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Increase sales through social commerce (AKA - Sell on Social Media)
March, 11 2021
Almost every brand has leveraged social media as a marketing tool. In social media marketing, we focus on redirecting the engagement to an e-commerce platform or in-store. This redirection itself is an added step to the sales funnel and could result in a lost conversion. Why direct your leads towards a complex purchase journey when you can sell directly on social media? This article will explain how you can benefit from selling directly on social media.
What is Social Commerce?
The idea of social commerce is to offer your customers the opportunity to checkout directly on social media platforms. WeChat introduced eCommerce functionalities to their platform in 2013 and it was followed by:
Facebook introducing Facebook Buy Now Button in 2014.
Pinterest's Buyable Pins in 2015.
Instagram Shop Now Button in 2015.
Since then, more features have been introduced to streamline the purchase journey, reduce frictions and improve conversions. Although it started in 2013, 2020 was the year that social commerce became the buzzword of e-commerce. Because of the pandemic lockdowns, sellers were forced to sell online. Small sellers who don't have any online presence found social commerce as a cost-effective solution to sell online. Even for a brand with an established online presence, Social Commerce is an opportunity to improve sales.
Why sell on social media?
Social media is a powerful tool to have a one-on-one interaction with your customers. According to some research findings;
~23% of shoppers are influenced by social media recommendations (Big commerce)
~84% of shoppers review at least one social media site before purchasing (Pew Research Center)
~22% of the shoppers think that they find it easy to shop directly on social media. (Bigcommerce)
There are other advantages of selling on social media such as;
The market size - Most brands already use sales channels such as Amazon, eBay, Etsy to sell products online. Amazon being the most popular market place, it has ~197 million active monthly users. If you compare this with the social media giant Facebook, FB has 2.4 billion monthly active users. One can argue that users don't log in to Facebook to buy products, but the potential of FB as a marketplace keeps growing as we speak. On average, a user spends 144 minutes per day on social media so doesn't it make sense to meet your customers where they are most active?
Powerful social signals - According to research findings by Fan & Fuel, 97% of shoppers factor customer reviews into their online purchase decisions and they consider the authenticity of those reviews. Authentic customer reviews can result in an 18% uplift in sales. There's no other place like social media to capture and reflect customer reviews, likes, comments and shares. These social signals are not only powerful, they are presented in a personalised manner. Let's say you find a brand for the first time on Facebook, FB will tell you the number of friends who have already interacted and recommended that brand. Social signals are a key influence when making purchasing decisions.
An app like user experience - Social media giants have resources in place to understand user behaviour and optimise their platforms to gain more engagement and drive conversions. This makes the user experience more streamlined, frictionless and faster. Especially when you don't have the resources to invest in an eCommerce mobile app, leveraging what they offer is important.
Streamlined checkout process - Did you know that ~29% of first-time shoppers will abandon cart checkout if asked to register? Lack of trustworthy payment options and a lengthy checkout process could also result in lost conversions. Social media checkout solutions are fast, trustworthy and simplified. For example, buy now buttons can fast-track the checkout process by retrieving customer data, shipping data and payment details from the customer's social media account. Automated messenger bots like Facebook Live Chat and Many Chat can assist customers with instant replies. By integrating AI chatbots like Jumper AI, you can automate the checkout process via chat and voice commands.
Higher conversion rate - Instant messaging features on social media makes conversions, retargeting and upselling easier. The following is an example of the conversion rate between Messenger Vs.Web+Email. According to the data, the Messenger conversion rate is 35 times higher. (source - BigCommerce)
Comparison between Messenger marketing vs web + email marketing
User-friendly setup - Setting up a Facebook shop, Integrating your payment details is a user friendly process that doesn't require any coding skills. It doesn't cost you to list products on these platforms and some platforms have waived their transaction fees to support small businesses during the pandemic.
What features do they offer?
In May 2020, Facebook introduced Facebook Shops as its newest e-commerce feature. With this, shoppers get to create an online store and list multiple catalogues which are called collections. To manage these shops, FB introduced Facebook Commerce Manager. With Commerce Manager, you can;
Brand your shop by changing the layouts, colours and call to actions.
Share permissions with your coworkers to manage your shop.
Create products and catalogues with multiple variants such as colour, size and material.
Review catalogue insights.
You can even link those shops with an Instagram page and start selling on Instagram. Selling on Instagram will allow you access to a few value-added features. You can use instant messaging apps that are integrated with Facebook (Messenger, Whatsapp, Instagram Direct) to communicate with customers, share order tracking details and even proceed checkouts with third-party integrations (Jumper AI). Even though Facebook Shops are free, You have to submit your shop for verification before publishing it. This verification makes sure that your shop is aligned with Facebook community guidelines.
Instagram is a platform that connects its community through creativity and visual-heavy content. Once you understand how to combine your products with creative content, selling on Instagram becomes easier. You don’t have to create separate catalogs on instagram as you can mirror the catalogues that are available on Facebook shops. Instagram has some interesting features that drive conversions.
Shoppable posts and product tags - You can create image content on Instagram by highlighting the products that are featured in the image. Once a user taps on the image, they get to see the basic product details such as product name and price. By clicking on that tag, they can visit the Instagram shop and buy products directly on Instagram. These tabs can be applied to Instagram stories as well.
Branded Content, Collabs Manager & Shopping from Creators - Instagram has introduced these tools to utilise the power of influencer marketing. According to the influencer marketing giant Hashtag Communications, ROI of influencer marketing is generated at 15x the investment. Branded content is a way that influencers can register with your brand and tag your brand in the content they create. Once they tag you, you get to see real-time insights of how their audience engage with your content. Collabs Manager is a platform run on Facebook where you can find and analyse insights of your influencer campaigns. The platform helps you to explore influencers, analyse their performance and communicate with them regarding brand collaborations. Shopping from Creators is a tool where brands can give access to the influencers or creators to tag their products. With this, influencers can create shoppable posts for brands in the form or Instagram grid posts, stories or wish lists.
Instagram - shop from creators
Instagram Watch and Shop - Videos are a powerful tool that can drive conversions. According to research by Hubspot, ~84% of customers are convinced to buy a product after watching a product video. Instagram Watch and Shop is a way that you can tag products that are available in a video. This could either be a how-to video of that product or a lifestyle video that showcases the product.
Instagram Live Shopping - The newest feature of Instagram shopping is Live Shopping. With this feature, brands or collaborators can add up to 30 products before they go live. During the live session, they can pin these shoppable product tags on the screen one at a time. The audience can checkout or save those products while enjoying the video.
Pinterest is a social platform that helps users to find and organise their interests in the form of pictures, links and videos. Users can create boards and add pins to it whenever they find something interesting. It’s similar to save a product link for later reference but in an interactive manner. Commerce version of Pinterest is called shoppable pins and shoppable pins allow you to buy things that you see in those pictures or videos directly on pinterest or direct you to an ecommerce checkout page. If you have creative, organic or hand made products, Pinterest Shoppable Pins are a great way to sell.
It's clear that social media will continue to provide innovative ways to sell. Business Insider forecasts a ~34.8% growth in retail social commerce sales in 2021. Even though it's a promising solution to sell online, social commerce is not yet the solution to sell high ticket items. The average order value of Instagram Shops sits at ~$66 USD. The best current practice would be to sell low-cost items on social media and to build trust so that you can encourage them to purchase higher value items on your website.
2021 is a decisive year for all businesses. Retailers in particular, need to make sure that they utilise every possible sales channel available. Social commerce has to be at the heart of your eCommerce strategy and Maytech can help you link all your social commerce channels to your website so that you can:
Manage your social media marketplaces from a single backend.
Retarget and remarket leads that are generated through social media.
Simplify the checkout experience through integrations like AI bots and Checkout bots.
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