How Does Commerce Happen On Social Media?
- With nearly 3 billion users, social media covers about 40 percent of the world’s population.
- According to research by e-marketer, more than half of the adult population in the U.S. have been using social media at a higher rate, since the coronavirus pandemic started.
- Affordable smartphones and cheap data prices have driven the popularity of social media.
- And, social commerce has become the latest model of the business transaction, especially for small businesses.
What Is Social Commerce?
- Social commerce is the next generation of electronic or online commerce merged with a social platform.
- It is similar to e-commerce but the buying and selling are done on social networking sites like Facebook, Instagram, Pinterest, and Twitter.
- Facebook, Instagram, and WhatsApp, together have a collective reach of over 400 million users in India.
- According to a report by Bain & Company, social commerce in India is expected to touch $ 16 billion-$ 20 billion in Gross Merchandise Value by 2025.
- A report by Red Seer Consulting says that the current market share of social commerce is 1-2 percent of India’s e-commerce market, but it will grow to 4-5 percent by 2025.
- The growth is due to the millions of small retailers who are using the reach of social media to increase their business.
- Social commerce uses social interactions and user contributions to enable online transactions of products and services.
- It is at the intersection of social media, advertising, and e-commerce.
What Are The Main Social Commerce Platforms?
- The key social commerce platforms are Facebook, Instagram, Youtube, and Pinterest.
- Instagram is bringing out a Checkout feature which will allow users to search and shop with brands online, directly within the app.
- It has also added a shopping channel called “Shop and Cop” for mobile users, who don’t have to go to a separate website for purchase.
How To Sell Products On Social Commerce ?
- Social commerce is a cost-effective way for an owner of a small business to offer information on products.
- If you are a B2C business, integrate Facebook and Instagram with your e-commerce store, and start tagging your posts with products.
- Add ‘buy’ buttons to your social media posts.
- This enables your audiences/customers to make instant buying decisions.
- Social platforms are offering solutions to make it easier for merchants to sell products.
- For a start-up in the retail space, Instagram offers a great way to connect with followers turned customers.
- It is allowing people to buy products by linking to e-commerce sites.
- Facebook is one of the most popular online social media platforms where more than a billion people spend their time.
- It has recently launched Facebook Shops which enables an entrepreneur to quickly set up an online shop, either on Facebook or on Instagram.
- It connects people to brands, businesses, and products and helps merchants to showcase and sell products.
Benefits Of The Facebook Shop Page
- Organise your products into categories and collections.
- Followers can browse and shop, and get seamlessly transferred to a secure checkout.
- Directly communicate with your customers.
- Facebook Commerce Manager has links with other major platforms which enables merchants to manage orders, send product details and link inventory across Facebook Shops and Instagram shopping.
Know The Consumer’s Mindset
- Customers want their shopping experience to be as easy and quick as possible.
- You should make sure that your sales posts are visually appealing enough to stand out in a busy news feed.
- You can create your mobile-optimised website and link it to your social media account.
- You must ensure that your customers have a smooth shopping experience, so work with the most efficient technologies and payment gateways.
- The most popular products for social selling are apparel and accessories, followed by electronics, health and wellness goods, and home items.
- Make sure that your product data like colour, description, size, titles, etc. is complete.
- Take a nice picture, add the price, the name and stock.
- Facebook uses this data to reach out and merchandise products.
Things to Do
- Choose your payment methods like a credit card, debit card, or online money transfer.
- Set up your delivery options.
- Select who you are going to sell, and share the information through Facebook, Instagram, or any social media platform of your preference.
- Your client will receive a link to purchase the product.
- After you receive the payment, you ship the goods.
- You can also include influencers in your project and share your catalog with them.
Reasons For The Popularity Of Social Commerce
- People buy based on social opinions and proofs and not just based on advertising.
- Just as ‘word of mouth’ helps to spread the popularity of a product in the physical retail, similarly ‘likes’ and ‘tweets’ do the same in social media.
- Consumers can see live product demos which help them to make choices.
- Compelling and engaging videos influence customers to buy.
- Affiliate marketing and influencer marketing works very well.
- Customers take time to get familiar with new brands and they are comfortable with an interface that they know.
- It offers a seamless purchase experience, and assists consumers in buying something without switching channels.
Social Commerce Vs E-Commerce
Social commerce is proving to be more agile than e-commerce.
- Social commerce enables conversation with brands and product discovery happen in real-time.
- In e-commerce platforms like Amazon or Flipkart, customers have to go through a catalogue first, which may be several days old.
- In social commerce business there is direct communication between buyers and sellers through photo sharing or videos.
- It is a two-way communication which needs daily monitoring.
- In contrast, in e-commerce there is one-way communication which does not need daily monitoring.
- In e-commerce the shopping happens via a website or an app.
- In social commerce, customers purchase within the social media platform.
- Customer engagement is more in the case of social commerce than e-commerce.
- Traditional e-commerce models have too many steps for the customer and takes up a lot of time.
- So, what happens is that the customer might get frustrated and abandon the cart and leave.
- Social commerce is simpler, takes less time, and has all processes under one roof.
- Consumers can see the product, watch videos and read reviews, and make the purchase without leaving the platform.
What Is The Future For Social Commerce Startups?
- The success of social commerce startups in India is linked to the demand for eCommerce and the country’s vast social media user base.
- Social commerce was the fastest-growing segment in India’s online retail space in 2019 and is expected to be twice the size of the current eCommerce market by 2025.
- These startups use business models like group buying and reselling and launching new products.
- Some startups are targeting buyers and sellers in Tier-1 and Tier-2 towns that have high internet speed now.
- They have over 10 million resellers on their platform and have received great interest from foreign investors, having received over $100 million in funding over the past 12 months.
- Meesho is an example of a successful startup that follows a reselling model.
- It helps millions of small entrepreneurs run digital stores on social platforms.
- Another promising startup is GlowRoad, which provides resellers access to the right suppliers, payment gateways, and logistic support.
- Social selling is similar to traditional advertising and marketing and refers to cultivating relationships in social media to build up your sales prospects.
- It could be general posts with information about specific products or deals with relevant and interesting imagery.
- It could even be an influencer or sponsored posts.
- Effective and relevant social selling can lead users away from social media and onto channels where users want to make a purchase.
- It can be either online or in-person.
Why Is Social Commerce Important?
- Social commerce is expanding, but not all users are comfortable with it yet.
- Also, many new businesses have fallen into a social business loop, attracting non-targeted audiences, and generating little leads.
- Another danger is that of a disgruntled customer taking his/her problems to social media without going through a formal redressal process with the company.
- This can damage your brand.
- Though it is a comparatively new phenomenon, social commerce can be a very useful channel for small business to increase their sales and turnover.
- It is the most relevant online marketing platform today-if you want to be in the game, you must board it.
- We hope that you find this article useful for that purpose.
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