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5 Important Benefits of Enabling a Social Commerce Channel

Traditionally, users visit a website to search and purchase the products they want. But with the world of commerce constantly evolving, businesses are finding new ways to connect with their users on other platforms – especially social.

What is Social Commerce?

Unlike social media marketing, which redirects users from an advertisement on a social platform to a company’s website, social commerce is the process of selling products directly through social media. This provides organizations the opportunity to advertise and market products and services on the digital platforms their users are most active on.

Social commerce has become increasingly popular over the last few years. In 2019, social commerce sales were estimated at $22 billion in the United States and are projected to reach $84.2 billion in 2024, accounting for 7.8% of U.S. retail ecommerce sales.

What Made Social Commerce Popular?

The rise of social commerce is primarily thanks to Millennial and Generation Z users. Generation Z in particular spends 2-3 times more revenue while shopping on social channels such as Instagram and Snapchat than the average user and is on track to becoming the largest consumer generation in the world with the $143 million in direct spending they represent.

Where They’re Shopping

Platforms such as Instagram, Facebook, Pinterest, Snapchat, Twitter, and TikTok are top platforms that promote social commerce as means of engagement for brands and users, with 84% of those users being the target age of 18-29 years old. Instagram found that over 80% of their users are on their platform to research products and services, and more than 130 million users click on the shopping posts per month.

Facebook Shop lets businesses connect with customers and prospects via Messenger, WhatsApp, or Instagram Direct, allowing these organizations to customize their shop and import or create a product catalog on the platform. Pinterest has a similar approach to its product catalog options and provides businesses the opportunity to add the “Shop the Look” feature to display which items in the Pin are available for purchase. These platforms have learned that users want easy access to the products they love and regularly buy on their preferred social channels.

Why You Should Leverage Social Commerce for Your Business

Here are five main reasons why you should incorporate social commerce into your marketing strategy:

Builds Strong Brand and Product Awareness

Let’s look at it from the perspective of the marketing and sales funnel, which consists of the following stages: awareness, interest, consideration, intent, evaluation, and purchase.

The awareness and interest stages are considered as “lead generation” stages. This is when buyers identify their pain points and need for a product. There are many tools leveraged for this stage of marketing, such as marketing campaigns, events, ads, trade shows, social media, and others. Once the buyer is aware of the product, then it’s key to generate interest via tools such as emails, newsletters, and others.

Then we have the consideration and intent stages, collectively known as the “lead nurture stage.” This is when buyers start to learn more about the brand with an intent to eventually make a purchase, and we begin to overlap our marketing strategy with our sales strategy. The brands start to share details about brand positioning, product information, case studies, product demos, and so on to start to nurture the leads.

Social media has played a key role in these stages for years. By sharing rich product information on social channels as part of “brand-generated content,” as well as by leveraging the user-generated content (UGC), brands can engage with buyers on a larger scale. This additional commerce functionality to social channels has helped strengthen the relationship with buyers, nurture their interest, and keep them engaged with the brand and their product offerings.

Shortens the Sales Cycle

The final stage of this buyer journey is evaluation and purchase. This is where the value of your products is proven against competitors and a final purchase is made. By enabling social commerce, it’s fair to say that the timeline between lead nurture to purchase is accelerated.

Consumers were already seeing the product and pricing information on their social channels, allowing them to learn more about the company and its products. With the commerce functionality, buyers can make a purchase directly within the social channels in a couple of clicks without having to leave the social media channel. This helps increase revenue for the company by selling faster.

However, there is a risk factor to leveraging social media, and that it may lead to bad press and negatively impact the brand image. To avoid this, it’s key to maintain accurate product information and great customer service support.

Increases Customer Loyalty and Recurring Revenue

Social media has become a direct channel to build customer relationships. Buyers gravitate towards how a brand makes them feel and how they’re treated on their buying journey. Social channels have become a key marketing strategy, and they must be a priority and not an afterthought. It’s important for a brand to have a clear message around who they are, what they sell, and to whom.

With rich product information and great customer service, brands can sell fast, build strong relationships with buyers, and turn them into repeat customers.

Builds Authentic Engagement and Stronger Sense of Community

Social media requires sellers and buyers to be more social than the traditional selling channels. As previously mentioned, social channels allow for easy distribution of product information to a vast audience of prospective buyers. Once a purchase is made, the buyers share their feedback on the social channels through testimonials, ratings, images, and even comments on posts. These are real and authentic interactions.

As the company continues to build the customer base and sales start to increase, these buyers remain active on social media and share their buying experiences and opinions about the brand. This chain reaction helps inform others to try these products and builds a strong community of followers and influencers.

Increases Search Engine Ranking

This may not seem obvious, but enabling social commerce does help increase a company’s commerce website search engine ranking. Social commerce is the enablement of commerce features on a social channel, meaning it’s still required to maintain a full-featured commerce website representing the brand and its entire catalog.

As companies post information about their catalogs on social channels and respective social media pages, it’s recommended to have a call-to-action related back to content on their website within their posts, comments, and even brand profile pages. This helps increase user traffic to the website and helps increase its search engine ranking.

Social Commerce is a Game-Changer

If your business hasn’t already utilized social commerce channels as means of getting your products in front of your buyers, then you might be missing out on some of the benefits that could greatly impact your business. For more information on social commerce, contact our experts today.

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Ritesh Keskar

Ritesh is an eCommerce Practice Director and PIM Consultant at Perficient. His role is to provide consultation to clients for their Product Information Management strategy alongside their Commerce Solutions roadmap, as well as to assist with platform selection and implementation.

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