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What Is Social Commerce? Why Brands & Marketers Need To Pay Attention

May 15, 2024
Agency News , Industry Trends , Technology

Explore the rise of social commerce, distinct from e-commerce, and its transformative impact on retail, including projections for the burgeoning livestreaming market.

What Is Social Commerce? Why Brands & Marketers Need To Pay Attention

Social commerce, the integration of shopping functionalities into social media platforms, has emerged as a game-changer in the digital retail landscape. With the potential to revolutionize how businesses connect with consumers and drive sales, it’s a trend that demands attention from brands and marketers alike.

A recent article from Shopify highlights the expansive growth of social commerce, projecting retail earnings to reach nearly $80 billion by 2025 in the US alone. This growth is fueled by the increasing number of social media users, currently standing at 4.89 billion worldwide. With such a vast audience, social commerce presents an unparalleled opportunity for brands to expand their reach and engage with potential customers directly on their preferred social platforms.

But why is social commerce gaining traction? According to data from eMarketer, the average social media user now spends approximately 2 hours and 26 minutes per day across an average of 6 social media apps. These platforms have evolved beyond mere social networking hubs—they’ve become virtual marketplaces where consumers discover, research, and purchase products seamlessly.

Case in point: TikTok, the rising star of social commerce, boasts a user base that rivals Instagram’s and offers native shopping features to facilitate in-app purchases. Brands like HABIT have seen remarkable success by leveraging TikTok’s advertising capabilities to reach a global audience and drive sales.

Facebook, a veteran in the social commerce arena, remains a dominant force with its robust suite of e-commerce tools, including Facebook Shops and Marketplace. According to TechTarget, Facebook is the platform of choice for 89% of marketers leveraging social commerce to drive retail sales. The platform’s ability to create customizable storefronts and facilitate seamless transactions within the app makes it an indispensable tool for brands looking to capitalize on social selling.

Instagram, another powerhouse in the social commerce space, boasts over 1 billion active users, with 70% of shoppers using the platform to discover new products. Through features like Instagram Shops and shoppable tags, brands can showcase their products in a visually compelling manner and drive purchase decisions directly from the platform.

Pinterest, often overlooked but highly influential, has become a go-to destination for product discovery, with over 465 million monthly users. Brands like Allbirds have tapped into Pinterest’s vast user base by leveraging shoppable product pins to reach affluent consumers with disposable income.

The Rise of Livestreaming in Social Commerce

Looking ahead, one of the most exciting developments in social commerce is the projected surge in livestreaming. According to Retail TouchPoints, the livestream shopping market is expected to be worth $35 billion in the US by 2024. This growth can be attributed to the immersive and interactive nature of livestreaming, which allows brands to connect with consumers in real-time and showcase products in a more engaging manner.

Livestreaming commerce, popularized in China and gaining traction globally, combines influencer marketing with live video broadcasts to create a dynamic shopping experience. Brands like Sephora and Nike have already experimented with livestreaming events to launch new products and engage with their audience in a more personal and interactive way.

As livestreaming becomes more mainstream, we can expect to see brands investing heavily in this channel to drive sales and foster deeper connections with consumers. By leveraging the power of livestreaming, brands can humanize their marketing efforts, provide real-time product demonstrations, and create a sense of urgency that encourages immediate purchase decisions.

In conclusion, social commerce isn’t just the future of retail—it’s the present. Brands and marketers need to adapt to this new paradigm to stay competitive in an increasingly digital world. By harnessing the power of social commerce and embracing emerging trends like livestreaming, businesses can unlock a world of opportunities and thrive in the ever-evolving landscape of e-commerce.