce?
Until recently, it’s been a marketing channel. It’s a collection of 3rd party platforms you visit to to find and speak to your target audience, hoping to get them off social media and onto your own platforms – your website, your email list, your SMS list, etc.
But over the last few years, that’s been changing. The rise of social commerce means that more and more social platforms are becoming selling solutions all by themselves.
Today, you can advertise, capture leads, sell to those leads, and then sell again without ever having to leave your social profile. You can run an entire business on Facebook. No website. No plugins. No SaaS apps. Just Facebook. And other social channels aren’t far behind.
Social commerce is revolutionizing how e commerce works, and today, we’re going to give you unparalleled look into existing social commerce solutions and how businesses just like yours are using them to drive massive growth.
Let’s get started.
What Is Social Commerce?
Social commerce or “S-eCommerce” is a new model for online retail that uses social networks to drive sales.
For instance, customers can compare products on Facebook, then make a purchase directly through the platform, rather than visiting the retailer’s website. Alternatively, a link or “buy button” could automatically transport a customer to the checkout page of a store.
A rising breed of “social shoppers” visit social networks every day as part of their shopping behavior. Savvy companies are now using that habit to drive consumer relationships and actual conversions.
Social Commerce Statistics & Trends
E Marketer reports that eCommerce sales in the U.S. will rise to $491.5 billion by next year (2018). As eCommerce and social media rise side-by-side, retailers and social networks have partnered to offer retailers a more convenient shopping experience. According to Gartner, 74% of consumers already use social networks to guide their purchases, and the worldwide social commerce spend hit $1,183 billion in 2016.
On average, modern customers spend $1,800 on social shopping per year. As social media becomes a more natural part of the buying funnel, more customers are looking for ways to review, research, and buy products through their favorite platforms. In fact, 73% of people who have used social buying buttons would be happy to do so again.
Though the social commerce landscape is constantly evolving, most trends point towards a desire to build relationships between customers and retailers, while simplifying the buying process. By offering an instant solution to purchase products where customers already spend their time, social commerce removes friction from the sales funnel.
As the importance of online relationships continues to grow for commerce, there’s a huge opportunity for businesses to use social commerce in adapting how customers feel about their brand. Moz discovered that 67% of customers are impacted by online reviews, and social platforms are a natural space to share testimonials.
In a world where consumer testimonials are 157% more impactful than the average advertisement, social commerce offers marketers and companies a chance to overcome the competition in the saturated marketplace, and improve the all-important trust levels between themselves, and their target market.
If brands can learn how to use social commerce properly, by choosing the right platforms for their target audience, then they could benefit from a more engaged, and loyal customer base. Approximately 56% of all customers who follow brands on social media claim that they do so to view their products and offers.
Social Commerce Via Facebook
Facebook is one of the most popular social commerce platforms, inspiring two-thirds of all social media visits to Shopify pages. Shopify also found that Facebook has the highest conversion rate of all social commerce platforms, at 1.85%.
When customers want to purchase from Facebook, they can click on the “buy now” button, provided by the company to by directed straight to an e-commerce website.
Alternatively, the platform has also introduced a “native” buying function that allows brands to sell products directly through Facebook. Companies can place photos, prices, and articles into a separate section, just like in an eCommerce platform.
Shopify revealed a case study from MVMT Watches, a company looking to simplify their path to purchase with social media. The Facebook store was quickly launched, leading to visits from 1,500 new customers within a 7-day period. That number rose to 60,000 visitors over 90 days and provided a 0.5% conversion rate which offered $15,000 in revenue.
Importantly, the man behind the MVMT watches Facebook commerce efforts noted that the company did have an ad budget that would have limited the conversions they could access. However, the brand believes that Facebook is just the beginning of the social commerce journey for MVMT watches.
Social Commerce Via Pinterest
87% of “Pinners” (Pinterest users) claim that they’ve purchased something they saw on Pinterest. Additionally, 93% of Pinners use their Pinterest accounts to make or plan purchases. This makes Pinterest a highly attractive platform for eCommerce companies. The platform can influence future purchases for customers in the consideration phase.
Pinterest customers are most driven by social commerce solutions that are “useful”, “inspiring”, and “helpful”. When browsing products on Pinterest, customers can choose to either “visit” the store, “follow” them on Pinterest, “Pin” the item for later (or create a board of items they’re interested in), or “Buy it” immediately.
Sephora, a beauty products brand, were looking to increase their online engagement with social media. The business researched their Pinterest analytics and realized that preferred beauty products appeared frequently on “Pinned” boards. Their clients were researching products and saving them to buy later. This inspired the brand to add the “Pin it” button to all the listed products on their website.
Sephora followed this strategy with a campaign called “Sephora color wash”, which encouraged users to search their websites for treasures they could “pin”. The campaign generated more than 14,000 pins and increased traffic by 60% for the brand.
Social Commerce Via Instagram
Hootsuite reports that 75% of Instagram users take desired actions, such as visiting a website or making a purchase after seeing an advertising post. Instagram is now following the Facebook “pay-to-play” format, making it a viable social commerce platform for brands that want to increase ad revenue and engagement.
Businesses can use Instagram to create video ads, photo ads, or carousel ads based on their budget and goals. However, it’s best to offer a native experience, as customers on Instagram prefer a seamless shopping environment. This need for a seamless experience is why Instagram now offers “Shop Now”, or “Install Now” buttons.
“Framebridge” believed that Instagram was the perfect platform to advertise their bespoke framing service. Their goal through Instagram advertising was to increase brand awareness while developing a loyal customer base. To help them achieve this outcome, Framebridge ran a targeted campaign on different audiences, grouped together based on important moments and events, such as marriage or buying a new house.
The company believed that targeting customers by “events”, helped them to find clients ready to frame something. Because they were looking at people who already had a problem they could solve, they increased their chances of sales. The campaign led to a cost acquirement decrease of approximately 71%.
Social Commerce Via Twitter
With Twitter social commerce, brands can make sales within the platform, while interacting with their target audience in real-time. For instance, a sponsored tweet may feature the “buy now” button, and use geographic targeting to reach local audiences.
Another strategy companies can use is to relate sponsored tweets to event-based hashtags or keywords that offer limited-time discounts or special prices for merchandise. This helps to create the effect of “scarcity” which might prompt customers to buy immediately, rather than hold on until later. Twitter’s “buy now” button also works for retargeting campaigns, delivering ads to visitors who are already primed for sales.
@iClothing is an Irish eCommerce company that sells clothing and footwear across Europe. The company is young, and vibrant, which may be why they chose Twitter as their selling platform. 42% of Twitter users are 15-17 years old, while 32% are 18-29 years old.
iClothing partnered with Wolfgang Digital to create a campaign with two tweet engagement offers around the hashtags #iWear, and #iWant. These custom hashtags increased interactions among current followers, and develop a wider consumer base. The result was a 25% larger peak engagement rate for the brand, which ultimately led to higher numbers of sales.
Social Commerce Via Snapchat
Snapchat is still breaking into social commerce with features like “deep linking”, and “auto fill”. Deep linking allows marketing agencies to engage in interactive “direct response” ads, where customers can tap or swipe to view product details and visit item pages. AlternativeLY, auto-fill allows customers to fill payment information fields automatically.
In April 2016, Snapchat launched the first “shoppable” ad with Lancôme, where customers could swipe to go to the mobile product page. The ten-second ads allowed users to swipe down to purchase or swipe up for more information. This process, similar to other social commerce solutions, offers a “native” environment through which social shoppers can learn more about products.
One way for companies to boost engagement and purchasing through Snapchat, and increase opportunities for purchasing, is with custom geo-filters. Snapchat analytics shows how often a target market views a geo-filter, which offers more accountable marketing practices. Great Lakes, an apparel store focusing on US pride, generated 22,000 impressions from a $35 geo-filter, which allowed them to target customers already engaged by a 15% discount. The result was a 12% conversion rate.
Snapchat is ideal for promoting flash sales. Because the Great Lakes audience had already committed to viewing the geo-filter, they only needed a small nudge to encourage them to make the most of their pre-issued discount coupons.
What Works & What Doesn’t?
The case studies above indicate that customers are looking for an authentic, natural experience when interacting with brands through social media. A well-executed plan for social commerce can take profits and visibility to the next level, while a bad one can do significant damage. Here’s a quick summary of how to make social commerce work for you.
What Works: Using Reviews
Research by BrightLocal found that 88% of consumers trust online reviews as much as they would a personal recommendation. Companies can place customer reviews on your website, open a forum for reviews through social media, while drawing attention to testimonials in social commerce. They can also use social commerce as a solution to build brand authority, developing trust among customers.
What Doesn’t: Not Knowing Your Audience
As the Framebridge case study showed, it’s crucial to know your audience if you want to increase your chances of sales on social commerce. Learning what your customers are looking for, and when you can target them in the sales funnel for the best results, is crucial to getting more from your campaign.
What Works: Simplifying the Purchase Experience
People today are busy, and the quicker you can make the buying experience, the better. By using a geo-filter, MVMT watches simplified the sales process by using a native Facebook page to sell their products. They also made sure that customers were ready to buy by providing plenty of information on their sales page.
What Doesn’t: Complicating the Buying Experience
In the case of Snapchat, customers can choose to either buy a product immediately or learn more about the item. The same is true for social commerce solutions like Pinterest and Facebook. It’s important to give customers not only a simple solution to buy but an option for research too, depending on where they are in the sales funnel. For instance, Sephora allowed customers to “pin” interesting items for later.
What Works: Knowing How to Present Your Product
Knowing how, and where to present your product is key for social commerce. For instance, iClothing was looking for younger customers, so they chose Twitter for their marketing platform, a space that appeals to a younger demographic. Similarly, Great Lakes knew that Snapchat takes advantage of the “Scarcity” concept for marketing, and used that to push customers into using discount codes.
What Doesn’t: Forgetting Research
As with any social media campaign, success for social commerce depends entirely on your understanding of your audience, and the platform you’re using. Learning how you can use each platform to appeal to the right target market could be the difference between higher sales and engagement, and wasted marketing budgets.
Social commerce is changing the game, and there’s still time to be an early adopter. We hope you’ve found today’s breakdown of social commerce information and helpful.
Are you currently using social commerce for your business? Do you have plans to use certain platforms in the future? Let us know in the comments.