Influence of Social Media in Retail

PART 3 – The Growth of Social Commerce

SERIES B

Over the last couple of years, how retailers and consumers use social media has evolved significantly.

This year’s surge in online shopping is here to stay, especially given the hurdles presented by the COVID-19 pandemic. The closure of brick-and-mortar stores, investments in e-commerce, analytics and social listening technologies by retailers, and an increase in use of Social media has only fastened the shift in buying habits.?Nearly 40% of customers have shifted to shopping online for things they would normally buy in-store in 2020.

Social commerce is on the rise. Last year alone, we have saw a surge in individuals and brands selling products and services on Instagram, partnership between TikTok and Shopify, introduction of Facebook Shops and Snapchat introducing Native Stores for brands and Whatsapp for business.

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Social commerce?provides offers shoppers an even more seamless way to shop online. It allows the consumers to make purchases directly from the social media app or site, instead of clicking through to a third-party website. Sellers have the potential to reach a wider global audience on these platforms. One can create collections of featured products, as well as modify the look of their stores with banners, images, colours etc. The same online store can be accessed through multiple social media platforms once it is set up.?

Currently, categories such as fashion, jewellery, beauty and personal care have seen a surge in sales through these platforms.

The market share of Organized retail is expected to be around 25% in 2020-21. A large chunk of India’s retail market is still unorganized. The share of e-commerce in the overall market is only 5%. Social commerce in India is still small at only $1.5-2 billion but is expected to touch $16-20 billion over the next five years. Though currently in its infancy, social commerce has the potential to become mainstream with accelerated adoption and proliferation of new platforms and increase of sales in B & C towns.

A bunch of start-ups such as Dealshare , Shop101, Meesho, and Mall91 have also created a huge impact and are fighting out with the larger players to gain a market share.

Let’s discuss some of the key trends in Social Commerce in 2021:

·???????Selling Through Conversational Chatbots:

The dependency on having a person interact with a customer has been replaced with chatbots. The use of AI/ ML technologies. It can make suggestions depending upon the customers’ selections, share product visuals, and ask for human assistance if needed.?Consumers prefer to interact more with brands that are quick and precise in their responses, making the use of chatbots even more significant.?

·???????Collaborate with Micro-Influencers to Increase Reach.

Micro-influencers specifically have a greater audience engagement percentage, and people listen to what they have to say. Brands have been collaborating with influencers to boost the brand’s reach right from launching a new product, sharing reviews to generate sales and influence the customer on every stage of the customer journey. According to Instagram, Influencers of the platform influenced 87% of the people in their purchase decisions.

·???????Creating a Frictionless Experience for the users

Creating a seamless experience for the user has become crucial. The faster and simpler you make it to checkout, the better is your chance to earn revenue by providing your user with an enhanced experience, considering that the users’ attention span has gone down drastically.

·???????Social Commerce incorporated by Social Media Platforms.

Instagram Shopping, Snapchat, Facebook Shops, and?Pinterest Buyable Pins have all of upgraded their functionality to match with social commerce trends. These platforms are improving their AI/ML and AR functionalities to stand out amongst its competitors to increase their market share.?

·???????Live-Streaming to Engage & Sell More

Live streaming is becoming increasingly popular. Brands, Consultants and influencers are using it more and more to showcase new products, discuss trending topics, take interviews, share videos on product guides, cooking, new art forms etc. Live streaming gives the audiences a chance to have an authentic and interactive experience.?

·???????Using User-Generated Content (UGC) to build trust and increased sales

User-Generated Content is dominating user behaviour.?It is an authentic way to market the brand. It generates trust and engages the audience in an efficient manner. 90% of the users find UGC helpful while making their purchase decisions. Potential users look up to the existing users’ reviews and recommendations and get largely influenced by their experience with the brand.?Utilizing Content that displays the use of the product by your existing user can make a massive difference in how people perceive your brand.?

·???????TaggShop Gallery Link

It has been helping brands to drive traffic from social media platforms and boost sales by adding a shoppable gallery link in the profile description of the social media platform. It allows one to convert your social posts into shoppable feeds by creating a unique URL which can then be shared as a link on Facebook, Pinterest, Instagram, YouTube and other platforms to generate traffic, increase engagement and improved sales.?

Some of the key benefits of Social Commerce are:

1.?????Get in front of more potential customers

2.?????Increase reviews and recommendations

3.?????Improved Voice of Customer data to understand the customers’ social habits

4.?????Convert customers where they are

Summary

Social media continues to evolve. The phenomenal growth in e-commerce has created opportunities for brands to invest more and improve their social commerce experiences. It allows brands to create frictionless shopping experiences and reach consumers directly and more effectively. However, to succeed, marketers must have a clear strategy and utilize the right channels to connect with their target audience.?Established channels, including Pinterest, Snapchat, Facebook and Instagram are good and ready platforms to start with.