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What Is Social Commerce And Why Does It Matter?

As technological trends change and innovation takes place on the web, the way businesses market and sell their products and services changes as well.

While by now most of us have heard of e-commerce—a term that refers to transactions that take place on the internet—what is social commerce?

And, more importantly, why should anyone care about social commerce?

Social commerce is similar to e-commerce in that it describes the buying and selling of products and services on the internet. However, social commerce is more narrowly defined as the process of selling products and services on social media platforms.

Major social media platforms have massive user bases and many of them draw millions of visitors every day. By engaging in social commerce, you can capitalize on the popularity of social media platforms and get your brand in front of a global audience.

Through social commerce, social media users can discover your business, browse your offerings, and make purchases—all on a social media platform.

If you don’t already have a social commerce strategy in place or you want to enhance your existing strategy, this article is for you. Social commerce can be a lucrative opportunity that allows you to grow your audience and make more sales.

Read on to learn more about what social commerce is, why social commerce is important, and social commerce best practices to follow.

Social commerce definition

Social commerce refers to the practice of marketing and selling products and services directly through social media platforms. In this sense, social commerce falls under the umbrella of e-commerce. A social commerce strategy leads to online transactions, specifically through social media platforms.

In a 2021 survey, 53% of respondents reported that they shopped on social media at least once per week.

While there are many platforms out there that may be able to support social commerce, this practice primarily takes place on a few top social commerce platforms. At the current moment, the largest social commerce platforms include:

  • Facebook
  • Instagram
  • TikTok
  • Pinterest

All of the platforms listed above have built-in social commerce features that makes it easier for brands to advertise on social media and make sales within the app.

By leveraging the native social commerce features of these apps and setting up an online store in each respective app, you can reach millions—or even billions—of social media users and allow them to make purchases on the app of their choice.

What is the difference between social commerce and e-commerce?

While e-commerce and social commerce are certainly related, there is a distinct difference between the two.

Whereas e-commerce describes the buying and selling of goods and services online, social commerce specifically refers to transactions that take place on online social media platforms.

Essentially, e-commerce can take place on a company website, an online store, or even on a business’ app. Social commerce, on the other hand, only takes place on networking or social media platforms.

Why is social commerce important for businesses?

Designing and implementing a social commerce strategy enables your business to tap into a large audience and creates selling opportunities that can have a major impact on your bottom line.

The importance of social commerce: Create convenient shopping experience, Expand your audience, Collect data Boost sales, Create a community

Approximately 4.48 billion people around the world currently use some form of social media. Thus, social commerce presents a tremendous opportunity for brands that are looking to reach new audiences and generate more sales. Below, we go into more detail about some of the key benefits of creating online shopping experiences through social commerce.

Easy shopping experience for your customers

Online shopping is a convenient way to research products, make purchases, and get them delivered directly to your door.

Social commerce makes online shopping even easier by allowing users to quickly make purchases within a social media platform. By implementing a social commerce strategy for your business, you can optimize the user experience and satisfy both existing and potential customers.

Expanding your target audience

One of the most important benefits of social commerce is the opportunity it provides to expand your target audience.

By building a presence on a social media platform and utilizing a social commerce strategy, you can reach social media users around the world. Reaching more online shoppers allows you to grow your client base and build relationships with customers.

Data collection

Many of the top social media that support social commerce provide sellers with valuable data and insights. You can use this data to segment your audience and target the shoppers who are most likely to be interested in your products and services. You can even take matters into your own hands and create surveys and polls to collect customer feedback and respond accordingly.

Financial opportunity

There’s a lot of money to be made through social commerce. We’ve already mentioned that social media channels have massive amounts of active users, which in and of itself creates a significant financial opportunity. But also consider the fact that $80 billion worth of goods and services are projected to be purchased through social media channels by 2025.

The social commerce market continues to grow as businesses continue to capitalize on the popularity of social media. By implementing a social commerce strategy for your business, you can get a piece of the revenue being generated by social commerce and remain competitive in today’s market.

Creating a community within your customers

Social media platforms exist so that people from around the world can connect online. By engaging in social commerce, you can make online shopping a much more social experience.

Increasing the social aspects of shopping and providing users with interactive features can make shopping more fun and help build a community around your brand. For example, users can share your content on social media, tag their friends in comments on your posts, and message you directly to obtain more information about your products and services.

Social commerce best practices

Now that you know what social commerce is and how it can benefit your business, you may be interested in how to use it.

In order to design and execute an effective social commerce strategy that resonates with potential customers, you must keep a few things in mind.

Social commerce best practices: Choose the right platform, Engage your audience, Use a chatbot, Be creative

Below are social commerce best practices to follow as you begin to engage in social media marketing and sell your products and services online.

Choose the right platform for your business

Every social platform is different and some may be more accommodating to your business than others. For instance, Facebook is a social media platform where text posts tend to be very popular, whereas Instagram is a more visual social platform dominated by images and videos.

Each social media channel offers different social commerce tools and capabilities as well. Facebook, in particular, offers a range of social commerce features.

Using Facebook, you can create a business account and set up a Facebook shop, which can act as your brand’s online storefront. In your Facebook shop, users can browse your offerings and make a purchase without leaving the platform.

The bottom line is that you should choose a social commerce platform that aligns with your business goals. Review the social commerce features that each platform has to offer and take a look at the type of audience that each platform attracts. Pinpoint the platforms used by your target audience and create social commerce campaigns on those channels.

Engage your audience

Social commerce can make your customers feel closer to your brand and this, in turn, can help you better engage with customers.

Social media platforms give users the opportunity to like your content, comment on your posts, and even interact with your brand directly. You can engage with customers in comment sections and customers can send you a direct message if they have a question. This type of engagement can help you win customer loyalty and expand your online presence.

Use a chatbot

Chatbots can be a very valuable tool, especially if you consistently deal with a lot of customer inquiries.

One of the best parts about chatbots is that they can respond to customers immediately and potentially provide quick solutions. You can design a chatbot to answer basic customer questions and even perform certain actions, such as retrieving specific order details and processing those orders.

Keep in mind that, in most cases, a chatbot shouldn’t be your only customer service option. You should still have customer service specialists on staff that can help customers resolve more complex problems.

However, chatbots can potentially save your customer service team a lot of time by sorting out basic issues and engaging with customer inquiries.

Be creative

Creativity is key to any successful social commerce strategy.

Being creative in your social media marketing tactics and digital merchandising allows your business to create great online shopping experiences for your customers. Don’t be afraid to dig into the full range of social commerce features that many of the major social platforms offer, including emerging or experimental features.

Use Mailchimp to build your social commerce strategy

With a social commerce strategy in place, you can optimize the customer journey on social media. Leveraging social commerce platforms enables your business to use data to market to a targeted audience and make sales directly on social media. In doing so, you can expand your audience and more closely engage with customers.

Mailchimp is here to help support your social commerce goals. With Mailchimp’s all-in-one marketing platform, you can create everything from targeted social media ads to specialized landing pages. Try Mailchimp today to see how it can help you build stronger relationships with your audience.

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