We Need To Be More Intuitive About Social Commerce

[Jobayer Hasan Rahi]

This week Elaine Moore at the Financial Times captured the current feeling of social media ennui brilliantly. Three years ago you couldn’t stop us from documenting our lives on apps such as Instagram. We were there, living our best lives, through our favorite filters, forever finding new opportunities to stoke up addictively gratifying levels of FOMO from our communities. We shared and consumed endless photos of holidays, beach days, yoga retreats, festivals, parties, weddings, relationships, dining experiences, coffee breaks — all those photogenic moments packaged into posts.

And then we stopped sharing. Former Gawker Editor-In-Chief, Max Read, spoke last year about how “unsettlingly boring” social was starting to become as lockdown “cut off our steady supply” of shareable moments. Rani Molla at Vox documented the feeling that in the wake of a pandemic sharing everyday posts about things like Peloton workouts was becoming incongruous with what was happening around the world.

The less content our friends posted, the more our feeds filled with ad placements, although even pre-pandemic those in the advertising industry were already seeing ad volumes rise as more and more advertisers came onto Facebook’s platform of apps. According to Ofcom, around this time consumers stopped spending so much time on apps such as Instagram too, with 18–24-year-olds in particular dropping their Instagram consumption by 15 minutes a day in 2020 compared with the previous year. By July 2020 the social listening tool, Brandwatch, reported a record number of monthly mentions of deleting social media.

Does Dialling Up Social Commerce Drive Consumers Away?

Perhaps the problem here is existential. If an app was designed to provide people with a platform for stoking and imbibing friendly FOMO, then a user experience and content supply that is purely driven by brand advertising is going to turn people off. It’s just not what users signed up for and it’s going to feel shoe-horned into the app.

But this creates a conflict of interest. Here’s an audience of people who are fatigued from being targeted by advertising at a moment when they were seeking a different kind of experience, alongside an industry of brands eager to reach those same consumers on their favorite apps, coupled with social networking platforms that need monetization models to survive.

The root cause of everyone’s woes is arguably the assumption that social commerce means pushing commerce into social-first platforms. Social commerce can mean different things, but at its best it means building ecommerce-first platforms that embed social interactions into their core.

The consumer who visits a social networking site to stoke or imbibe FOMO and instead sees a product ad is not at a highly-targeted moment in the customer journey: the consumer who visits an ecommerce site because they already have in mind the thought of buying something, however, is. The latter is ready to consider and purchase products and with the right experience might just convert into an engaged, loyal and repeat customer.

To understand the power of social commerce look for the intuitive moment when a consumer is actively asking to be targeted with relevant products. Social networks are primed to deliver these, not through advertising, but through an even more valuable kind of social content — organic word of mouth. Some [ur=https://www.nielsen.com/us/en/insights/article/2012/consumer-trust-in-online-social-and-mobile-advertising-grows/#:~:text=According%20to%20Nielsen's%20latest%20Global,an%20increase%20of%2018%20percentl]92% of people trust recommendations from friends and family[/url] over any type of advertising, and 74% of consumers identify word of mouth as a key influencer in their purchasing decisions.So rather than shoe-horning ecommerce into social networks that were never designed for that purpose, think of it as a way to source authentic word-of-mouth content and feed it into ecommerce at the prime moment in the customer journey.

Great examples of intuitive social commerce are Little Red Book (Xiaohongshu), where users can research, recommend and buy products, and Pinduodou, where consumers can make collective purchases and collaboratively negotiate the best prices. As of 2020 Little Red Book had 300 million registered users along with an 8% conversion rate, which compares with a 1.85% conversion rate on Instagram, while Pinduodou reported 643.4 million monthly active users in Q3 2020 (an increase of 806.2% over the past three years), along with a 75% increase in annual spend per buyer to $219.20 per year.

WOM’s partner app, YEAY, is another example of a social commerce-first platform designed purely for people looking to find or share inspiration about products to buy. Since its launch at the beginning of 2020, the YEAY app has had more than 200,000 downloads and more than 7,000,000 views of product recommendations, while the average North American user (the app’s largest market) has clicked on a product link from a recommendation 2.8 times, equating to a click-through rate of 4.22%, compared with 0.22% on Instagram and 1.11% on Facebook.

The Brand Takeaway

Social commerce only drives consumers away when it feels too contrived: it needs to feel natural and authentic and like it was meant to be there all along. Rather than looking purely to the biggest social networking apps as the obvious place to funnel ad spend into targeting consumers, take a closer look at the emerging ecommerce-first social platforms and you’ll start to uncover better conversion and click-through rates and more strategic opportunities to drive social sales.

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