The term “social commerce” is too often used interchangeably with e-commerce, when in fact they are distinct forms of digital retail. Social commerce is related to, but distinct from, standard online shopping, and deserves to be uniquely defined and addressed. So let’s start by defining what social commerce really is: it’s when the entire buying experience – the journey from discovering a product to clicking “buy” – takes place entirely on a social media.
This definition is particularly important for retailers when considering the role that brand engagement plays in delivering personalized customer experiences. The way consumers shop on social media is different from more general online shopping. Therefore, this means retailers need to focus their marketing efforts more specifically to increase their social commerce revenue stream.
Nurturing social channels is important because social commerce has proven its power in the consumer journey and its unique potential to drive ROI for brands. A report from a major consulting firm Accenture says social commerce is now a $492 billion global industry and is expected to grow three times faster than traditional e-commerce, reaching $1.2 billion by 2025.
Designing a social commerce strategy is an important component of brand marketing and should be differentiated from the brand’s overall e-commerce strategy. Given its great market potential, there is no better time than now for modern retailers to revamp and prepare their business strategies, incorporating best practices around social commerce as well as sophisticated analytics to ensure success. of each campaign.
Social Commerce: An Overview
Social commerce has grown steadily over the past decade, but in the past two years it has practically become the de facto means of purchase for millions of consumers. The Covid-19 pandemic has shifted consumers from physical stores to online shopping significantly. But that’s not all: mobile data traffic increased up to 50% in the wake of the pandemic, which means that consumer shopping is now increasingly done via mobile devices. With this, digital channels have become more influential during the purchase journey.
Where consumers may have once responded to television ads, billboards, or magazine articles, today’s consumer attention is centered on the smartphone screen. As a result, this is where a large number of purchasing decisions are made today. With a booming influencer landscape, digital content drives the majority of online sales today. Tailored content is used to educate consumers about a brand, showcase products, and build loyalty.
As social media becomes more ingrained in our daily lives, it is aligning with the e-commerce industry, making social media scrolling a shopping experience. This benefits both consumers for its ease of use and brands for its ability to reach consumers directly on their smartphone screen.
Social commerce and the role of influencer marketing
Influencer marketing is at the heart of social e-commerce. One of the biggest reasons people buy through social media channels is because of the discovery aspect of visual social media apps like Instagram and TikTok. Products can be presented to consumers directly through social media applications, using engaging content provided by social influencers.
Influencer content works effectively to enable social commerce because it is – even when paid for and clearly hashtagged as such – perceived to be more authentic than traditional advertising content. Influencers are viewed by the average consumer as a trusted source of genuine, authentic content. Consumers are more likely to buy a product when it has been recommended and featured by their favorite TikTok influencer than by a famous brand spokesperson.
This has led to a large redistribution of the advertising budget away from television and print media towards digital advertising, including influencer marketing. A recent report revealed that the Instagram influencer market will be worth $22.2 billion by 2025 (compared to $13.8 billion in 2021).
That’s why today’s big brands dedicate their budgets to influencer campaigns that enable social commerce, as opposed to more traditional forms of marketing spend. According to Robin Marchant, Chief Marketing Officer (APAC) at Shopify: “As customer acquisition costs soar, brands are looking to collaborate with creators to deepen relationships and build brand awareness, trust and loyalty. their audience.” And it pays off, because recent industry research reveals that influencer marketing campaigns bring in $5.78 for every dollar spent.
Content, authenticity and measurement of influencers
For brands looking to connect authentically with consumers (which, let’s face it, all brands should be these days), working with social media influencers as part of the overall marketing strategy should be a key consideration. . If implemented strategically and managed correctly, aligning a brand with the right influencers can make a difference in terms of a company’s visibility, brand perception, and most importantly, a company’s profitability.
One of the main ways to measure influencer marketing is to use engagement as a metric. Of course, when consumers authentically engage with content beyond simply giving it a “like” – i.e. writing a comment or sharing a post – it creates a brand connection that has been shown to drive sales.
But just as important as selecting the right influencers for a brand is having the right tools to measure the effectiveness of those influencers in real time and being able to make adjustments if needed. After all, trends change and the online world is changing rapidly. Marketers therefore need the tools to make quick changes to their campaigns as needed.
It’s all in the numbers: making sense
However, it can often be difficult for brands to keep track of what is working and where sales are actually coming from – and in an era where social commerce dominates, being able to do this is crucial to being able to redirect budget resources accordingly.
Brands need to be able to see the number of clicks, revenue, and ROI generated by their social influencer campaigns. Matching sales data with campaign data inside an influencer marketing tool can be tedious, often requiring the exported data to be manually matched in Excel. This can be time consuming and expensive and more modern and streamlined solutions are needed.
Fortunately, today’s marketers have a new skill set in their marketing toolbox: the power to analyze sales data and cross-reference it with campaign data from influencer marketing platforms. using automation technology. An influencer marketing campaign can be set up in minutes, and the analytics part of the resulting sales funnel should be too.
Automation is the name of the game here, enabling clear analysis of every influencer campaign. Every DTC retailer or brand can now access tools that leverage automation to deliver actionable data and insights at their fingertips. Influencer marketing is not just a fad; it becomes even more central for certain industries. Retail brands that take the time to implement and measure it properly have a head start in social commerce and, by extension, the ability to retain modern consumer demographics.