Reading an article today got me thinking again about social commerce. I have touched on it a couple of times in Gartner research notes, most recently one that shows a surprising amount of in-store activity linked to social media ( Become More Social to Increase Physical Store Sales ). This research highlighted 3 key findings.
1) The impact of Facebook on physical store transactions is unexpectedly high. Fifty five percent of consumers had visited a retailers Facebook page, 88% of the consumers surveyed had “liked” a retailer’s Facebook page, and 34% of those who visited reported that they made a purchase as a result of something they saw on the page. But most interestingly 63% of the purchases that consumers made as a result of a retailer’s Facebook postings were transacted in a physical store.
2) Consumers overwhelmingly view the retailer’s social media activity as a way to obtain deals or special offers. Our research shows that 71% of consumers visited a retailer s Facebook page for coupons or special offers, rather than to participate in “social” activities.
3) The large majority of consumers want to keep their Facebook activities private from retailers. Over 80% of consumers of all ages remain skeptical about allowing retailers to access social network information. While several Tier 1 retailers encourage using Facebook to log on to their e-commerce websites, only 20% of consumers surveyed indicated they had used social sign-in.
The type of retailer they reported shopping with because of a social posting varied also, but just a few rose to the top. For North America, Walmart, Best Buy and Old Navy ranked highest among multichannel retailers reported as the place where consumers completed their purchase. In Western Europe, H&M, Drogerie Markt (DM), Fnac and Tesco topped the list. Both geographies reported Amazon at 7%.
When we investigated why consumers were hesitant to open Facebook to retailers their answers were consistent across age demographics.
Gartner 2014
To make it simple, consumers only want to hear from socially from a retailer on their terms. They don’t want to be your friends or share special moments with you. All they want right now is to know what kind of deals you are offering. So I asked myself candidly if social commerce is a non-starter. My answer is no, but Facebook and Twitter are not going to be the drivers. I maintain that shopping is after all a social behavior. We know that there is a significant movement toward texting and snap chatting and tumbling and vining as social connectivity. This occurs while people are together in the same room, or in the same store. Gartner research has reported for some years that accessing a social network is one of the most common activities performed on a smart phone while in a physical store.
Shopping in the digital age will be forever changed. Yes I believe that a social shopping retailer will emerge. Yes I said retailer. This is an inevitable step in the evolutionary process. Retailers are basically a collector/curator/aggregator of products that creates a certain image or lifestyle. They rely on complex supply chains to deliver goods in mass to various locations, and marketing organizations to drive consumers to stores, or ecommerce channels, craving the merchandise they have to offer. In the digital age anyone with a basic understanding of technology can gather virtual assortments based on customer’s perceived tastes. Marketing messages can become free as consumers post images of products in use.
It may be that an ecommerce retailer will get there first, or a large multichannel competitor. Perhaps a specialty retailer like Sephora, that just launched a proprietary social network, but my bet is on some presently-14-year-old girl with a smart phone.