Currently, companies generate approximately $5 billion in web sales via social sites and mobile applications. And according to Moontoast in a report titled, The Social Commerce Opportunity, this number will explode to $30 billion by 2015. Gartner predicts that 50% of web sales will occur via a company’s social presence or mobile applications. See graphic below:
Should you be taking advantage of social commerce or is it a waste of time?
Though this decision will depend on a number of factors like the demographics of your audience and the nature of your products, generally speaking, online retailers can see a boost in sales by taking a look at what social commerce has to offer.
Here are some of the advantages to implementing a social commerce strategy:
Repetition builds trust – The more people see offers or posts from your company, the more they will come to trust your brand.
Easy sale – As an ecommerce retailer, you know that the fewer steps in your checkout process, the better chance of a conversion. By offering a store experience on your Facebook page, your customer can stay on the site while shopping which will increase impulse purchases.
User interaction – With Facebook, it’s easy to offer deals, coupons, special contests and other incentives to your Facebook fans.
Social Sharing – Word of mouth sharing is what Facebook is all about. By incorporating your store on Facebook you can take advantage of social sharing to enhance product awareness and conversions. Basically, you are imitating a normal shopping mall experience for your users by allowing them to share their experiences with friends. Shoppers, when using your ecommerce application, can choose to share their social profile data and friends lists. Customers can recommend products, gift ideas based on friend’s birthdays or share coupons all within the same interface.
Though social commerce seems like an ideal strategy for online retailers, it shouldn’t constitute your store’s main strategy. Here’s why:
Usability testing has become so sophisticated that webmasters can track a visitor’s every move with precision. Analytics data displays how your visitors arrived on your site and which marketing programs are most efficient for driving sales.
With social commerce, these statistics are non-existent. While Facebook Insights does provide data on user interaction and engagement, it does not offer details on user activity as it relates to behavior and sales conversions.
Also, you cannot optimize your Facebook social commerce platform for the search engines similar to how you would for a website. Facebook storefronts use iFrames and Flash, which are often disregarded by the search engines.
You will need to decide whether social commerce makes sense for your store. According to David Fisch, Director of Business Development at Facebook, “the storefronts are really only one piece, and really a pretty small piece, of the burgeoning area of social commerce. Our interest isn’t in getting people to create tabs where people can shop but allowing consumers to shop wherever they are and helping them discover products through their friends.”
Social commerce may not be sophisticated enough to become a sole marketing strategy, but it is definitely robust enough to complement an already thriving sales strategy.
What are your opinions on social commerce?