Online shopping has become social. Imagine you're scrolling through Instagram looking for something you like. You complete your purchase within the app and avoid having to visit a product landing page. Social commerce provides exactly this type of experience. This simplifies the purchase journey by removing extra steps and makes consumers more likely to complete their purchase.

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Thus, social commerce can be the key to success when using social media for retail. In this post, we'll take a deeper dive into what social commerce is and how your brand can make the most of it. To create a great Social Commerce experience, you need to remember the “social” part.
You can't just toss your catalog and forget it. Answer questions, offer value and interesting content, be human and authentic, etc. Set up a chatbot to help people move through their shopping journey through customer service.
The same best practices you typically use to engage your followers apply here too. Social commerce comes with integrated social proof in the form of user-generated content. Comments, likes, shares, and follows all help potential buyers trust your brand. When customers keep interacting with and promoting your brand, other social media users are more likely to trust your brand as well.

Table of Content

• What is social commerce?
• 5 Benefits of Social Commerce for Your Business
• 6 Social Commerce Statistics Marketers Should Know
• 3 social commerce trends for 2023
• social commerce industry statistics
• Social Commerce Trends for 2022 and 2023
• People engage with more AR experiences
• User-generated content to build trust with buyers
• Micro-influencers to help brands create authentic reach
• Use of AI-trained chatbots
• Live streaming to increase popularity
• Getting Started with a Social Commerce Strategy

What is social commerce :

The direct purchase and sale of goods and services through Social Media platforms are known as social commerce. This involves taking social media beyond its traditional role in the search process. Instead, users will get to complete their entire shopping journey on a single platform. This means they can go from search to purchase faster without leaving their favorite apps. Retailers can now use specialized social commerce tools from top social media networks. This includes platforms like Facebook, Instagram, Pinterest and TikTok. Using these tools, you can create a digital storefront within the respective platform itself. This way, people can use these storefronts to find and buy products without having to go to another website.

Social Commerce vs E-commerce : 
E-commerce broadly covers the process of buying and selling goods online. This includes selling through various digital channels, including online marketplaces, websites, and dedicated retailer apps. Meanwhile, social commerce involves selling directly through social media platforms. Since social media is an online channel, social commerce is a subset of e-commerce but it is not the same as ecommerce.

5 Benefits of Social Commerce for Your Business : 

Reach a wide audience of potential customers: Social media usage continues to grow, with over 4 billion people using it worldwide. Combine this with the fact that consumers are discovering new brands and products through social media. According to Sprout Social's Social Shopping in 2022 study, 40% of consumers were finding the right product through a brand's organic posts. Researching products on social media and seeing a friend's posts are other common ways consumers discover products. Convert customers where they are and remove friction: Social commerce makes it easier to convert customers right where they are because they can make purchases directly on the platform. This eliminates the need to switch to a different app or website to find the product they want to buy. Thus, it removes friction and barriers to purchase by shortening the shopping journey. Increase reviews and recommendations through social proof: If your business is new to selling online, social media is the perfect place to establish much-needed social proof. When shopping online, your buyers can't necessarily try or test your product. Reviews can be the key to making an educated purchasing decision. Managing your entire customer journey on social media creates a positive feedback loop. This will eventually affect your revenue.

Gather useful data on your customers' social habits: Social commerce features give you direct access to your customers' social profiles. This provides you with useful client information that you can utilize to improve your current approach. Combine these insights with social media listening to get an even better understanding of your audience. This way, you get even more comprehensive information about your customers' habits and interests. Earn additional revenue compared to traditional e-commerce: Social commerce is driving a large portion of marketing-driven revenue for e-commerce businesses. According to McKinsey, retail social commerce sales revenue in the US was $45.7 billion in 2022. Experts estimate that this number will reach close to $80 billion by 2025. Although this represents only about 5% of total retail e-commerce sales, it still represents increased revenue. Since social commerce opens up new ways to increase sales for your business, it allows you to increase your revenue.

Also Read : How Social Media Helps in Business Growth: A Descriptive Guide

6 Social Commerce Statistics Marketers Should Know : 

• The most widely used social commerce network is Facebook. An estimated 5 million users in the US are expected to shop on the platform in 2022.

• Instagram is in second place with an estimated 41 million buyers.

• TikTok is another popular option, with 23.7 million users making purchases on its platform.

• Pinterest attracts approximately 15.9 million social shoppers on the platform.

• Targeted advertising is the number one way for social shoppers to find the right product. Fifty-nine percent of people surveyed in the Sprout Shopping study were searching for products through these ads.

• Recommendations from friends are the biggest reason consumers make purchases on social media.

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3 Social Commerce Trends for 2024 : 

Many of the e-commerce trends we see today influence the trends shaping social commerce today.

• Livestream shopping will drive a significant portion of social media shopping. According to the Sprout study, 61% of consumers currently utilize this social commerce function. Additionally, 53% were planning to use it more.

• The social shopping experience will be improved by VR and AR activities. Platforms like Pinterest have also introduced a "Try On" feature powered by augmented reality. This allows shoppers to try out makeup products and see how home decor products look in their space.

• Inclusive marketing will be a major purchasing factor in social commerce. Sixty percent of shoppers in Sprout's social shopping study said inclusive marketing would make them more likely to purchase from a brand.

Social Commerce Industry Statistics : 

• Social commerce is booming as the use of social media increases. Research shows that the typical social media user now spends about 15% of their waking lives on social platforms, with 10% of American adults addicted to at least one app.

• Despite these worrying statistics, social commerce is not as big in the US as it is in other countries. About 30% of Internet users in the United States already make purchases directly within social platforms, but China is the clear global leader.

• China's borders are home to the most digital shoppers in the world, and purchases from those shoppers account for more than 50% of all retail sales. Also, according to eMarketer, almost half of Internet users in the country make purchases on social networks. More than ten times as much is sold in the US by those customers.

• International brands are picking up tips from Chinese retailers' social commerce tactics. So, what can we expect to see in the coming year? If “mastering social commerce” is on your agenda, here are four trends to keep in mind.

Social Commerce Trends for 2022 and 2023 : 

About 30% of Internet users in the United States already make purchases directly within social platforms, but China is the clear global leader.

China's borders are home to the most digital shoppers in the world, and purchases from those shoppers account for more than 50% of all retail sales. Also, according to eMarketer, almost half of Internet users in the country make purchases on social networks. More than ten times as much is sold in the US by those customers.

International brands are picking up tips from Chinese retailers' social commerce tactics. So, what can we expect to see in the coming year?

People engage with more AR experiences : 

AR and VR are entering the mainstream. In 2022, more than 25% of the US population will use AR, and about 20% will use VR.

In 2022, 16.6% of the US population will use AR through social networks. This figure will reach 19.8% by 2025.

Social media is a major driver of AR usage. People often first experience AR when they use filters or lenses on Snapchat, Instagram, or TikTok. Retailers can take advantage of this trend by using AR filters to showcase their products or allow customers to try them virtually.

For example, L'Oreal and Facebook recently announced a partnership to bring AR-fueled makeup try-ons for shopping on Instagram. Customers can visit the brand's Instagram page, find the product, and virtually try it on before purchasing.

Sue Young, head of Spark AR at Facebook, explains that using AR during the social commerce shopping journey has the potential to improve the customer experience. She says, "Try On AR is an exciting new effort within Facebook that is already helping people shop online with more confidence." “Through this new integration with L'Oréal, shoppers can expect a more personalized shopping experience from their favorite brands, right where they already find beauty inspiration: on Instagram.

Micro-influencers to help brands create authentic reach : 

Despite concerns that the pandemic would slow down influencer marketing, it has only fueled growth as people want relevant content. Influencer marketing is estimated to be worth $16.4 billion in 2022. Although working with micro-influencers is not a new trend, it is still relevant for 2023.

Smaller retail businesses in particular may find that working with micro-influencers stretches their marketing budget further while helping them connect with a larger segment of their target audience.

The benefit of influencer marketing lies in the fact that 61% of consumers trust recommendations from influencers – more than the 38% who trust branded (and often biased) social media content.

While big-name influencers with thousands or millions of followers may be out of reach for some growing retailers, micro-influencers typically work with brands on affordable budgets.

For example, Instagram influencers with less than 10,000 followers can charge $193 per sponsored post.

Engagement rates for micro-influencers are often much higher. Data from Hypauditor revealed that nano-influencers with less than 5,000 followers have the highest engagement rates (5%). This appears to be decreasing as the number of followers increases until reaching the celebrity level (1.6%)

User-generated content to build trust with buyers : 

Shoppable user-generated content (UGC) can provide the social proof that customers want to see before making an in-app purchase. When shopping online, buyers cannot physically experience an item. However authentic visuals created by customers can provide a view of what a product looks like in reality. 79 percent of people say that UGC strongly influences their purchasing decisions.

Often the most impactful content is not highly staged product images, but authentic user-generated images from real customers. The majority of consumers (56%) said that user-generated photos and videos are the content they most want to see from brands.

Online clothing boutique Lulus regularly posts photos of real people wearing its clothes on its Instagram feed. It promotes the branded hashtag #lovelulus in its bio as a way to inspire customers to use it in their posts.

In this UGC example, the brand tags the user and includes the hashtag to show browsers that the post was found through the hashtag.

Use of AI-trained chatbots : 

Forty-three percent of consumers say they are likely to use live chat in the next year. Shopify's Future of Commerce report found that 60% of shoppers think that an excellent customer service experience is a motivating factor in influencing their purchasing decisions. Another 54% say the ability to easily access customer service in the channel of their choice is important to them.

 Live streaming to increase popularity : 

Sixty percent of buyers say live streaming improves the shopping experience. Live commerce uses social media platforms to blend live streaming and commerce. Viewers watch Facebook Live (or equivalent) videos, communicate in real-time with a brand, and purchase items off the back of its responses. While the US is still in its early stages, live streams have created a stir in China. China's livestream sales market grew from $3 billion to $171 billion in three years.

McKinsey & Company says, "If China's experience is any guide, our analysis suggests that sales generated by live-commerce could account for 10 to 20 percent of all e-commerce by 2026.

Some US companies have partnered with mainstream social media platforms to further this trend, such as Sephora's Facebook collaboration. Others have created their channels outside of well-established platforms. For example, Nordstrom launched its live shopping channel.

Getting Started with a Social Commerce Strategy : 

Social media has revolutionized the way businesses and consumers interact and social commerce is the newest area of it. You now know all the basics about social commerce – from what you can benefit from to which platform you should use. So if you're ready to get started,

Social commerce takes advantage of the large number of people using social media platforms around the world. For example, 59% of US adults use Instagram daily and 38% of those daily visitors log in multiple times per day.This is a huge potential audience for brands to advertise to, far greater than any reach of television, radio and print advertising.

Social media users can discover and explore brands, products and services, add products to their shopping list or cart and complete checkout – all without leaving the social network.Social commerce can include the use of native shopping solutions (for example Facebook and Instagram shops) or eCommerce integration (for example browsing a product catalog and adding items to cart on a social media site, followed by finishing the online retail checkout process.

Heyday is an AI chatbot designed for retailers that links your social media accounts and online business together. It allows you to automate up to 80% of your customer support conversations. When customers reach out to you on social media with questions related to your inventory or order tracking, the chatbot assists them in real time (and sends more complex inquiries to your support team.

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