Social media is playing an increasingly important role in overall commerce. Made for engagement and connectivity, social platforms like Facebook first started out as hub for people to come together and share with one another. When you distil the activity of socialization down to its component parts consumption plays a huge role, and always has, as evidenced in the impact that social media is having on overall commerce. According to Socialnomics, 93% of consumers turn to social media to make a purchasing decision, and with people spending 80% of their non-work related online time being social it makes sense for retailers to leverage this opportunity.
Social media networks precipitate reciprocity, a social psychological concept that essentially refers to responding to a positive reaction with another positive reaction. If we apply this concept to your customer’s social media profiles we can then make the assumption that online engagement between consumers and the relationships that they are building online go well beyond communication, action, reaction, etc., to include transaction.
As brands and retailers have been migrating online, they are also slowly building their social commerce strategies to align with the shift in online engagement and consumption. For some companies social strategies have fallen to the wayside due to budget and time constraints, but the facts show that social commerce is a profitable investment with some of the top platforms driving sales for online merchants.
More so than any other channel online, social media is driving huge increases in retail traffic. What brands need to start doing is executing beyond just engagement targets, and actually leveraging social for sales. Online clothing retailer Asos , have been able to get more sophisticated by analyzing the success of the their social campaigns. By taking something as simple as using a hashtag on Twitter to promote a contest helped Asos increase engagement. Other brands have used social platforms to create communities for their customers, where feedback and questions are encouraged, owning their brand conversations. Even in-store, luxury retailers like Nordstrom are leveraging social commerce by displaying items that are labelled as “Popular on Pinterest“. Social platforms allow retailers the ability to host mass media campaigns by tying together the same messaging across accounts.
Social commerce is even going as far as transforming our perception of social media, as homes for businesses, and these networks are working in turn to facilitate this.
How Social Networks are Bringing Together Socializing and Shopping
With 1.5 billion active monthly users, Facebook’s charge to lead the social commerce space comes as no surprise. In recent months the network implemented multiple new features to integrate eCommerce with its platform. Currently Facebook is driving two-thirds of mobile eCommerce traffic, reflecting the important role that social media plays in the digital retail universe. Some of these key features include Canvas ads that allow for a more immersive experience on mobile for user, and the Shop tab facilitated by Shopify for its sellers, which that displays items for sale under Facebook’s Pages for merchants.
Shopify launched a similar service offered in partnership with Twitter for its merchants, allowing them to directly sell products on the platform. This “Buy Now” button is available to Shopify merchants on Twitter in the U.S. Shopify also formed a partnership with Pinterest to allow Canadian merchants using Pinterest to drive traffic and sales with buyable pins.
Online luxury fashion retailer Net-a-Porter took it upon themselves to develop a shopping app call The Net Set, which allows both brands and consumers to upload content that’s available to purchase. The app works around the issue retailers face in selling through social platforms, that consumers want to go to an eCommerce site to browse and buy rather than buy directly off of a sPolyvoreocial site. Net-A-Porter’s Director of Social Commerce asserts that social platforms will need to partner with an eCommerce company to build a viable venue for transactions between merchants and consumers.
Billions of internet users have some sort of social account, making the market for social commerce massive for retailers. Shopify recently analyzed data across their merchants to determine just how social is impacting the eCommerce industry, and whether popular platforms are revenue drivers for online merchants. Here’s some of their findings including other research based on social commerce performance recently:
Facebook leads in social traffic and sales
85% of eCommerce orders for Shopify merchants from social media comes from Facebook.
Fashion aggregator Polyvore generates the highest order value, followed by Instagram and Pinterest
87% of Pinterest’s 100 million users made a purchase after seeing a product they liked on the platform.
Pinterest drives 16% of social commerce
Facebook accounts for 50% of social referrals
The top 500 retailers earned $3.3 billion online from social shopping in 2014
What Does this Mean for You?
Obviously, no two businesses are the same. What works on social media for one retailer, might not generate the same results for your business. Your target customer might not even be on social media, and if they are they might not be looking to purchase a product/service like yours on a social platform (B2B I’m looking at you). However, if you find yourself a B2C SMB on Shopify or Magento, looking to increase traffic and sales social commerce could help with your business needs. Experiment and remember to always test against specific goals.