By Ramy Assaf, co-founder and CEO of Zbooni
The term ‘social commerce’ was originally coined back in 2005 but it is in the last decade that it has become established in the retail industry. In the simplest sense, social commerce means using social media as a channel to sell directly to customers. However, it gets more granular depending on the circumstance, market and capability of the social platform itself.
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Social commerce allows companies to go exactly where their audience spends most of its time online. It started when larger brands simply placed ads on social media platforms such as Facebook, Instagram and Snapchat that redirected customers to their existing e-commerce sites. Meta made that experience shorter by allowing brands to ‘tag’ a product or multiple products in an image, which led to a checkout page. It then became native, allowing integrated checkout on the social platform itself without the need to leave the page.
Currently, YouTube is doubling down on its investment in the social selling market in 2023. It is a move designed to make up the shortfall of its dwindling ad revenues. Meanwhile, Amazon, which also saw a 2022 Q4 dip in profits, has teamed up with Snapchat in an attempt to capture the market and accelerate sales. Simply put, social commerce is a game changer and retailers that are not making the most of it will get left behind.
Unstoppable rise of social commerce in MENA
A recent global social commerce industry report states that the social commerce market is worth $2.9 trillion. MENA alone makes up approximately 5 to 7 per cent of this total figure. With our research, we assessed the potential scope of the market: up to 40 per cent of retail in the region can involve social and chat applications. This will take time as the industry is still nascent, but there is an ocean of opportunities for businesses looking to market and sell via social and messaging channels.
E-commerce is transitioning towards complementary social commerce. The days of simply putting a store online and waiting for the money to roll in are quickly disappearing as consumers demand more convenient, personalised experiences. Social commerce provides a highly effective way for online brands to capture the customer on the channels that they know and love. To put this into perspective, e-commerce websites generally convert around 3 per cent of shoppers into verifiable sales. However, when we spark up a conversation with a customer and build a genuine rapport via chat and social apps, it results in a sale more than 80 per cent of the time.
Providing enhanced social experience to capture sales
During 2023, we will see a rise in consumers who want to try on shoes, makeup, sunglasses and more through social media apps that have augmented reality (AR). It is a great way to offer even the most remote customers a try-before-you-buy experience. Similarly, live-stream viewing parties will grow in popularity as brands tap into the relevancy and reach of social media influencers.
Creation of bespoke collections for individual customers
Retailers can use the power of commerce applications to curate and share bespoke collections with potential customers instantly. Marketing campaigns can be tailored to select groups and individuals based on their shopping history and preferences. This eliminates the broad-brush method of marketing, lasers in on specific demographics and retains repeat customers for longer.
Capturing the power of human conversation
The most important trend for 2023 is how messaging platforms such as WhatsApp can be used to drive more sales in a frictionless way. Chatbots have become an integral part of the e-commerce landscape as they can quickly answer questions or direct customers to the right places through pre-programmed responses. As a society, we have become more aware of when we are talking to an automated service; they are a turn-off. This alone can lead to a completed sale or an abandoned cart. Retailers must become more sophisticated with how they adopt social commerce. Connected commerce or ‘c-commerce’ is the answer. This incorporates all aspects of social commerce through genuine conversation and delivery of a concierge-like experience for customers.
Talking to a customer – human-to-human – allows for a white-glove approach that builds trust and converts sales. Retailers with existing online or physical stores as well as start-up brands selling directly via social and messaging channels can benefit from c-commerce tools to create personalisation and empower closer relationships that turn conversations into converted sales.