Social Commerce & Shopify
It’s tough times out there, and every merchant is looking to keep their revenue streams in a place that means their business can survive any economic unpredictability. The amount of time spent on strategy, marketing theory, and knowing where to put resources can be overwhelming. Do you focus on driving conversion, or ﬁnd better ways of looking at retention? Keeping up with ever-shifting trends means that unless you’re on the pulse of each consumer’s interests then you could be in the dark and spend time on a strategy that was doomed from the start.
Recently, Shopify has kept moving forward with innovation to ensure that all channels of revenue are dynamic and keeping on top of current market trends. This has led to the release of “Collabs”, capitalising on the increasing importance of Social Commerce. Where this may be a relative term to some merchants, it’s important to understand how this overlaps with areas like UGC, personalisation, and conversion opportunities, as well as understanding your demographics. For example, Shoppable Video Reviews have proven a 3-5x higher conversion rate than written testimonials, which has also increased session time and ultimately, revenue.
So what do we mean when we say Social Commerce? In a nutshell, it’s the utilisation of social media to drive conversion in a more concentrated way. No matter what the vertical, every merchant has a form of social presence, whether it’s an Instagram Account, Facebook Page, or on TikTok. Whereas it may be true that certain demographics don’t account for all social media platforms, it’s undeniable that all businesses have a social presence and underutilisation of it could be a huge missed opportunity .
This concentrated effort has come with changes within marketing strategies after understanding post-pandemic e-commerce habits. For example, for merchants who never used a TikTok pixel pre-2019, data showed a 66% increase in revenue for those that did. And the time to capitalise on this has not passed, as the landscape is only getting more social. Shopify partnered with TikTok in 2021 to integrate the app into the platform to position live sales. YouTube has also just announced a partnership to be able to buy in-stream, connecting the sales directly to your dashboard API.
What Are The Important Things to Know?
The Data: The data is fairly new, but it trends towards an uptick which is worth knowing when forecasting your upcoming marketing strategies. The main, and maybe obvious thing to know is that social media usage has increased by around 16% year on year, which is the reason apps like Instagram now have dedicated shopping channels. It’s now antiquated to think that Instagram is just for sharing pictures, and Youtube is just for watching videos, these are platforms within themselves that open up potential revenue streams like never seen before. The innovation is now in a place where simply sharing a post is the bare minimum and could be discarded as quickly as it takes to view it.
The Demographic: At the heart of all business, knowing your audience is key. If your vertical caters more toward a 40+ age demographic, social commerce may not be your priority as the surge in conversion lay within Millennial and Gen Z purchases, with the more technologically savvy merchants either already having an e-commerce store or quickly moving to one during the Pandemic. Spending habits have radically changed, and consumers are now making purchasing decisions based on new key identiﬁers; including geography, company values, and sustainability. Figuring out how these fold into your model is vital when collecting your data and ﬁguring out how and with who to move forward.
According to a commissioned study conducted by Forrester Consulting on behalf of Shopify, 47% of the consumers said having a local presence was a signiﬁcant factor for which brands they shop from. Consumers are 4x more likely to purchase from a company with strong brand values. And a whopping 77% are concerned about the environmental impact of the products they buy. They’re willing to spend more money and accept slower shipping times—for the right brand. They’re also returning to
in-person shopping, and shopping in new ways: social commerce sales are set to nearly triple by 2025,4 and 40% of consumers say they plan to pay with cryptocurrency in the next year.
What is Social Proof?
As behaviours shift, ﬁguring out where they originate is as important as knowing where they’ll go. Considering 88% of mobile usage is spent on a social media app compared to a browser, the rise of “the inﬂuencer” is nothing to roll your eyes at. Teenagers and Gen Z who now make up a large percentage of the e-commerce market, tend to rely on the opinion of others in making a purchasing decision. Product reviews, testimonials, case studies, or even public praise factor into the decision-making process. As of 2022, it’s predicted that an average person may spend 100 minutes of their day watching online videos, which is where shoppable videos open a new opportunity for revenue. In fact, TikTok Business stated that the “unstoppable power of #TikTokMadeMeBuyIt” inspired 67% of users surveyed to “shop even when they weren’t looking to do so”.
How does this look in real life?
To help merchants capitalise on this, Shopify released “Collabs” an app to help link up with collaborators and incentivise the customers with unique promotions and interaction.
If you consider that TikTok has around nearly 800 million users worldwide and is largely geared toward a younger audience, not understanding the impact of marketing through this channel could be an untapped resource for new revenue streams. 62% of TikTok’s demographic falls into the 13-29 year old age category, and as a generation are more likely to buy based on videos and social proof. TikTok, like Instagram, have Shopping tabs directly in their proﬁles - but now you’re able to buy straight from the video, reducing the traditional friction to checkout so you’re primed to buy rather than be directed to the store or collection page.
How to Utilise Social Commerce on Shopify
Apps like Okendo or VideoWise have found a way to include videos on site without reducing site speed, using dynamic ways to have video testimonials, familiar user-generated content (UCG) and post-purchase Email campaigns that encourage users to share pictures or videos that will engage with audiences. Understanding that the transaction can continue post-purchase is key for repeat revenue, and these apps now simplify the process. So if you’re not utilising social commerce, maybe now is the time to change your strategy and see how to make it work for you.