Online commerce continues to grow as well as evolve as new technologies, particularly mobile technologies, gain importance. Social commerce is also gaining prominence, and in 2015, social commerce is expected to represent 5% of all online retail revenue, or around $14 billion in sales.
Brands recognize the importance of social commerce and Social Media in general as an influencer. Sixty-five percent of top brands post five or more times per week on Facebook, because Social Media is a fantastic technology for spreading the word about brands, products, and services.
Social Media Became More Closely Bound to eCommerce in 2014
Social apps that encourage shopping also gained prominence in 2014. For example, the UK app called Shopcade allows app users to save items they like and receive alerts when they go on sale. Users also receive product recommendations based on their social and online shopping data. Social gifting was another form of social commerce that grew in 2014, particularly in the US. This practice lets people give gift cards to friends directly on Social Media, increasing social engagement and social purchasing.
Customers Expected Much More from the Social Commerce Experience in 2014
Customers expect a lot from eCommerce and Social Media, and in some cases they expect more than businesses are capable of providing. Eighty percent of retailers now use Social Media in some capacity for customer service. While this can be an efficient way to improve customer service, customers have high expectations of customer service provided via Social Media, and companies that aren’t prepared to deliver can fuel further customer dissatisfaction. And customers don’t just consider Social Media as a “Plan B” for when they can’t contact a company by phone. The convenience of Social Media means they are increasingly using it as their first and sometimes only method of reaching out to a company’s customer service team. This push from customers may lead to more and more companies utilizing Social Media across their businesses instead of just for marketing efforts.
Facebook and Twitter Tested On-Platform Purchasing Technology
The two most well-known Social Media platforms, Facebook and Twitter, tested “Buy” buttons in 2014 to give their users a way to make purchases without having to leave the Social Media network’s sites. Though Facebook’s Buy button was met with a mixed response, many eCommerce experts believe it signals a tipping point of sorts in social commerce. Twitter users can use the #AmazonCart hashtag to link directly to an Amazon shopping cart, and American Express now allows people to pay using a hashtag. This latest evolution in social commerce enables users to immediately buy items recommended by friends or social retailers with ultimate convenience.
Retailers Incorporated Social Media More Prominently in Holiday Campaigns
In the 2014 Christmas retail season, two-thirds of companies expected to spend more on Social Media than they had in 2013, with the vast majority of marketers putting their social marketing resources on Facebook during that time. Companies now view Social Media as a legitimate sales channel, and believe that opportunities for retailers to generate sales directly through Social Media will continue to open up.
What Might This Mean for 2015 and 2016?
Online marketing is expected to include more paid Social Media advertising in 2015 and onward. Facebook has made it easier for retailers to target “look-alike” audiences in order to extend their brand reach, and Twitter plans to sell ads within tweet streams on other publishers’ websites and apps. Video ads in Twitter may also be on the horizon. Other social networks are expected to continue to make Social Media advertising easier and more effective for retailers.
At the same time, social commerce is expected to become more targeted and personalized in 2015 and 2016. Increased user engagement on social platforms will make it easier for companies to personalize incentives and drive sales, both on desktop and on mobile devices. This will require businesses to make optimum use of analytics like Facebook Insights in order to create richer, more informative customer profiles.
As expected, social commerce matured and grew in 2014, and the process should continue. Whether or not a company engages in selling directly on Social Media platforms, the importance of Social Media for brand building and delivering traffic to eCommerce sites is undisputable. The businesses that learn to harness Social Media’s power through planned Social Media strategies are the ones that will benefit most, as new technologies and analytics continue to make social platforms rich sources of customers and customer insights.