Social commerce definition: Strategy, Examples and Trends in 2021

Thanks to the big boom of state-of-the-art technology, online shopping is significantly favored on a global scale. However, in recent years, besides shopping on e-Commerce websites, another platform for customers to purchase online is through social media channels. Thus, the term ‘Social Commerce’ gradually has become more common to everyone, not just retailers, since Facebook launched its Marketplace in 2007. 

What is Social Commerce?

Perhaps, you have not heard about this term before, but indeed, you have seen it. Let’s recollect every time you surfed Instagram or Facebook, and you saw a photo image of a brand – with a product tag or Buy button on it. What you saw is precisely Social Commerce. 

Social Commerce is the employment of social media channels to advertise and sell products or services, facilitating transactions. Simply put, it integrates all eCommerce functions and purchasing processes directly into social networking sites. With Social Commerce, customers can experience all the shopping journey – from product finding, choosing to check out process – on social media, without leaving the app or redirecting to any website. 

Not surprisingly, the Social Commerce industry worthed the US $89.4 billion in 2020 and is estimated to reach over $600 billion in 2027, with a 31.4% CAGR.

Social commerce vs. eCommerce: the differences 

Some people may feel confused about these two terms ‘Social Commerce’ and ‘eCommerce.’ Although sharing some similarities, they are not totally the same. 

ECommerce is about the buying and selling processes via the Internet (websites or branded apps). Although this model is a tremendous revolutionary step, it is a long way from perfect due to some shortcomings. In 2020, over 68% of Internet traffic came from mobiles, and on mobile, there is a higher cart abandonment rate. 

One of the top reasons for this problem is that traditional eCommerce requires too many steps and time, making the customers’ journey longer. For example, when they are interested in a product promoted on social media, they have to click on that ad and wait to be redirected to the company’s website. Then they have to fulfill the shopping cart, fill in personal details and credit card information. All of these complicated steps will lead to a risk of buyers abandoning the buying process. 

About Social Commerce, it allows customers to make a purchase and finish the transaction in fewer steps (typically three), right on the social media platform where they see the product. Undoubtedly, mobile and Social Commerce are compatible. 

Why is Social Commerce important for businesses? 

As of 2021, Facebook has over 2.8 billion active users, while Instagram has more than 1 billion. These statistics demonstrate social media platforms are lucrative markets for businesses’ growth. Moreover, more than 87% of online shoppers stated that social media formes their shopping decisions. So, why not let them make the payment right away on social media instead of redirecting somewhere else?

For businesses that want to be more competitive, they should consolidate Social Commerce into their sales channels. Undoubtedly, Social Commerce has brought several benefits to these companies. We have listed some of them below.

  • Enhance customer experience by removing friction 

As stated previously, Social Commerce helps online customers to complete their payments more accessible and faster. It eliminates the friction in the buying journey, streamlines the check-out process, and is a crucial key to increase conversion rates, reduce bounce rates. Therefore, customers can enjoy a seamless shopping experience. 

Moreover, fewer clicks mean customers have less confusion about their shopping decisions, which means that they do not have enough time to change their minds. 

  • Presents a prompt focus group 

Besides providing online buyers a more straightforward buying process, Social Commerce also provides an impressive way to collect customer feedback. When your products are displayed on social media, they will be reviewed and discussed by the world. Your customers will leave their feedback to tell you what they do not like and what they like directly. From their responses, you can form your product development decisions. 

Moreover, Social Commerce provides you transparent data of your customers, gives you the chance to chat with them individually, via comments or messages, to improve customer service and experience. 

  • Makes shopping more interactive and drives authentic engagement 

Different from purchasing from the businesses’ websites, Social Commerce is much more interactive. The most robust feature of Social Commerce is two-way communication, which strengthens your brand by connecting with your audiences. It gives the customers a chance to engage directly with businesses and use social media platforms as an effective and personalized customer assistance channel.

While customers are scrolling through your catalogs, they can easily tag their friends to know those opinions if they are interested in any products. They can also comment or review comments from other buyers to make up their minds. Moreover, thanks to social media word-of-mouth, such as sharing or reposting, engagement will be increased, and your brand will have wider audiences. 

Best platforms for Social Commerce 

So far, several social media platforms have tested and implemented Social Commerce. However, not every channel has done this perfectly. Let’s look at the best platforms with Social Commerce features – Facebook, Instagram, and platforms with beta versions – Pinterest, Snapchat. 

  • Facebook

Apart from Marketplace that users can upload their local products, Facebook launched a Social Commerce tool of Facebook named Facebook Shops. This feature is totally customizable and free to set up within Facebook business profiles. 

In case your eCommerce solution is assisted as an associate platform, your whole inventory list will be synced in seconds. Otherwise, you can upload your products via spreadsheet or create collections from scratch. Moreover, when creating a shop page, you can choose feature collections, customize the images, fonts, and colors that fit your brand. 

Facebook also offers numerous features such as in-app checkouts or direct messaging, etc. Significantly, with Facebook, you can make a test shop to test your customer experience and response. 

Social Commerce on Facebook
  • Instagram

Another platform that is fitted to Social Commerce is Instagram. Instagram has “Shops” that allow businesses to customize their storefronts to display products with custom details. If you already have Facebook Shop, Instagram shopping is connected directly. To build a shop, businesses must link their Instagram account to the Facebook profile. Once that’s done, they can start upload products. 

At its core, focusing on visual elements, Instagram has much more opportunity to promote creative and visual products. Purchasers can buy any products within the platform through shoppable posts or stories that connect directly to in-app collection pages. In addition, similar to Facebook, buyers can pay in-app via Facebook Pay or on business websites. 

One thing to note is that Instagram Shops is only suitable for companies with physical products, not services. 

  • Pinterest 

Thanks to the nature of Pinterest with a perfect discovery engine, it is ideal for Social Commerce 2021. In addition, Pinterest always provides relevant recommendations to customers of shoppable products. 

Actually, Pinterest’s product pins are not technically Social Commerce tools, as purchasers still have to redirect to another landing page to make their payment. But it still allows businesses to showcase products on Pinterest Shop. These shoppable posts are precisely like regular pins but have more details such as price and availability. 

  • Snapchat 

Currently, Snapchat is testing a new Social Commerce feature named Brand Profiles, which allows companies to make a product list and sell them in-app. Indeed, in the near future, Snapchat will launch a complete version of Commerce. 

>>>> Read more: Top 6 Social Commerce platforms that you must know

Top Social Commerce trends 

On account of the popularity of Social Commerce, several Social Commerce trends start to be used and are becoming more and more dominant. Here are only some of them: 

  • The use of chatbots and messaging apps 

According to research, customers tend to make a purchase decision faster if they feel that their shopping journey is personalized. Therefore, messaging apps, including Facebook Messenger, WhatsApp, etc., have been used recently, allowing real-time conversations. 

However, these personalized conversations need a lot of human resources and are hard to effectuate at scale. That is precisely where Social Commerce technology – Chatbots, exerting full power of AI abilities, be taken advantage of. Chatbots can provide natural conversations with customers and answer their questions in no time. 

  • Live Streaming will gain more popularity 

Although this trend has arisen recently, there is no sign of evaporation in the near future. Many businesses have used live streaming to show their new products in more aspects, provide step-by-step tutorials, or simply answer customers’ questions. Live streaming provides an authentic and interactive experience, which can be combined with Social Commerce.

  • Voice Technology will be applied in Social Commerce 

Nowadays, we can easily see the dominant voice-based products in smartphones and stand-alone devices, including Google Home, Alexa, etc. To catch up with this trend, 91% of brands have started to invest the integration using voice technology. For Social Commerce business is no exception. 

Although the ultimate use of voice in Social Commerce may still be a couple of years away, generally speaking, Social Commerce future is Voice Technology. 

Best Social Commerce strategies 

Social Commerce is on the rise, but how to make the best use of it? Let’s read through some of the best Social Commerce strategies that businesses may need to learn to win customers’ hearts and wallets. 

  • Know your audiences and invest in the right platform 

People use various social channels every day; however, not every business has infinite budgets and resources to spend on all digital advertising. The better you understand your buyers’ personal, the quicker you choose the right digital platforms. 

So how do you choose the best social media platform for your business? You may need to answer the following questions: Which social networking site will mesh with your products? Which channels your target customers often use to browse and share content? For example, customers want to see them on visual platforms such as Instagram or Pinterest for fashion items such as clothes or jewelry. 

  • Create a seamless checkout process 

For marketers, all know that fewer clicks mean higher sales. When customers are scrolling social media feeds, and they know what products they want to buy, there is one thing that no business wants to create. That is the slightest barrier between the moment of awareness and making payment. 

Therefore, cutting the unnecessary checkout steps is critical. Businesses can integrate features such as Amazon Pay to offer a hassle-free paying process. With this, customers can have a quick purchase and go back to surfing. It does not only help to avoid cart abandonment but also encourages them to repurchase. 

  • Leverage User-Generated Content 

User-Generated Content (UGC) is everything customers create that related to your brand, including reviews, images, videos, etc. Because 92% of buyers trust UGC than traditional marketing, that is why businesses are more likely to use UGC. This strategy helps companies save money and human resources on curating content, but most importantly, it also supports gaining reliability, credibility, authenticity, reach, and customers’ insights. 

Inspirational Social Commerce examples  

  • Itzy Ritzy 

Itzy Ritzy is a baby brand – focuses on selling baby products such as toys, clothes, etc. They know their target customers are moms, so they use lifestyle marketing to connect with customers. Almost every picture of Itzy Ritzy featuring shoppable products so that customers can shop directly from the photo. Moreover, Itzy Ritzy also has its hashtag for better use of User-generated content. 

  • Sephora

No longer strange to everyone, especially makeup lovers, Sephora is a retailer of beauty and make-up products. To keep up with the times and trends, Sephora has used Social Commerce and divided its products into different categories or collections for easier finding. 

  • Shine On

Shine On is a clothing brand located in New Zealand. Shine On has a tab “Shop” on their front page for customers to browse the catalog without leaving Facebook. Like any eCommerce store, all product details, including price, specs, and colors, are displayed clearly. Furthermore, they also provide Similar Products so that their shoppers have more choices to choose from. 

Final thought

In a nutshell, the idea of Social Commerce has been around for quite a long time, but it has impressive utilization among businesses and people all over the world in recent years. Moreover, both social media and e-Commerce infiltrate more in our daily lives, so there is no surprise that these two are blending perfectly. Hopefully, after reading this blog, you can broaden your knowledge about Social Commerce and turn it into an advantage. 

Don't want to miss out on our latest insights?
Subscribe to our newsletter.

Disclaimer: By clicking submit, you agree to share your information with us to receive news, announcements, and resources when they are available.