Bringing the Social to Online Shopping – Three Trends to Watch in E-Commerce

Brands would be wise to reexamine online shopping as an alternative purchase channel as well as a place for meaningful interactions, write Elizabeth Shie & Sarah Huang

Bringing the Social to Online Shopping – Three Trends to Watch in E-Commerce

Brands would be wise to reexamine online shopping as an alternative purchase channel as well as a place for meaningful interactions, write Elizabeth Shie & Sarah Huang

Social commerce —selling products and services directly to consumers through social media — has been a growing sector of e-commerce, particularly in the APAC region. In the first half of 2021, the overall growth of social commerce gross merchandise value (GMV) nearly doubled YoY in the region, led by Malaysia (up by 207%) and Philippines (up by 74%), per 2021 data from iKala.

Beyond scale of share, the high frequency in which shoppers engage with social commerce points to exciting opportunities for brands to reach consumers along these touchpoints in social networks.

In 2022, social media penetration stands at an all-time high of more than 80% in APAC countries, according to estimates from We Are Social. Driven by pandemic shopping behaviors, social commerce has emerged as a force in ecommerce.


 

Social commerce fills the social experience gap in ecommerce. Offline shopping is inherently a social experience, as friends and families often visit malls together just to hang out. While convenient, ecommerce sites are not designed to provide casual experiences like window shopping. Social commerce bridges consumers’ preference for a social shopping experience with convenience.

“How often do you shop using social networks?” (Source: iKala, 2021)

Within native social media experiences, social commerce replicates the entire journey — discovery, consideration, and conversion — in an authentic and personalized way. Even as the world begins to re-open to in-person experiences post-pandemic, trends such as livestream shopping, community-to-commerce, shoppable ecosystems, and social commerce innovations are here to stay.

Livestream shopping

In 2021, consumer interest in livestream commerce was highest in the APAC region, compared with the global average. Fueled by the pandemic, retailers were pushed to deliver digital solutions that kept consumers engaged while bridging the physical gap.


 

Those solutions are now endemic to both retailers’ marketing and shoppers’ behaviors. Retailers turn to social media platforms such as Instagram and TikTok live to reach shoppers in interactive sessions. Models describe and try on clothes, and just like the in-store experience, shoppers can ask questions in live sessions. Friends join live streams together, replicating the social shopping experience.

Last December, Singaporean veteran Getai singer Wang Lei closed sales worth more than 1 million Singaporean dollars in under two hours during his livestream from the Paris Gucci store.

Further, gamification and shoppertainment make livestreaming an emotional experience. Brands hook shoppers in with contests and shoppertainment provides an additional leg up. Last year, Pepsi launched Blackpink x Pepsi,i which was a gamified event hosted by influencers. It drove brand engagement and sales to an all-time high.

Livestream commerce also democratizes selling for smaller brands, enabling them to reach mass audiences. Last December, Singaporean veteran Getai singer Wang Lei closed sales worth more than 1 million Singaporean dollars in under two hours during his livestream from the Paris Gucci store.

The rise of livestream commerce has created opportunities for brands to rethink the role of influencers. Consumers today look for authenticity in branded activity and may even display a distaste for highly curated content. Livestreams present a delicate balance between authenticity and brand engagement.

Community-to-commerce

Communities thrive due to shared interests on social media which enables easier discovery of products and services vouched for by like-minded people. And with the wider adoption of ecommerce, discovery conveniently converts to sales.

Case in point, TikTok’s algorithm feeds content based on the user’s preferences. The hashtag #TikTokMadeMeBuyIt already has 17.8 billion views globally. And nearly four in 10 users who discovered something on TikTok immediately went to buy it, TikTok claims. Facebook Groups have also become a place of discovery and action, with members sharing their experiences along with links to purchase.

“Brands will need to reexamine online shopping as an alternative purchase channel where not only is convenience king, but it is also a place for meaningful brand interactions that drive discovery, consideration, and conversions.”

Moreover, there are many apps that were built for community-to-commerce. In China, the app Little Red Book —also referred to as Red—is dominated by user-generated content from young women. Brands can tap into Red’s influencers to promote their products. Perfect Diary, a fast-growing brand in China, has built its success through the use of the app. For the promotion of new products, Perfect Diary will invite millions of fan key opinion leaders (KOLs) to share related content on the Red to create momentum.

Community-to-commerce translates the power of influential recommendations into purchase. Rather than rely on ads where the brand speaks to consumers, community-to-commerce creates an opportunity to let the community speak for the brand online to amplify awareness, consideration, and sales.

Shoppable ecosystems

The impact of livestreaming and community-to-commerce is amplified by ecosystems. Platforms have started aggregating paid, owned, and earned channels by offering ecosystems of shoppable media for brands to reach their objectives.

This was pioneered by tech giants in China. For example, having a storefront in TMall (part of Alibaba) gives the brand access to TMall’s resources within the ecommerce platform such as livestreaming, KOL partners, and display ads. It also enables the brand to tap into the larger Alibaba ecosystem of apps such as Weibo and Youku, further broadening the customers that can potentially be reached.

“Livestreaming, community-to-commerce, shoppable ecosystems, and other innovations will continue to evolve to make online shopping more engaging and entertaining.”

Meta is following suit by allowing brands to have a storefront within the Facebook or Instagram page and offering a suite of shoppable formats that can be advertised on-platform where the shop is and broadcasted throughout the Meta family of apps and its ad network.

When planning for social commerce, brands will need to view their activations more holistically throughout the ecosystem rather than having tactical one-offs.

Social Commerce 2.0

Beyond shoppable ecosystems, brands have continually innovated to keep social commerce engaging. Accelerated adoption of technologies like virtual and augmented reality further blends our physical and social worlds, giving consumers access to immersive online shopping experiences.

The Chinese market led social commerce innovation. As early as 2016, Taobao launched its VR Shopping Buy+ program where shoppers can interact with people and products in a 3D shopping environment. In 2022, Taobao launched its first-ever “Metaverse Mall” for China’s annual 6/18 Shopping Festival. Consumers can guide their avatars through 3D stores and interact with various activities through their phones.

Other APAC countries have also stepped up their social commerce game. Afterpay launched Invisible Drops, where Australians and New Zealanders can discover exclusive product drops on a shoppable AR experience.

Social commerce is rapidly evolving, and APAC consumers have been at the heart of this adoption. Livestreaming, community-to-commerce, shoppable ecosystems, and other innovations will continue to evolve to make online shopping more engaging and entertaining.

Brands will need to reexamine online shopping as an alternative purchase channel where not only is convenience king, but it is also a place for meaningful brand interactions that drive discovery, consideration, and conversions.

 

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