Raj De Datta is its CEO Bloomreacha platform that personalizes the e-commerce experience and the author of “The Digital Seeker”.
Social media has long shaped consumer shopping habits, but recently, its role in the purchase journey has taken on new meaning for brands and retailers. Social commerce—the fusion of content and commerce—is rapidly expanding e-commerce capabilities beyond traditional web and app channels.
Expected to hit a Market value of $1.2 trillion by 2025, social commerce allows businesses to sell products and services directly on a social platform (indirect social commerce also allows businesses to drive shoppers to their website through social content). With almost 5 billion users worldwide, this is a unique opportunity to create direct connections with customers and secure significant revenue.
Social platforms are well aware of how enticing this potential is for businesses. TikTok is reportedly aiming to increase its US e-commerce volume tenfold $17.5 billion by 2024. The launch of the TikTok Shop has garnered mixed reactions from businesses, but in a Research on consumer trends from The New Consumer, 69% of TikTok users surveyed said they would be willing to buy something from the platform. Others are taking proactive steps to facilitate social selling, such as Pinterest, which introduced one API for shopping which includes additional catalog and metadata management capabilities to enhance product information.
With such huge potential and buy-in from the platforms themselves, social commerce seems like an area every e-commerce business should focus on. But why is it? now the right time to invest in this strategy—and what might stand in the way of success?
Trust challenges
The trust challenges of social commerce remain one of the biggest obstacles for businesses adopting this channel. Despite the increasing amount of time consumers spend on social media and the data they share to make that experience more enjoyable, sentiment is changing when it comes to purchasing.
Almost 4 out of 10 customers hold back from social media purchases due to concerns about how the platforms handle personal data. While they may discover a product on a social media platform, consumers often navigate outside of the social media platform to a trusted brand’s website to make a purchase. This additional step in the purchase journey creates more opportunities for customers to abandon their purchase altogether.
However, this trust gap can change over time. Even amid concerns today, many platforms are still seeing incremental purchases, showing that consumers really want to embrace this channel.
For older generations of shoppers, trust will likely grow as bigger brands begin to embrace social commerce. An Accenture overview found that this generation of buyers values safety and brand familiarity – two areas where name brands can deliver. Younger generations, meanwhile, trust shopper reviews more. Brands that can provide consistent value—which will include transparent returns and refunds—can gain trust even without a big name, as customers share their positive experiences with others.
AI opportunities
Despite the trust challenges facing social commerce, there really has never been a better time for businesses to take a serious look at their social strategies. While social commerce has been around for some time, it is the latest innovations in artificial intelligence that give businesses the best chance to succeed in this channel.
AI offers significant advantages in three key areas of social networking: scale, discoverability, and engagement. Here’s how they could come to life on different platforms:
• Instagram: For businesses with smaller marketing teams, developing social strategies and content can be a huge undertaking. However, Generative AI can take on much of this work. On the creative side, it can enhance product photos to better grab attention visually. For post descriptions, genetic AI can write content that matches both brand tone and customer voice.
And of course, it can do this for an entire week’s worth of posts in a matter of minutes. While brands may not be ready to share these posts blindly, it provides a strong foundation of a scalable social strategy for time-strapped teams.
• Tik Tok: With a strong understanding of their customer data, a business can use AI to maximize the discoverability of their content on TikTok. After determining their high-value customer segments, businesses can use AI to create hashtags and descriptions that are more relevant to the audience they’re trying to reach. Adding these layers to a post can give the algorithm a better understanding of who that content is intended for, increasing your discovery of key audiences.
• After: With 2.9 million monthly active users, Meta offers no shortage of customer engagement opportunities, particularly as customers start conversations through comments. But today, it’s impossible for businesses to really engage with every customer comment, which can turn off shoppers who were looking for additional guidance before making a purchase.
But soon, genetic AI will offer some conversational use cases that will enable this level of engagement. This could well include shopping assistants that can respond to customer feedback and offer one-to-one guidance, at scale, on social platforms like Meta.
The Opportunity Ahead
The shopping journey has evolved over the years to meet customers where they are. From the store to the web, commerce has continued to adapt to new channels and new ways of reaching customers. Social commerce is another extension of this, moving shopping into a channel where consumers spend an increasing proportion of their days.
Just as businesses couldn’t ignore the early days of e-commerce, they can’t ignore this new shift in social channels. Consumers may still be hesitant to spend directly on social media platforms, but that trust will evolve quickly. The earlier businesses can explore this channel—and where AI can enhance their efforts—the better off they’ll be when customers are ready to shop.
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