Social commerce refers to using social media platforms to facilitate buying and selling goods and services. This can include features such as built-in shopping carts, buy buttons, and direct links to eCommerce sites.
Social commerce has become increasingly important in today’s eCommerce landscape as more consumers use social media to research and make purchase decisions. Social media platforms allow businesses to connect with their customers and build brand loyalty through engaging content and personalized shopping experiences. Additionally, social proof, such as customer reviews and ratings, can influence purchasing decisions.
Rise of Social Commerce
Social media has transformed into a marketplace for businesses to sell their products and services. Platforms like Instagram, Facebook, and TikTok have built-in shopping features that allow users to purchase products directly from the app. This has led to a shift in consumer behavior towards making purchases directly on social media platforms. The convenience of being able to purchase products without leaving the app and the influence of social proof has resulted in more and more consumers making purchases through social media.
Social commerce has had a significant impact on traditional eCommerce. It has created a new sales channel for businesses and changed how consumers shop. Traditional eCommerce companies have had to adapt by integrating social media into their sales strategy to stay competitive.
Live commerce is a newer trend that has been gaining popularity in which businesses use live streaming platforms such as TikTok, Instagram, or Facebook Live to showcase and sell their products in real time. Consumers can interact with the host, ask questions, and purchase directly in the live stream. Brands are now factoring in budgets for influencer marketing more and more.
Brands in omnichannel retail want to have a consistent and seamless customer experience across all channels, whether online, in-store or on social media. This allows customers to have a cohesive experience and make purchases seamlessly regardless of their channel.
AR/VR technology is also being integrated into social commerce, enabling customers to virtually try on products, explore virtual showrooms, and create personalized shopping experiences. This technology has the potential to enhance the customer experience further and drive sales on social media platforms.
Also, read:
Types of Social Commerce
Social commerce can be further classified under the following five categories:
- Social Shopping involves using social media platforms to buy and sell products directly. Examples include Facebook Marketplace and Instagram Shopping.
- Social Media Advertising: Using social media platforms to advertise products and drive sales. This includes sponsored posts, influencer marketing, and product placement.
- User-Generated Content: This type of social commerce involves customers sharing product reviews, testimonials, and photos on social media. This content can be used to drive sales and increase brand awareness.
- Community Building: Building a community around a brand or product on social media. This can include creating a Facebook group or hosting a Twitter chat.
- Social Listening: Using social media platforms to listen to customer feedback and track conversations about a brand or product. This can help businesses improve their products and customer service.
Popular Social Commerce Platforms
Popular social commerce platforms include:
- Instagram Shopping: Allows businesses to tag products in their posts and stories, linking them to product pages where customers can make a purchase.
- Facebook Marketplace: A platform where individuals and businesses can buy and sell goods and services.
- TikTok Shop: It allows businesses to create shoppable videos where customers can purchase products directly from the video.
- Pinterest: Allows businesses to create shoppable pins where customers can purchase products directly from the platform.
- WeChat: A Chinese social media platform that allows businesses to create official accounts and sell products through the platform.
In terms of features and capabilities, all these platforms allow businesses to sell products and connect with customers. Instagram Shopping and TikTok allow businesses to create shoppable videos, whereas Facebook Marketplace, Pinterest, and WeChat allow businesses to create official accounts and sell products directly on the platform.
7 Strategies for Success in Social Commerce
- Utilize social media platforms: Leverage the power of social media platforms such as Facebook, Instagram, and TikTok to connect with potential customers and build a loyal following.
- Build a strong brand identity: Develop a strong brand identity and consistent messaging across all social media channels to establish customer trust and credibility.
- Create engaging content: Create engaging and shareable content that resonates with your target audiences, such as video tutorials, user-generated content, and influencer partnerships.
- Leverage customer reviews: Leverage customer reviews and testimonials to build trust and credibility with potential customers.
- Use social commerce tools: Use social commerce tools such as Instagram shopping, Facebook shops, and TikTok shoppable videos to make it easy for customers to purchase directly from social media.
- Utilize Influencer Marketing: Partner with influencers in your niche to expand your reach and drive sales.
- Monitor and respond to social media feedback: Monitor and respond to social media feedback promptly and professionally to build a positive reputation and foster customer loyalty.
Also, read:
Live Commerce
Live commerce, also known as live streaming commerce, is a subcategory of social commerce in which a live stream is used to showcase and sell products in real time. This approach allows businesses to create a more interactive and engaging shopping experience, build stronger customer relationships, and increase sales.
Platforms and tools for live commerce include live streaming platforms such as YouTube Live, Facebook Live, and Instagram Live, as well as e-commerce platforms with integrated live streaming capabilities, such as Shopify Live, BigCommerce Live, and Alibaba Live.
Examples of companies successfully implementing live commerce include beauty brand Sephora, which uses live streaming to showcase makeup tutorials and product demonstrations, and furniture retailer Wayfair, which uses live streaming to showcase furniture in real-life settings and allow customers to ask questions in real time.
Potential challenges for live commerce include the need for a reliable internet connection and equipment, the need for skilled hosts or presenters, and managing customer interactions and questions during the live stream effectively. Solutions for these challenges include investing in high-quality equipment and internet service, training hosts or presenters on live-streaming best practices and using tools such as chatbots or customer service representatives to manage customer interactions during the live stream.
Social Commerce and Omnichannel Retail
Omnichannel retail refers to a seamless and integrated approach to retailing across multiple channels, such as brick-and-mortar stores, online marketplaces, and mobile apps. Omnichannel retail aims to provide customers with a consistent and cohesive shopping experience, regardless of how they engage with a brand.
The importance of social commerce lies in the fact that it enables retailers to reach and engage customers across multiple platforms and touchpoints. This is particularly important when customers increasingly turn to social media to discover and shop for products. Omnichannel retail allows retailers to capitalize on this trend by providing a seamless shopping experience that spans social media, e-commerce, and physical stores.
Potential challenges for omnichannel retail include the need for significant investments in technology and logistics and the need to coordinate and align operations across multiple channels. Solutions to these challenges include leveraging data and analytics to optimize operations, investing in technologies such as artificial intelligence and machine learning to improve personalization and automation, and fostering a culture of collaboration and innovation within the organization.
Attribution Challenges in Social Commerce
Tracking attribution in social commerce refers to the process of identifying and assigning credit to different marketing channels or touchpoints that lead to a conversion or sale. It is important for businesses to understand which channels drive the most revenue and allocate their marketing budget accordingly.
There are several methods for tracking marketing attribution, including last-click attribution, first-click attribution, linear attribution, and time decay attribution. Each method has its own set of strengths and weaknesses, so businesses may need to experiment to find the best fit for their specific needs.
Identifying and measuring profitability in social commerce can be challenging as well. Businesses need to consider factors such as customer acquisition costs, lifetime value, and return on investment when evaluating the profitability of different channels or campaigns.
A data warehouse can help solve these challenges by centralizing and storing large amounts of data from various sources, making tracking, and analyzing attribution and profitability metrics easier.
This data can include information from social media platforms, e-commerce systems, customer relationship management (CRM) systems, and more. Businesses can gain a unified view of their data by using a data warehouse to track and analyze customer behavior, marketing performance, and other key metrics.
By using a data warehouse and business intelligence tools, businesses can gain a more complete view of their social commerce performance and make more informed decisions about their marketing strategies.
Another benefit of using a data warehouse is the ability to combine data from different sources. For example, businesses can combine data from their social media platforms with data from their e-commerce systems to track customer behavior across different touchpoints. This can help businesses identify the most effective marketing channels and strategies.
Data warehousing can also help businesses to overcome challenges such as data silos, inconsistent data formats, and data inconsistencies. These are common issues when working with data from multiple sources, but a data warehouse enables normalizing the data and making it usable for reporting and analytics.
Also, read:
Conclusion
At Saras Analytics, we understand the importance of tracking attribution and profitability in social commerce and have the expertise to help businesses do so. Our data warehousing and business intelligence solutions can help businesses centralize and analyze their data, allowing them to track and optimize their marketing efforts and grow their eCommerce business. Contact us today to learn more about how we can help you track and grow your eCommerce brand.
