Social commerce – a crucial development for e-commerce

As businesses prepare their strategies to move forward in 2022, they should consider the impact of key social commerce trends.

Social commerce is a crucial development for e-commerce. Social commerce is turning e-commerce into in-app purchases.

Before social commerce, brands generated product awareness and community-building on social media to drive traffic to a third party such as a Shopify site or an Amazon store. With social commerce, brands can now grow their audience and sell to them on one platform. So now each click counts.

Consumers and businesses are adopting social commerce very rapidly. According to Ecommerce Times, that marketplace will reach $3 billion by the end of 2028, with a steady increase of social buyers in the U.S. from 32.5 percent in 2021 to 37.9 percent in 2025.

Social platforms will continue to be the primary place for consumers to follow and engage with brands. Today even B2B manufacturers are taking notice.

Social media will be the advertising and buying platform. Both social commerce and social media are enjoying explosive growth and e-commerce sales are expected to increase at a healthy clip.

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Social commerce, e-commerce, and social media are not all the same.

The biggest difference between social commerce and e-commerce is how buyers and sellers interact with one another and the level of influence involved. Social commerce is a subset of e-commerce that involves social media and online media to support social interaction. E-commerce is the act of buying and selling goods, products, or services over the internet.

But the two channels have similarities as well.  They have a convergence point on the internet. Each strives to create a seamless experience. Neither should be viewed as separate exploratory channels. They both are complementary to executing, fulfilling, and achieving omnichannel commerce strategies and increasing revenue. They both also increase customer trust and loyalty.

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Brands must figure out how social commerce aligns with the behavior of their audience.

As social commerce and social media converge, brands may not thrive using one channel without the other.

If a brand has an established presence on social media, but with no online store set up, then will this audience actually buy from them through social media?

If a brand has an established e-commerce website, but no social media presence, then can they grow by generating awareness and traffic from social media?

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Influencer marketing is the new “It” thing. As social network usage grows across various industries, brands spend more on social media and leverage key influencers to connect with audiences and share their messaging.

Brands are no longer just throwing money around and seeing if it works. They are demanding results and ROI from the influencers they select.

Content will remain king. The content will always be what gets shoppers’ attention.

Brands must explore the different social platforms to understand the best way to connect with users. For instance, TikTok is all about video. LinkedIn is great for sharing information across B2B channels. Facebook is about community and connection. Twitter is the on-demand news channel.

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Moreover, virtual goods are of rapidly growing interest worldwide. The metaverse is taking center stage. Consumers have never been keener on acquiring digital assets. Retailers must watch for it and act on it.

Cryptocurrencies and non fungible tokens (NFT) are digital assets recorded on the blockchain. Unlike traditional forms of currency, NFTs are interchangeable because each token has a unique value. Such transactions are expected to go mainstream.

Meanwhile, supply chain challenges and inflation are impacting businesses that sell physical goods.

There is an opportunity for most types of businesses. Fashion brands can market digital clothing items, lifestyle companies can venture into selling artworks, and content producers can monetize premium content.

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3Q Digital’s 2022 Social Commerce Report reveals that

• Most brands were investing in social commerce through Facebook-owned properties. Other platforms like Snapchat seemed to have better success at achieving overarching marketing objectives.
• All respondents regardless of industry agreed that social commerce would continue to grow in importance, along with investment in subsequent quarters.

Social commerce in the U.S. is still in its early stages, and each industry has unique reasons for investing in it.