Published on Apr 19, 2022
Updated on Jul 13, 2022
A year ago when the world was in the throes of a health crisis, social media served as an answer key in scenarios such as finding medicines, tracking the availability of hospital beds, and providing meals to the Covid patients. Social apps became a significant part of the customers’ ecosystem. Its use was not just limited to building connections but also social buying. Here users could review and buy products in real-time on these channels rather than redirected to a website or sales platform. Social commerce: the next trend in online shopping has evolved into a simple-to-use marketplace for ordinary people. It is also helping them establish their own business with the touch of a button and reach a larger audience at a low cost.
According to Accenture, social commerce will grow thrice as fast as traditional e-commerce, hitting $1.2 trillion by 2025. China will remain the most mature market and developing countries like Brazil and India will witness the highest growth. Gen Z and Millennials, who account for 62 percent of overall social commerce spending will drive this growth.
What the Digital shoppers want is a ‘Buy At The Moment’ experience.
According to Statista, the number of social media users is expected to hit nearly 4.41 billion by 2025.
Source: Statista
These social media-savvy digital buyers place a high value on convenience and in-the-moment experience. When it comes to purchasing decisions, they heavily rely on their social networks. Word of mouth, influencer and consumer reviews posted on social channels builds a sense of trust and an immediate desire to buy amongst Gen Z consumers.
Why social commerce is a win-win for businesses.
- Wider Reach :
According to a report by Recogn, there are 157 million social commerce shoppers, accounting for 53% of total online shoppers in India and this number could hit 228 million by the end of 2022, a 45% jump from the existing user base. Companies are increasingly collaborating with well-known influencers to boost their brand visibility. Leveraging influencers’ user base, brands are successfully creating trust amongst their followers in the long run. Recently, Instagram launched a product tagging in the US that lets users tag products featured on their posts. Customers will be directed to a dedicated page where they can access information such as pricing, availability, and more by clicking on the tagged product. Product tagging would help users discover products from the people they follow and businesses expand their audience on the platform.
- Higher Engagement:
Global Statistics revealed that Indians spend an average of 2.36 hours per day on social media. According to another report by Statista, India has almost 239.65 million Facebook users and 230.25 million Instagram users, and 126 million Snapchat users, making it the biggest country in terms of these channels’ user base.
World’s popular brand– L’Oreal teamed up with Facebook to introduce an AR-powered makeup try-on experience using AR for Instagram Shoppers. Snapchat partnered with MAC Cosmetics and Ulta Beauty recently to roll out an updated shopping feature “catalog-powered” shopping lens. Within two weeks, MAC Cosmetics witnessed a 17-fold increase in sales and over 1.3 million Augmented Reality (AR)-powered try-on, while Ulta saw a $6 million increase in sales and 30 million product try-on.
- Personalised and Localised experience:
According to Facebook, 54% of people surveyed said that they made a purchase either in the moment or after seeing a product or service on Instagram.
Social commerce is an important aspect of the web 3.0 ecosystem. Here the actual emphasis is on buying online things rather than buying things online. In the past two years, social channels have broadened the horizon for not just big brands but also for young and budding entrepreneurs and small firms looking to expand their business.
A Gurgaon-based company, Bulbul has registered 4 lakh transactions with around 15 million views via video streaming and interactive chat that helps users find new products. The bulk of the content is created by local women across the country who explain multiple products and their features in various Indian languages to give local trust to the audience.
The Road Ahead
As the social world expands, companies must create a fluid customer experience to gain customer attention and loyalty. There are some hiccups along the way. With so much content available today, creating real and reliable content for users is a significant challenge for businesses. Furthermore, because of the short customer attention span, keeping their audience captivated for an extended period of time is also tricky. Innovative engagement initiatives integrated with new-age technologies will go a long way in understanding customer buying patterns and helping brands develop a space in consumers’ minds.
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