Heads Up, Local Businesses: Social Commerce is on the Rise
Major retailers and small businesses alike understand that a strong social media presence is an investment. Cultivating positive buzz and getting out ahead of trends through shares and likes used to be enough, but now companies are confronted with converting browsing into engagement and engagement into a click on a “Buy Now” button. Nevertheless, whatever the social platform, and whatever the social commerce strategy, good copy, professionally produced photography and video and compelling narratives still drive interactions more than technology, no matter how glitzy or slick.
The good news for companies is that e-commerce through social media platforms such as Facebook, Pinterest, Twitter and Instagram continues to grow. According to a recent report issued by Business Insider, customers purchased more than $3 billion worth of merchandise via social sites in 2014. While social commerce still only accounts for less than 2 percent of all revenue by referral channel — by comparison, paid advertising still drives more than 15 percent — trends point to an overall decline in the effectiveness of marketing as the Internet has known it. Multiple studies show that, taken globally, mobile purchases, whether made in-app or via social sites, now account for 50 percent of all e-commerce sales. By and large, mobile commerce is social commerce.
Still, social commerce remains something of an experiment. Standards are few and far between, and marketing professionals would be wise to remember how quickly the landscape can change. Each social media platform relies upon its own functionality and offers its own customer experience. As you weigh the social commerce options available to you, consider the following:
The more seamless the experience, the more attractive it is to potential customers
One of the strengths of Facebook’s social commerce API (powered by Shopify) is that the entire transaction is handled within Facebook. Users who click to buy from a Page post or advertisement are never redirected from Facebook, and they never have to backtrack to Facebook from a third-party website after having made a purchase. Pinterest’s “Buyable Pins” similarly emphasize convenience. The more the social commerce solution disrupts the user’s native app experience, the more likely users will view it not as a convenience but as a nuisance. Twitter’s recent announcement that it will be partnering with online payment processor Stripe to streamline its “Buy Now” protocols is evidence that earlier social commerce implementations on that platform were too cumbersome.
Data, data, data
Some platforms, such as Facebook, prioritize insights and offer the necessary resources for measuring the effectiveness of social campaigns. Other platforms, such as YouTube and its TrueView in-stream ads, simply allow advertisers to link to their existing e-commerce storefront. Tracking and targeting (by location or interest, for example) options usually come at a premium, but if they’re deal-breakers for your business, know how far your marketing dollar is actually able to go.
Each platform is a niche market defined by its own unique demography
The overwhelming majority of active Pinterest users are women. If your company is selling products or services traditionally marketed to women, Pinterest may be the ideal platform for you. (At the moment, Buyable Pins are only available to select retailers and businesses, so be sure to get on the wait list if you’re interested in signing up). Likewise, Facebook continues to skew older. Twitter, on the other hand, casts a smaller net, capturing only 23 percent of adult Internet users, but tends to trend younger and more urban when it comes to its core user base. Marketers also need to take into account Twitter’s product and place pages, which it’s currently testing with a select group of users.
The message matters
Maintaining a social media presence has always been about more than dressing up traditional promotional efforts as public outreach. The promise of social media is that it can drive engagements that don’t always require ad expenditures. So, for example, even if your business cannot take advantage of Instagram’s recently released sponsored content feature, you can still issue calls-to-action in which conversions play an important role. One of the criticisms of Instagram’s recent rollout of its social commerce solution is that it’s only available to paid advertisers. Great content has a way of selling itself on social media, especially if that creative solution delivers an appealing message in a format that’s fresh or encourages redistribution.