Riding the tide of social commerce

Industry Insight

Traditionally, retailers have relied on attracting customers into their stores (whether physical or digital) and making a purchase directly from them. As such, the shopping experience was based around ease-of-use and speed – how quickly and easily could customers navigate a website, find what they wanted, and complete the purchase?

However, for many merchants, competing in that angle has become a daunting prospect. Retail giants such as Amazon have made competing on that front very difficult – Amazon’s site is easy to navigate, has a broad selection of items, low prices, customer-friendly policies and Prime subscribers even have free two-day shipping to rely upon. As such, retailers have turned to the shopping experience as a differentiating factor.

Social commerce embraces inspiration and product discovery.

Social commerce is one of the many ways sellers are engaging shoppers in a unique fashion. As a report from Business Insider’s Business Intelligence unit noted, social commerce embraces inspiration and product discovery. Sites such as Pinterest can act as digital catalogs, allowing customers to page through products in a social context, while reading comments and sharing some of the items they like on their own Pinterest boards.

Shopping has always been a social experience and a reason for people to get together for years, whether they are doing Christmas shopping, back-to-school shopping or just want to kill some time on a Saturday afternoon. In that regard, it only seems natural for retailers to bring social elements to the online shopping experience as a way to standout and engross customers in the process of making purchases.

Implementing social commerce

Because social commerce offers such a unique shopping experience, many retailers are looking to implement it into their operations. The key is realizing that social commerce is not just another way for brands to garner sales, they shouldn’t just be posting “buy now” links on social sites and expecting to rake in the sales. As Business Intelligence explained, social commerce needs to be about enveloping customers in the social shopping experience.

To that end, clever merchandising, interactive content and highly relevant and personalized offerings and campaigns play a pivotal in making a distinct shopping experience that is tailored to customers’ needs. The goal is to craft a sharable, relatable shopping experience instead of simply urging people to buy, which may be the approach with more conventional retail stores. In this case, shopping is not just about buying, but about sharing feedback, writing reviews, recommending products to friends and showing off purchases.

“Companies will not only focus on connecting with the consumer through social media but will also integrate their eCommerce strategy with their overall social media strategy.”

“Companies will not only focus on connecting with the consumer through social media but will also integrate their eCommerce strategy with their overall social media strategy,” suggested a recent study from ReportLinker. “Social commerce marketing is fundamentally reshaping the operational structure along with the strategic focus of food & Beverage companies. This channel is expected to [create] impact beyond marketing, driving strategies related to product innovation, supply chain management, and operational efficiency.”

As retailers look to embrace social shopping, they need to look at their audience, their habits and their preferences and decide upon an approach that will resonate with shoppers. Social commerce is not a “one size fits all” strategy. For example, sellers of “one of a kind” or home-crafted goods may do better on community-based sites such as Etsy. More conventional retailers may want to leverage buy buttons on sites such as Twitter and Facebook. Other retailers have a lot of success with user-curated shopping (such as The Fancy, which allows users to create and share lists with other customers).

Facebook “like” buttons, Pinterest “pin it” buttons, Twitter “tweet” plug-ins, ratings and reviews – these are all social signals that retailers should look to incorporate.

The real value of social commerce

Of course, giving customers a unique shopping experience is something every retailer should look to do, but social commerce does not just benefit the customer – it is a boon for merchants as well.

Social commerce sales could account for as much as 5 percent of online retail revenue in 2015.

One recent infographic from Hubspot noted social commerce sales could account for as much as 5 percent of online retail revenue in 2015, with social platforms garnering more than 14 billion sales – a significant jump from 3 billion in 2012. Retailers need to take a proactive approach in managing the experience, as products with good reviews and feedbacks can see large bumps in sales, while negative reviews can actually cost brands their sales.

Social commerce not only improves the shopping experience, it also gives retailers a point of distinction and may help them pull in more sales. Over the course of the next year, merchants should look to integrate social commerce when and where possible, if it makes sense for their customers.