How social commerce can serve as an important marketing tool for brands
Brands need to be more proactive in tapping into the potential of S-commerce, a next generation trend that will reshape the future of commerce.
In the west, social media platforms like Facebook and Instagram are used for, well, social interactions while e-tail platforms are used for shopping. It’s still a different mental-mode where one has to switch from social to commerce. In the east, however, the convergence is more evident where the same app, like WeChat for instance, is used for social interaction and for shopping. Commerce and social are intertwined and this is where S-commerce or social commerce is taking roots.
With a population of over 1.2 billion people, India is one of the most varied markets in the world. Given the strong retail and consumer outlook, the country is expected to witness redefining trends in the consumer markets which will shape the future of retail and consumer industry. Consumer experience will be the key focus area for brands and technology will facilitate the enhancement of experience throughout their shopping journey.
S-commerce is a next generation trend that will reshape the future of commerce. Globally, sales worth $50 billion was generated using social networks in 2017. Today, young consumers to the tune of 52% especially in the range of 25 to 35 indulge more in posting ratings and reviews of their purchases. Similarly, in India, social media platforms and online product/ service reviews form an important part of millennials’ shopping journey as it influences their purchase decisions. 28% millennials purchase products due to social media recommendations and 63% millennials stay updated on brands through social media. Such is the advent of S-commerce that the term ‘influencer marketing’ increased by over 300% on Google searches in 2018. Almost 65% of marketers are planning to increase their budgets for influencer marketing.
There are nearly 200 million active social media users in India currently, and the number is expected to grow to around 370 million by 2022. Categories such as fashion, consumer healthcare, baby products, food and beverage industry, financial services, beauty, personal care and women care are gaining prominence on social networking sites.
Millennials are spending nearly 17 hours online every week – with the major activities being social networking, streaming music and videos and omni-channel shopping. With such a significant engagement, social networking sites have become a medium for instant gratification.
Major play areas for brands to tap S-commerce potential
Over half of the total consumer demand on social media platforms comprises of cosmetics and beauty products. The segment is followed by food, beverages and grocery, which is the second most-sought-after category. Further, India emerged at the top in terms of leveraging social networking platforms for the sale of goods and services. Brands need to gear their marketing strategy to seek out new consumers, and companies will need to keep up with their consumers’ lives in a non-intrusive way and provide customized offerings. Brands will need to provide an experience rather than just the product.
Companies would need to study consumers’ shopping patterns and online behavior while leveraging advanced data and predictive analytics. These insights could be used for providing the customized and immersive experiences for consumers throughout the shopping journey.
Brands need to be proactive in tapping into the potential of S-commerce in its initial stages and capitalize the insights so obtained in catering to the changing tastes of the younger consumer. Marketing for S-Commerce will add an important aspect to the marketing plan of brands and would be geared towards ascertaining the reasons behind the customers’ choices and preferences. It would also become an important tool for brands and companies to gauge the impact for their customized product solutions by tracking the online response to their campaigns and at the same time use this channel to address consumer feedback and grievances.
(The author is managing director and chief executive officer at Spencer's Retail. Views expressed are personal.)