Social commerce is no longer the channel of the future. Any online retailer worth their salt simply must have a social commerce strategy in place. Put simply, it’s big – and it’s only going to get bigger.
Here, we discuss the rapid growth of the channel over the past two years, and explain how to fine tune your social efforts to maximise return on investment.
Why online retailers can’t afford to ignore social commerce
Three-quarters of UK adults own a smartphone, according to Ofcom. Government statistics show 63 per cent of adults used social media in the second quarter of 2016, although this figure is much higher for younger demographics (91 per cent among 16 to 24-year-olds; 89 per cent of 25 to 34-year-olds; and 75 per cent of people aged between 35 and 44).
In short, the opportunities presented by social commerce are clear to see. But it’s about more than just opportunity: a significant proportion of consumers actively want to buy through social channels. In 2014, the top 500 US retailers generated $3.3 billion (£2.7 billion) from social commerce, up more than a quarter year on year. And in the UK, YouGov and Bronto Software say the channel is worth £900 million to retailers. One in three UK consumers is eager to make purchases directly through social networks, YouGov and Bronto discovered, with the average buyer prepared to spend £55.68 on a single item.
These customers are happy to shell out considerable amounts of money, potentially without ever having visited your site. With so many consumers already primed to buy through social, this simply isn’t a channel you can ignore. Social commerce isn’t a phase. As with mobile commerce – which Juniper Research says will be worth more than $3.2 trillion by 2017 – online retailers that fail to invest in social commerce now will pay the price down the line.
Capitalising on the social commerce opportunity
In recent years, we have seen two key consumer changes, with online behaviour shifting rapidly toward social media channels and mobile devices. Understanding how the rise in these two areas has fundamentally changed the state of digital is vital for any retailer in this competitive marketplace.
Social advertising allows brands to cash in on the opportunities presented by social commerce. A healthy social ad campaign starts with understanding the value of organic vs paid, coupled with deep demographic data research. This allows you to gain a real understanding around the behaviour – or micro-moments – that your customers experience. Their purchasing motivations can be accredited to brand storytelling and timing, convincing a user to choose your brand over a competitor.
Consumers searching for a product are met with a persistent heavily personalised advert direct to their smartphone, via social mediums like Facebook and Instagram, where they are already frequently active. While the likes of Instagram, Pinterest and Twitter have an important role to play in driving sales via social, Facebook is dominating the market and should be at the forefront of your social commerce efforts. Facebook generates almost two-thirds of social media visits to Shopify stores, with an average of 85 per cent of all social orders coming from the site.
The value of social advertising
The ability to target a bespoke audience, and at the times of day they are most active online, means advertising on social media – and particularly on Facebook – often resonates better than traditional outreach. As consumers become increasingly savvy, this targeting becomes ever more crucial.
Simply creating social content in the hope that it will be seen is no longer effective. Now more than ever, your social efforts must be backed up by solid strategy. No brand can afford to enter 2017 without a social commerce strategy, because social plays an important role in increasing brand awareness and guiding customer purchases. Much of this comes down to having a paid social strategy.
In many cases, paid social ads are the only way to generate a return on investment from social. Your organic content often isn’t even seen by your community. On average, organic tweets now only reach around 10 per cent of followers. A Facebook page with over a million likes only averages around a 2.27 per cent organic engagement rate.
What makes a successful social ad campaign?
Several factors go into building a social advertising campaign to help you drive sales via social:
Strategy - Making sure you adopt a strategic approach to paid social media is crucial. Without it, you could risk incorrect targeting or wasted budget. A strategic approach should involve defining your demographic and scaling a paid social strategy that will convert your audience, while considering how to market your product and what the sales funnel looks like to ensure success.
Budget - Without stating the obvious, marketing investment is the first step to supercharging your social commerce campaign. Audience size and budget allocation are key considerations at this stage of the process.
Expertise - Social advertising should be a dedicated role, rather than an afterthought. Building successful campaigns is an iterative approach – you need to grow your understanding of what works well for your audience in terms of messaging, imagery, time of post, and many more factors.
Patience - Don't focus too heavily on your bottom line and fail to give the strategy the time it needs to come to fruition. Growing an audience for any brand is critical, and making sure you strike the right balance with new audience acquisition could make all the difference.
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