Social commerce

Social commerceis the use of social media to sell products to consumers. Social commerce, which has become an important part of digital marketing, has become more prevalent as the use of social media has increased. Social commerce can take on many different forms, including the use of commenting features so consumers can provide feedback about their purchases, the use of advertising and selling goods directly on social network platforms, and the sharing of coupons and discounts via social media messages. Social commerce remains a relatively small part of the overall economy, but its influence is constantly increasing, and companies are regularly creating and using new methods of using social media in commerce.

Backgrounds

Social commerce relies on social media, but the term social media is often broadly defined. Social networks—such as Instagram, Twitter, and Facebook—are extremely common social media outlets that allow users to generate their own content and publish their own ideas or media. Other types of social media also allow users to incorporate user-generated content (UGC). Social media also includes message boards, blogs, online public-facing polls, user-generated questions, and more. In social commerce, advertisers and brands use all these various media elements to promote and sell products.

Social commerce takes place in a number of different ways, but among the most common is promoting brands and closing sales. That means that brands often take part in social commerce campaigns, during which they use different social media tools to advertise their products or services, to engage prospective consumers, and to promote the brand’s story. Success in social commerce campaigns can be measured by the number of sales a brand receives from a specific campaign. But, it can also be measured by engagement, which means the number of times users on a platform engage with, share, or “like” certain messages and elements of a campaign.

Overview

Social media allows consumers to take part in activities that relate to social commerce. Social media, including social networks, encourage users to share content, in the form of ideas, messages, opinions, and media (such as pictures and videos). Consumers often share their ideas about particular brands and products through social media. Positive reviews and posts about certain products or brands can boost sales and increase the popularity of a particular brand. Although such posts and engagements are often organic, some companies also pay people known as "influencers" to post on their behalf, engage with the company's brand, or manufacture other content, often with the intention of appearing organic. Brands try to find many different opportunities for people to create UGC that promote their goods and services.

Social commerce is also related to other advancements in commerce that have developed because of changes in technology. For example, the sharing economy—which enables people to share their homes via tools such as the Airbnb app and share their vehicles via tools such as Uber’s app—has allowed people to share their personal goods as well as their personal style with the outside. This openness to inviting people into one’s personal life can also encourage openness in sharing one’s opinions about brands and purchases. In this way, social media is encouraging the democratization of marketing and branding messages. Just as brands share their styles, stories, and beliefs, consumers can do the same.

Studies have shown that UGC has become one of the most important tools for social commerce. UGC can include user posts about specific information, but it can also include feedback that is generated through comments sections and reviews on specific product pages. Brands, which benefit from UGC, take many steps to increase UGC. One important way is to use influencer marketing; companies will often pay influencers or give them free products in exchange for the influencer writing or posting about the product in a way that directly reaches their audience. Since the influencer's audience considers him or her to be a trusted source, this type of marketing can be particularly effective. Brands can encourage UGC by inviting consumers to vote on particular styles or products. Brands can also encourage consumers to post photos or videos of particular products or ask consumers to share their feedback about products. Brands also encourage UGC and social commerce by creating communities or groups where people who enjoy certain brands can communicate with each other. This not only allows users to create UGC, but it also makes sales more likely since users will learn about new products in the groups.

The nature of UGC and the nature of two-way communication common on the Internet have also changed the messages that brands send to encourage social commerce. Brands have always shared stories about themselves, whether directly or through indirect messages. However, modern brands have begun to share even more explicit stories about themselves. These stories are meant to make brands seem more personal and create a connection between consumers and brands. Furthermore, brands are more likely to create articles, videos, or other informational content that will help consumers as well as sell products or improve brand visibility.

Social commerce and other technological advances have also encouraged the development of a number of small brands that now can reach wider audiences than ever before via social media. Companies such as Shopify and Etsy, which are platforms that allow smaller merchants to sell their products online, have increased small brands' ability to sell goods, and accept consumer payments. Many other e-commerce tools and companies—such as digital marketing companies that encourage consumers to share deals on social networks—have also played a role in expanding social commerce. Although many small start-ups are involved in social commerce, experts warn that not all of them will survive and the field will keep expanding and changing over time. Companies in digital marketing and related fields have to be flexible and inventive to succeed.

Another important element of social commerce is using tools that make sales easier and that encourage consumers to purchase goods and services on the spot. For example, brands can post advertisements on social networks that allow consumers to purchase directly from the ad, without having to visit an entirely different website to purchase the product. Cutting down on the number of steps involved in a purchase increases the likelihood that a sale will actually take place. Shoppable video, which is a video from which consumers can make purchases, is another important advancement in social commerce. Brands can also use messenger bots to remind customers about items they left in the shopping cart without completing a purchase. Brands are also able to tailor their campaigns for specific platforms and audiences. Instead of having one general media strategy, brands can use multiple strategies that they can target toward particular audiences on different platforms.

Experts predict that social commerce will only increase as people all over the world continue to rely on social media and e-commerce for shopping. The expansion of 5G and other technological enhancements will continue to propel social commerce even further. The fifth-generation mobile network, or 5G, is a global wireless standard that delivers extremely high data speeds, low latency (or delay), more network reliability, and increased availability. Since its inception, more users have had access to mobile technology for shopping via apps and social media. Furthermore, the increased speeds and lower latency have allowed brands to use tools such as shoppable video more often and to greater effect.

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