Now is the time for social commerce to shine

By: David Coombs

20th April 2020

The ongoing coronavirus pandemic is impacting every part of our lives, and with social distancing keeping people at home, we’re seeing shifts in behavioural trends. People are returning to broadcast TV, and looking for new ways of entertainment, escapism and exercise.

People are also changing how they spend their money, especially when it comes to ecommerce sales. A new Kantar study covering Europe’s three largest e-commerce markets — France, Germany and the UK — shows that the share of consumers purchasing more than half of their shopping online has increased between 25 and 80 percent since the outbreak of Covid-19.

Better yet, six out of ten consumers say that they will continue to buy as much online as they do today after the pandemic has passed.

This is a huge opportunity for brands who can serve a robust digital offering to their customers during this time. What’s even more interesting with this trend is how it pairs with the increased use of social media platforms during lockdown. The line between social media and e-commerce is increasingly becoming blurred; social channels dominated by user-generated content have embraced the transactional side to become booming marketplaces.

Social commerce has a great success story in China, where consumer-oriented innovations are developing at breakneck speed and mobile payment tools, like QR codes, facilitate quick and easy transactions, prompting consumers to make more purchases than before.

And as with many Eastern trends, this move to social commerce is being picked up by younger Westerners first. With Gen Z set to represent 40% of consumer spending by the end of this year, they are the ones driving new shopping habits. Along with younger millennials they are determining what is trending and therefore what is driving demand. These younger audiences spend huge amounts of time on social apps so it is no surprise social commerce is rapidly growing in this demographic.

Another driver of social commerce is the growth of short form content and sharing of this content across social media platforms. Influencers, for example, are great accelerators of this content across platforms. They’re helping further drive the growth of commerce sales across social media, and the influencer industry is on track to be worth up to $15 billion by 2022.

For example, L’Oreal have been experimenting with using influencers to sell on social platforms, defining them as ‘super sellers’ and also investing in technology Modiface that provides tools like VR for people to try on new makeup from home.

Most recently since the pandemic, outdoor brand Dakine are spotlighting how its influencer athlete partners are keeping busy at home. Since mid-March the brand has already seen solid results from leveraging this type of content: website visits from social sources are up 26 per cent.

And we know that the younger generation prefers short form video rather than conventional static content further reinforcing platforms like Snapchat, TikTok or YouTube as go-to destinations for all types of activity including shopping.

These platforms are reacting to the demand and enabling more and more direct commerce opportunities within their formats and content. Instagram has been particularly good at improving on its commerce capabilities; users can now buy a product that they see scrolling through their feed without ever leaving the app. ‘Newcomer’ TikTok is also testing a similar feature, which shows the demand for commerce capabilities on even the latest social media apps.

But social commerce has to be more than simply adding a “buy” button on social media posts – it’s about social interaction and user-generated content becoming integral parts of a consumer’s shopping journey. And during this time of isolation, connection and interaction between consumers and the brands they love is ever more important. As more consumers are avoiding crowds and further lockdowns take place around the world, all types of digital commerce will see an increase in demand and social commerce has a chance to really shine.