Key Considerations for your Social Commerce Strategy

Ruth Peters
July 20, 2022

We’ve said it before, and we’ll say it again: shopping isn’t the same as it once was.

Social commerce is the next iteration of retail. From brick-and-mortar stores to traditional eCommerce… and now, social. 

Almost all social networks allow customers to buy directly through their platforms, and with 4.65 billion social users, the opportunity for brands is undeniable. If you can get it right, that is.

Social commerce isn’t just about getting one-off sales through a one-hit-wonder TikTok live though. It’s about using this new approach to commerce to engage new users, direct them to your website, and then keep them on board as loyal customers. 

It’s not easy. But with the right social commerce strategy in place, it’s possible. Let’s dive in.

Dig Deeper >  3-minute read 

What does the social commerce landscape look like in 2022?

A decade ago, online shopping was still something of a novelty. Now, it’s the status quo. We can only predict that social ecommerce will follow suit. 

According to eMarketer, retail social commerce sales totalled $27 billion in 2021. That figure is expected to more than double in 2022 when total sales are projected to hit a whopping $56 billion. The opportunity is undeniable. 

Around half of all US adults made a purchase via social media in 2021 –– a percentage that grows among Millennials and Gen Zers. In fact, by 2025, 62% of global social commerce spending will come from these two generations. 

Brands have woken up to the massive marketing opportunity that comes from social commerce, especially now as we enter into the Web 3.0 era and the Metaverse becomes ever more mainstream. Eight in ten US retailers plan to start selling on social media in the next two years.

What does this mean for brands?

With the rise in social commerce, we’ve moved away from the traditional ecommerce funnel.

Consumers used to start and end their user journey on the brand site, but now they’ve shifted to starting (and occasionally completing) their shopping journey on social media — at ‘the edge’. 

We’ve always known that brands need to be where the consumer is… and with social commerce, that’s become easier than ever. Any brand worth its weight is already investing a hefty chunk of its marketing budget in social media — the CMO Survey found that 22.4% of a B2C product marketer’s marketing spend was going toward social in 2021, with a predicted 25% being spent on social in 2022.

This tells us that brands now acknowledge the potential of social commerce to attract new customers and are beginning to invest significantly to raise their profile on social platforms. 

The shift to social commerce has to be easy for the customer — or they just won’t do it

Building a seamless shopping experience has its challenges. According to ‍SimplicityDX's State of Social Commerce report, over two-thirds of shoppers want to discover brands on social, but still want to shop directly on the brand site. Getting them there seamlessly is the key part. 

79% of global consumers believe that the experience a company provides is just as key as its products. Brands need to turn their focus to using social media as a discovery tool, and optimizing their social promotions and inventory interactions to provide shoppers with the best possible journey to the brand site.

This leads us nicely into…

How can brands optimize social commerce strategies?

Let’s go through some strong, actionable ways brands can jump right into a seamless social commerce experience for their customers –– and their tech teams!

  1. Create a consistent omnichannel shopping experience 

The keyword here is omnichannel

Every consumer is different –– if you’re going to meet them where they already are, you’re going to need to be in a few places. Yes, you’re focusing on social, but don’t forget about the transition to your online store. Is the product you’re advertising in stock? Is the link returning a 404? Think carefully about your answers, because 98% of consumers have experienced an out-of-stock problem when visiting a brand site from social.

Consumers interact with brands across an average of 7.6 different touch-points before purchase, so each should be connected, seamless, and deepen the relationship further. 

  1. Know your customer and choose the social platform carefully 

As all brand social media managers know, your audience differs widely across different social channels. You tailor your social strategy for each platform, so why wouldn't you also tailor your social commerce strategy?

Audiences aside, Meta, TikTok, and Pinterest — the three main social commerce platforms — all have their own strengths and weaknesses depending on your brand and what products you’re selling. 

Obviously, Facebook is the biggest social commerce platform in the US, boasting 56.1 million buyers in 2021. While Instagram doesn’t have quite the same reach, it’s a more popular choice among younger audiences, and its Shopping tab is particularly good for reaching new customers.

Pinterest has significantly less engagement than Facebook shopping, but it’s a platform entirely built around inspiration and wishlists, making it a key purchase channel for brands. It also notes 85% bigger baskets than shoppers on other platforms, so a great option for higher order values. Pinterest’s shopping features are particularly useful for brands in interior design, fashion, and health & fitness spaces. 

TikTok shopping is new, but what it lacks in experience it makes up for in power. TikTok is the place to be if your audience skews young and if you have had success with influencer campaigns in the past. 

  1. Know when and when not to use Social Checkout

There is no one-size-fits-all approach to social commerce. Social Checkout is the newest approach to social shopping, but it’s not necessarily a good idea for every single brand. 

It allows shoppers to find your brand, browse your shop, and make a purchase, all without ever leaving the one app. If your brand is just about to launch, you already have lots of followers and plan to go to market through influencers, then launching it on, say, Instagram first could be a really smart move. Social commerce is also very successful when used in conjunction with influencers and live shopping, as it provides a seamless experience during an event.

However, there is one major drawback. Social Checkout leaves all your customer data in the hands of the platform. When customers use the one-click social checkout button, you’re missing out on gaining valuable insights like browsing history, contact details, and demographics.  

In our research on eCommerce Profitability, we concluded  that escalating customer acquisition costs place a renewed focus on collecting first-party data. Driving repeat sales through targeted marketing, such as e-mail campaigns and targeted ads, is the key to getting return customers and profitability by maximizing lifetime value.

What we’re saying is that  it’s important to consider your brand goals and your existing social presence before setting up that Social Checkout button. And, as a final note, our research on the State of Social Commerce highlighted that 71% of shoppers preferred to discover on social before  buying on the brand store. So as well as considering the lost data and the route to eCommerce profitability, you would be wise to consider customer preferences, too.

  1. Leverage social proof, UGC, and influencers

Social commerce and UGC go hand in hand. There’s no better way to show off your products than by sharing content from happy customers: people are six times more likely to purchase a product if they can see pictures on social media from existing customers or influencers. 

About 92% of customers trust the reviews and recommendations shared by people, rather than advertisements.

The key to a successful social commerce strategy is to incorporate visual and actionable social proof. Perhaps that’s a carousel lookbook on Instagram featuring tagged photos of your products, which users can tap on to shop in-app. Or maybe it’s a paid collab video on TikTok with influencers who have already interacted with your brand on the platform. 

UGC is free marketing content for you –– and social proof is a killer way to boost your social commerce performance. 

  1. Keep optimizing 

You simply can’t approach social commerce with a ‘set it and forget it’ approach. 

The shopping experience has shifted to the edge in recent years, meaning customers are finding products on social media more and more frequently. For businesses, this means ensuring these users can get from the edge to your Shopify store without any bumps in the road. 

Our recent report State of Social Commerce shows that 81% of customers complain of poor landing experiences when referred by social channels. Clicking through to the brand site from social is a very hit-and-miss experience. Product inconsistencies, broken links, inventory issues, and an overall disconnected experience are commonplace, as shoppers transfer from a rich social environment to a functional product detail page.

If not properly optimized, the product detail pagecan be a major revenue leak for traffic from the edge. Indeed, our research shows that 14% of eCommerce site revenue is lost due to poor landing experiences. To fully optimize the landing page you need to connect social data, experience data, and inventory data together, to provide the alerts and insights needed to optimize eCommerce landing pages on the fly.

There’s more competition for shoppers’ attention than ever before. Your site needs to constantly improve to meet their needs and keep them engaged — and that means optimizing shopping experiences in every single place where those customers are making purchases. 

        6. Profitability has to be the number one priority for a social commerce strategy

Remember that CMO Survey stat we shared above: are you comfortable with a quarter of your marketing spend failing to deliver ROI? That’s the sort of performance you’ll be faced with if your social commerce channel is unprofitable. 

As mentioned, our research on eCommerce Profitability shows that customer acquisition costs are rising and hurting profitability for brands. On average, Merchants are now losing $29 for every new customer, compared with $9 in 2013 — a 222% increase.  Essentially, every time a customer purchases through a social network, brands will lose $29, setting up a perpetual cycle of unprofitable sales.

Moreover, the study points to estimates that acquisition costs have risen by 60% in the past five years. And marketers have been affected by such complications as these:

  • The introduction of iOS 14.5
  • The demise of third-party cookies
  • Increased consumer privacy legislation such as CCPA and GDPR

Make a profit goal the center of your strategy and stay focused on that. Perhaps your first sale isn’t profitable, but the subsequent ones are. With that in mind, your focus should be on engaging your customers on social media and directing them to your brand site to capture their data. Keep your eyes on that prize. 

One of the best ways to boost your profit margins is to constantly keep an eye on your data. 

Capturing in-depth customer data (more than just age and location) can go a long way in helping you get from that first purchase to the second one, and then build an ongoing relationship with the consumer.

A consistently excellent customer experience is the essential key to achieving profitability

That’s where we come in. 

SimplicityDX makes social commerce work. Its SimplicityDX Edge Experience Platform enables brands to optimize social commerce experiences by simplifying the buying process between journeys started at the edge and the brand’s eCommerce site. Founded by a team of industry veterans in May 2021 and privately funded, SimplicityDX operates in the U.S. and U.K. markets. 

Visit www.SimplicityDX.com or connect with us on LinkedIn.

And for more information on social commerce, be sure to check out SimplicityDX's State of Social Commerce report.

FAQs

What is a social commerce example?

One example of social commerce would be when a shopper purchases goods or services via a social platform such as Facebook, Pinterest, Instagram, TikTok, and so on. That said, we believe the most profitable and user-friendly approach to social commerce is to begin the discovery process on social before navigating the shoppers to the brand site in order to check out.

What are the types of social commerce?

There are a number of different types of social commerce, including shopping via “Shop now” links on a brand’s social media profile, Social Checkout, video-based selling, influencer marketing, and user-generated content.

What is the goal of social commerce?

Ultimately, the goal of social commerce is to make sales for the brand. The worry is, that if shoppers check out on social — rather than on the brand site — you miss out on valuable data and opportunities to re-engage.

How does SimplicityDX define social commerce shopping?

At SimplicityDX, we have discovered a clear preference for discovery on social and checkout on the brand site. As a result, we argue the definition of social commerce needs to be widened to encompass: a person’s end-to-end social shopping experience, which includes discovery on social and concludes with social checkout. And also discovery on the the social media platform and transfer to the eCommerce brand site for checkout.

Read more about the emergence of social commerce and what it means for your brand.

Shopping at The Edge – The New eCommerce Reality

Promotions at the edge: how promotions cause eCommerce shopping experiences to break

Social Commerce for Retail?

Social Commerce and the Peak Shopping Season

SimplicityDX Publishes 2022 State of Social Commerce Impact Study

Watch the Webinar - Social Commerce is Broken: How to Fix it

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