What is social commerce, and why should you use it?
Following the growth of e-commerce, there has been an abundance of new ways that allow your customers to shop. From Buy Now Pay Later solutions to bundling, subscriptions, and social commerce, merchants can engage with their customers more and gain valuable insights into their customers' spending habits.
While all of the features mentioned have their route to success, we're focusing on social commerce. Social commerce is the buying and selling of products through social media platforms, allowing customers to complete their purchase process without having to navigate away from their preferred platform. Of course, influencers with affiliate links, paid adverts, and more are available to brands on social media, but social commerce is an entirely different ball game. To put things into perspective, with data from Statista, the branch of e-commerce generated $475 billion in revenue in 2020, with an expected growth of 28.4% annually, reaching a whopping $3.37 trillion by 2028. Have we got your eyes doing dollar signs? Good.
So aside from the revenue opportunities, what are the benefits of social commerce?
Benefits of social commerce
No need for redirects
While it isn't the most arduous task for a user to find their favorite product on social media and be redirected to the brand's website for checkout before re-opening their original app for browsing again, it can still be off-putting. With big brands like Amazon offering smart buy, customers have grown to expect a shopping experience that takes minimal time and effort, and social commerce allows that. Giving customers checkout directly in their social media app removes the many steps that could reduce their likelihood of purchase with each click, and buying becomes as easy as liking a post.
Boost social media engagement while selling
Marketing will often use social media for top-of-the-funnel stuff - driving awareness, engagement, and hopefully conversion. With social commerce, you can nail all three at the same time. Posts that were once awareness or educational can link to products that customers can purchase quickly and directly through their preferred social media.
Social commerce is huge and only improving
Social commerce has boomed since the pandemic. For example, in 2022, Shopify announced integrations with Tiktok, Twitter, and Youtube on top of their existing Instagram and Facebook integrations (more on these later). As a result, Shopify merchants now have access to the latest and greatest platforms to promote their business and convert users.
UGC and social commerce go hand in hand
User-Generated Content comes from social media or reviews and is directly posted to your e-commerce site. However, by promoting UGC through social commerce, merchants can use customer content on their profiles and social stores, linking the products that can be directly purchased on their social media app, shortening the purchase from inspiration straight through to conversion.
Create a better User Experience for your customers
While it's not difficult for users to discover a product via social media, then search for it on the relevant e-commerce store, connecting the two touch points certainly makes for a more delightful user experience. Which in turn may help you reach new customers.
Social Commerce platforms and their Shopify integration
What was once a dance app has quickly become an information-sharing, shopping, reviews, lifehack, comedy app, and more. In fact, TikTok has become the fastest-growing social media platform in history. And Gen Z is the generation behind this enormous growth, with 60% of app users being Gen Z and the next highest being millennials.
What about social commerce?
TikTok's popularity doesn't start and stop with views. Nor does it stop at inspiration (although with 16 billion views across the hashtag #TikTokMadeMeBuyIt, it could do). In 2022 TikTok honed in on the established trust between users and influencers on the app and decided to invest in TikTok shopping, allowing influencers and brands to link to products available to buy in TikTok shop.
TikTok's fresh take on advertising and authentic videos has created an environment where Gen Z can't tell what's an ad and what's not, creating a greater sense of trust between viewer and creator. Whether comedy, beauty, fashion, or food, brands have devised creative ways to promote products on the app. And it's worked - 60% of Gen Z TikTokers follow brands on the platform, and more than half of them search or shop for products on the app - driving sales. Need more convincing? Here are some incredible stats from Shopify:
- 67% of users say TikTok inspired them to shop even when they weren't looking.
- 73% feel a deeper connection to brands they interact with on TikTok than other social media platforms.
- 78% agree that the best brands on TikTok are ones that share their ideas and work together with users.
So what's next for this platform?
TikTok has begun hosting TikTok Shop Live events on the platform where users can shop directly from the live stream in-app. These live events have proven hugely successful, with the most recent Summer Sale bringing in over 276million live views. Following this success, TikTok Shop Live will be a big focus for the platform. They'll be continually developing this feature based on the success of the summer sale to improve the shopping experience with the knowledge this route to commerce is worth investing in.
Shopify x TikTok
In 2021 Shopify announced a direct integration between the e-commerce platform and TikTok for merchants on Shopify. They piloted the new integration with Kylie Cosmetics allowing the brand to link to products in their videos, which users could click, shop, and buy all within the TikTok app. As the first e-commerce platform to launch this integration, Shopify demonstrates its fresh, modern, and up-to-date approach to e-commerce. Expect more brands using Shopify to make the most of this integration into 2022 and beyond.
Facebook + Instagram
As Meta owns both Instagram and Facebook, the social commerce practice for both goes hand in hand. However, while Facebook was the originator of bridging social media with business, Instagram has taken on a life of its own as one of the top 10 most searched sites on Google and the most downloaded social media app. So, let's start with Instagram:
Approaching its 12th birthday, Instagram has been around for a while. And throughout its existence, it has built up quite the audience with 2.9 billion global visits per month and 1.5 billion daily users. What makes Instagram so popular with young and older generations is its continuous in-app updates and features that meet the demand of its users, including reels, stories, and Instagram Shop.
Instagram and social commerce
Instagram launched Instagram Shop in 2020 following the prolonged success of the app's influencer, affiliate, and paid marketing opportunities. Instagram sought to reduce the user journey by allowing shoppers to purchase products directly from Instagram posts and merchants to create their own Instagram storefronts.
And it's been quite successful - according to Hootsuite, 130 million people tap an Instagram Shopping post and engage with Instagram checkout every month. In addition, brands using the Instagram Shopping feature have seen an uptake of 1416% in traffic and a 20% increase in revenue since launching their Instagram store.
As for Facebook, most users are Gen X and later Millennials as opposed to Instagram and TikTok's predominantly Gen Z and Millenial users - but that doesn't mean you should discount it.
Facebook and social commerce
Like Instagram, on Facebook, merchants can sell via Facebook Page Shop to customers with customizable collections pages and the ability to feature products. However, on Facebook alone, merchants can sell directly through the app on Facebook Marketplace. In 2021 Marketplace garnered 1 billion monthly users. And according to Hootsuite, Facebook Shops have over a million regular buyers every month, with brands seeing 66% higher order values via Shops than their e-com site.
What's next for these platforms?
Following the launch of Instagram Shop, Instagram has taken the in-app shopping experience further by launching Instagram Shop ads. Ad placements in the Shop tab make it easier for users to discover new products and shop from different brands when browsing on Instagram Shop - think ASOS but social media.
Facebook is still actively rolling out support for their Facebook Shops to make it available in Facebook Groups, focusing on Live Shopping (similar to other platforms - perhaps a new trend?) and offering product recommendations. In 2022, Meta announced their AI-driven project, allowing merchants to post on Facebook and Instagram in their native language. In addition, meta will automatically translate the content for users in different countries - this is a massive bonus for brands breaking into international markets and using social commerce as a direct means of selling internationally.
It's no surprise Shopify has created an integration for Facebook and Instagram, allowing a more seamless customer journey and an easier admin task for Shopify merchants.
With Shopify's Instagram and Facebook integrations, brands can sync their product catalog from Shopify to the apps without manual input, and offer one-tap checkout, so customers don't have to leave the app. Brands can also customize their app shop to look and feel like their e-commerce store for a consistent and coherent brand experience.
Connecting your e-commerce platform and social media shop allows for better inventory management. With Shopify, you can use one product inventory across multiple shopping experiences so that you'll never lose track of in-stock and out-of-stock products. While you don't need Shopify to sell on Instagram or Facebook, it makes managing your online store a lot easier, with all social media integrations and Shopify store management in one place - the Shopify Admin.
Youtube has been around for a long time but still reigns supreme as the world's most popular video-sharing social media platform, with 1.7 billion unique monthly users and 14.3 billion visitors.
Youtube and social commerce
In the past, Youtube creators showcased products in their videos and added links in the video description - not very seamless. However, as of 2020, US creators can tag products from brands in their youtube videos and shorts using the shop label. US viewers can click labels in the youtube video, which will display the tagged products - allowing them to buy directly from the platform powered by Buy on Google.
While Youtube hasn't caught up with other social media platforms by offering this feature globally, users worldwide are still turning to Youtube for shopping inspiration. Capitalizing on this potential market, Youtube introduced live events in 2022, making global events shoppable for viewers. Plus, they've created a new shopping destination on the explore tab of the site, featuring shoppable content relevant to viewers in the US, Brazil, and India - rolling out additional countries later in the year.
What's next for this platform?
During Shopify's anticipated release of Editions in the summer of 2022, they announced a shopping integration with Youtube for creators and merchants to easily feature products on their youtube channels and videos. Now, merchants can link their Shopify store to their Youtube and, like the Instagram integration, benefit from Shopify's real-time inventory and product syncing feature. The US is still the leader in this feature, with merchants in the country able to create an onsite checkout so their viewers can shop and checkout on Youtube without having to leave the platform. We suspect both Shopify and Youtube are testing out how popular this feature is with customers and brands before rolling this out to merchants in other countries.
Other platforms for social commerce
Twitter and shopping aren't two words you would typically associate together – Twitter is the social media platform for news, insights, and short sharp content rather than to inspire purchases. In fact, Twitter states that 55% of people on Twitter get their news from Twitter, more than other social media platforms, and 83% of people on Twitter tweet about current events.
But in 2021, Twitter announced Shop Spotlight - a space at the top of Twitter profiles where businesses can showcase their products with a carousel of images. Users visiting the Twitter pages with this feature can click on products, learn more and purchase all within the app. Like Youtube, this feature (and Twitter's other shopping features) are only available in the US.
In late 2021, Twitter launched Live Shopping, and in 2022, launched Twitter Shops and Shopify's integration with the platform.
Live shopping, launched in Nov 2021, does what it says on the tin. Merchants can Livestream and attach shop tab's on the event page or include a shoppable banner.
Twitter Shops is an expansion of Twitter's Shop Spotlight. Rather than a carousel of products at the top of their page, merchants can create their storefront on the app, sell more inventory and create a more immersive experience for customers.
For Shopify's integration with Twitter, it's simple, Shopify merchants can access the Twitter sales app through Shopify Admin. This gains them access to the Twitter Shopping Manager connected to Shopify admin, automatic syncing of their inventory, and, of course, using Shop Spotlight or Twitter Shops linking products to their Shopify store for checkout.
Pinterest boasts 433million active monthly users, and as the platform for aesthetic and shopping inspiration, it has become the second largest source of social media traffic to Shopify stores. The app has successfully separated itself from the overly saturated social media market. Rather than based on sharing pictures of family and friends, Pinterest has a strong brand as a platform to create mood boards, discover new products, and purchase ideas.
To those unfamiliar, how does it work? Users, or 'pinners, can search tagged terms on the app, such as 'outfit with blue denim jeans, to which the platform responds by showing the pinner images related to their search. Once the pinner has found a style or image they like, they can pin it to a board for inspiration or click on links on the image, which lead them to website links where they can purchase jeans of that style and color.
Pinterest isn't a platform to be discredited regarding buying power. 93% of users use Pinterest to plan purchases, so user intent sets this platform apart from its social media counterparts. Their pinning feature allows customers to compare products from a range of stores before purchasing, and their buyable pins enable shoppers to purchase products directly through the app.
This is a great social media app for merchants if your brand uses visual storytelling and UGC to promote products.
Shopify merchants hoping to use Pinterest's curation and inspiration-based strategy can download Shopify's Pinterest app to upload their product catalog to the platform and offer in-app checkout. Shopify also provides the 'verified merchant program,' allowing brands to include a shop tab on their profile (similar to Instagram and Facebook's shops) and a merchant badge.
Don't get ahead of yourself
As we’ve discussed, social commerce is an ever-growing route to revenue, with continued investment from e-com giants like Shopify, the social media platforms themselves, and brands putting money behind their social shops. However, social commerce isn’t the answer to everything – e-commerce is still the most popular place to shop and continues to garner the most revenue.
If you haven’t got your e-commerce house in order first, don’t even think about setting up social media shops. Remember, with most of these integrations, Shopify allows brands to sync inventory, so if your supply chain, including warehousing and shipping, isn't up to scratch, you might cause more trouble for yourself later down the line. Furthermore, while customers might discover your brand and explore through social media shops, they will likely head to your main e-commerce store for further discovery. So, you want to ensure your user experience is in tip-top shape, or you could lose customers just as fast as you gained them.
If you'd like to learn more about how adding third-party integrations can enhance your Shopify Plus store, we'd love to help.