Social commerce is the e-commerce transactions in realtime, leveraging social media networks and within the apps. Social commerce stems from early features around peer-to-peer platforms, e.g., the early versions of Marketplace by Facebook in early 2000. It has started to gain traction on major social media platforms in recent years. Some notable examples include Instagram's Checkout, Facebook Shop, WhatsApp Catalog, and Pinterest Pins.
Traditionally, social media platforms were mainly leveraged to raise brand awareness, provide shopping ideas, influence purchasing decisions, and direct the traffic to the official websites or third-party platforms (e.g., Amazon.com) for customers to place an order.
Social commerce makes it possible that customers, when attracted by certain products while browsing their social media feeds, could place an order within the app in real-time. In this way, it saves time for customers to switch apps, sign in, and check out, and customers are more likely to complete the purchase instead of abandoning it on second thoughts during the traditional lengthy process. Social commerce also drives user stickiness and retention for social media platforms.
Challenges exist on its way to become the "next great thing". Customer adoption is a major one. The social commerce boom has been driven heavily by the younger generation, according to a study by MarketingWeek. The percentage of willingness to buy through social commerce is at its peak for younger generations (18- to 24-years-olds) and drops extremely quickly for elder age groups. Such observation is partly a result of the product catalog currently available on social commerce, mainly apparel, accessories, makeup, home, etc. Therefore, how to increase the adoption of social media in other age groups and broaden the product catalog available for social media are key questions to answer in order to make it the next great thing.
No comments:
Post a Comment