Brands and e-commerce nowadays are heavily reliant on digital platforms to reach their audience. In an age where everyone is glued to their screen, the most effective method to engage with them is through these devices.
This is evident when you look at the statistics surrounding internet and social media usage. In 2018, the number of internet users worldwide is 4.021 billion which is up 7 percent. The number of social media users worldwide is 3.196 billion up 13 percent. The number of mobile phone users is 5.135 billion up 4 percent. With these numbers growing each year, it is no wonder that brands are more eager than ever to use social media to engage and promote themselves.
In the current age of online presence, customers judge a brand by their social media channel. A business’ reputation lives and dies by their social media. It is not only used to build their brand image, but to advertise their products, promote their offers, give out coupon codes and deliver high-quality customer service, and such is also the case for e-commerce. Going forward, it is obvious that the function of social media for businesses is set to extend beyond branding.
Paid advertisements are the current trend in social commerce. Given Facebook’s incredible level of customization (age, geography, preferences, and more), brands are flocking to use the platform’s ad features. What is arguably more impressive is the reporting of the ads performance, and the detailed analysis it offers.
In terms of marketing, social media marketing has changed the way businesses reach and engage first-time customers. How? Social media is on the way to transforming itself from a being a platform used merely to display content, to an actual commerce portal. Businesses can trace and run their marketing strategy through social media, from customer acquisition, sales, to re-engagement campaigns.
Social media have become a very useful tool to access that hard-to-reach demographic of young engaged buyers and pushing those users to purchase a product.
Simply put, shopping through social media – often termed ‘social commerce’– may well be the future of e-commerce. It combines the fun nature of social media – the ability to share, recommend and show products to friends and peers – with the actual purchase activity, making the shopping experience fun, easy and seamless.
This also explains why unfriendly e-commerce sites with unpleasant interfaces are becoming unpopular and sell less. It is simply more practical and convenient to purchase products via Instagram, Pinterest, and Twitter. The adoption of easy digital transactions can transform the whole customer experience. One tap of the phone can close a purchase in seconds.
However, in order to really benefit from social shopping, users must really be convinced that social media is not merely a platform to share personal stories. They must be made to believe that social media is a platform where commerce can be conducted.
Some social media platforms have already sniffed this opportunity and have started working towards this. Facebook has been most notable in its effort to tap into the commerce space by launching Facebook Marketplace, though it is still at a stage where it is getting mixed results.
Its job now is to convince e-commerce players and retailers that social shopping is the way forward, as shoppers will always want a better, more accessible experience. Online businesses must start to provide a strong customer service and implement a strategy that integrates social media into the overall online offering.
Convincing online businesses to jump into the social commerce bandwagon by the masses, however, will not be easy. The likes of Facebook and Twitter will have to find ways to tackle a few challenges and get users accustomed to this new function of social media.
One of the biggest obstacles is the fact that social media will be going up against established e-commerce sites and marketplaces for a share of online transactions. It is safe to say that when customers intend to shop online, the first website that comes to mind would be the likes of Amazon and eBay. Social commerce is currently not really their first or second choices for online shopping, so this must be addressed.
Then there is also the matter of product range and selection. Limited selection makes for bad shopping experience. On websites like eBay and Amazon.com, you can pretty much find anything you need. This is not possible on social media, the way the platform is currently set up. The products and sellers are still limited, and it takes some effort to find exactly what you are looking for. It will important that social media adjust its social commerce feature to accommodate this aspect of online shopping.
Arguably the most important challenge to overcome, however, is transaction process. Popular e-commerce sites have made their sales funnel and buying process easy and all figured out, requiring only minutes or even seconds to close a transaction. Social media platforms need to figure out an easy and seamless transaction process and then make customers familiar with it. Replacing the ‘like’ button with a ‘buy’ button is good, but that is not enough to win over customers. Whatever the platforms choose to do, users should not have to think too much at the moment of purchase.
With the average person spending around an hour and 40 minutes on social media each day, the potential is there for social commerce to hold a firm place in the future of brands and businesses.
|This article was contributed by fellow NYU students. If you would like to make a contribution to the NYU Dispatch, please email us.|