Social Commerce – the future of online shopping

Updated: Jul 27

There are currently 4.6 billion social media users around the world, equating to nearly 60% of the total global population. Social media usage has grown by more than 10 percent globally over the past 12 months – with 424m new users starting their social media journey during 2021.

Locally a whopping 82.7% of Australians are active social media users and on average are using 6.1 platforms every single month. For many people, social media is the entry point for everything they do online – from news to entertainment and communication. Social media has also become a destination for people to gain inspiration to shop and discover new products. ​

As brands increasingly leverage social to drive purchase outcomes, social media platforms are evolving to become eCommerce destinations in their own right, which is set to revolutionise the way we shop. ​


From social media to social commerce

Meta is on a quest to build the world’s largest shoppable social media platform, where billions of items can be bought and sold in one place. ​In 2020 Facebook (new Meta) began rolling out features like Facebook Shops, a mobile-first shopping experience where people can browse, explore and purchase products directly on Facebook, Instagram and WhatsApp. What's more, late last year Meta also rolled out new shopping features including Shops in Groups, product recommendations and a test of Live Shopping for Creators.


Along with Facebook Shops, Facebook also offers Live Shopping for brands, an interactive way for businesses to sell items, connect directly with consumers, and gain potential customers, all in real time.

But Meta isn’t the only one eyeing the eCommerce opportunity. Meta’s push into the sector has also been followed by other social platforms like TikTok (who have also begun embedding features to drive shoppability, including TikTok Live Shopping) and Pinterest (who have partnered with Shopify to drive shopability through the creation of shoppable Product Pins).


This is only the beginning for social commerce, as innovation is tipped to ramp up as social platforms seek to become a one stop shop for shopping, entertainment, and connecting with others.

Adoption by businesses and consumers


Looking to the future, the global social commerce market is set to reach $2.9 trillion by the year 2026, with growth predicted to be driven primarily by Gen Z and Millennial social media users, accounting for 62% of global social commerce spend by 2025.


The highest number of social commerce purchases globally are expected in beauty and personal care (40%), clothing (18%), consumer electronics (13%) and home décor (7%). Fresh food and snack items are also expected to be significant at (13%), but sales of these items are expected to be nearly exclusive to China.


For smaller brands social commerce presents a more even playing field. More than half (59%) of social buyers surveyed by a recent Accenture study said they are more likely to support small and medium-sized businesses through social commerce than when shopping through ecommerce websites. 63% of respondents also said they are more likely to buy from the same seller again, showing the benefits of social commerce in building loyalty and driving repeat purchases.


Currently, 90% of Australian businesses have a social media presence, however only 35% sell via social, and this is anticipated to change as these platforms continue to shift into the eCommerce space. In a way these platforms will be marketplaces in their own right, competing directly with the likes of Amazon, eBay and others. ​

So, what does this mean for brands?​

While social media has been utilised for years to influence purchase, social platforms shifting to be eCommerce powerhouses is still within its infancy. Brands playing within the eCommerce space need to be thinking about the role social commerce will play in their broader eCommerce strategy and be prepared for migration of audiences that are choosing to shop via these platforms. ​


Social commerce also increases competition for brands, with smaller players having access to the same tools and audiences as big retailers. Brands need to understand their customer better than ever and put forward a compelling offer that cuts through the noise in market.


When it comes to social commerce, there are a host of benefits including tapping into a large captive audience. However, brands will need to weigh up the pros vs the cons of leveraging social commerce within the platforms themselves as driving conversion (i.e. browsing behaviour), impact a brands ability to drive cross-sell and upsell of their own product in the basket, and could also train consumers to buy through social rather than frequent their own stores.


Does your organisation need help in building a compelling eCommerce strategy? We can help! We work with some of Australia’s favourite brands to develop robust and stress-tested strategies to drive growth in digital transformation, eCommerce, MarTech and more. Get in touch with us to chat about how we can help!

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