RED PAPER

THE RISE OF SOCIAL COMMERCE – BUCKLE UP AND ADD TO CART

WHAT IS SOCIAL COMMERCE?

Social Commerce is a subset of e-commerce and more broadly retail. It’s the evolution and maturation of social media meeting shopping. Essentially allowing a transactional relationship to take place between customers and sellers, enabled by social media.

EMBRACING A NEW REALITY: 

The breakthrough of Social Commerce is logical but also society driven. What’s happening today isn’t just circumstantial, COVID-19 heralds an inevitable and palpable shift in consumer behaviour that will change the face of both traditional and online retail. Although it’s too early to be definitive, studies have predicted that in the UK, for example, 40% of all physical retail may move online following the pandemic: that’s a 20% increase. In gravely affected countries such as Italy, 35% of the population have reduced their reliance on conventional retail and OOH consumption.

This boost of online presence unlocks an opportunity for Social Commerce to break through, faster than initially thought. But it also exposes challenges; Social networks will need to gear up R&D while the biggest change needs to come from advertisers. From large corporations to SMB’s, all businesses face the pressure of rethinking strategies in order to fit into this post-pandemic retail landscape.

PLANNING CONSIDERATIONS

So how can you succeed and fit in that new retail landscape? Social Commerce is a ‘hybrid animal’, definitely not suited for rigid structures. This means your organisation needs to be flexible and responsive to consumer trends before implementing it. We believe this new way of retail must be thought and developed around five key dimensions

HARMONIZE BRAND BUILDING & PERFORMANCE 

Don’t operate in marketing silos but instead construct synergy between Social Commerce and brand building tactics, each enhancing the other. This will help you to leverage the correlation between short and long-term effectiveness and create relevance for the consumer. Brands with a stronger salience and online presence see a higher response rate from their activation channels. 

CREATE AN OMNI-CHANNEL STRATEGY 

We’re in an era where consumers no longer care where they purchase. Today, the path from discovery to purchase traverses across several channels. This is why brands design ecosystems that connect both online and offline, as well as utilise partnerships and craft consistent omni-channel distribution mechanisms.

DESIGN IMMERSIVE & SEAMLESS EXPERIENCES

As content is still king, we believe that immersive experiences such as AR have the ability to stimulate click-through-rates, purchases and reduce dropping off. While a seamless and short conversion path (i.e. simplifying and reducing steps) is proven to be an efficient catalyst as well. 

DATA & ANALYTICS FOR A PERSONALISED JOURNEY 

It’s essential for brands to understand that Social Commerce efforts should always address the target personally, but not too intrusively. Advanced understanding of what tickles the audience’s senses and tailoring of the content based on those insights will help reduce media waste and guarantee a pinpointed message delivery.

DEPLOY THE POWER OF INFLUENCE 

Nowadays advertisers line up their influencers as content creators and curators in order to maintain authenticity and credibility. But more and more influential people contribute to the decision process and even spark the last click. This is why social platforms are increasingly integrating influencer shopping features and check-out possibilities. 

EXECUTION & GROWTH

Success in Social Commerce isn’t just about adhering to strategy, it also relies on good media execution. To drive business impact, Social Commerce planning needs high quality execution that seamlessly drives growth and incremental conversions instead of just focusing on cost-efficiency.

A FUNNEL LEADING TO ECOM 

The key principle of this customer-centric approach is re-engagement. The audience is continuously filtered from stage to stage based on social engagements. For instance, only people who engaged with the Awareness content will be targeted with Consideration content and eventually Sales assets.

TESTING 

An essential tactic. For our Social Commerce projects, we are able to run more than 50 different A/B tests over the course of a year. Relevant testing parameters: formats, targeting clusters, platforms, placements and call-to-actions, to name a few. 

DEFINING & REFINING THE AUDIENCE

When crafting a tailor-made Social Commerce driven strategy, interest, demographic and behaviour-based targeting are key building blocks. You will need to find the ideal balance between broad and niche targeting. Additionally, your defined audience is the seed for a more refined segmentation (e.g. previous engagers, lookalikes based on similarities)  

DEPLOYING AUCTION BEST PRACTICES 

A reliable Social Commerce strategy can only succeed by building further on what’s working. For instance, longer term campaigns increase the chances of underperformance. A higher frequency is recommended as your ideal user needs to be reached several times. Because you’ll reach the user multiple times variation in creative assets is a must. And most importantly: lean on the algorithm and dynamic optimisation features that the social network offers. 

THINKING BEYOND ROAS 

When you prioritize Social Commerce in your overall strategy you should measure efficiency by looking beyond return on ad spend (ROAS). From a transactional point of view, we believe marketing efforts should be aimed at driving growth. Therefore, the KPIs should be adapted to measure incremental growth, which isn’t possible by focusing on ROAS.

WHAT’S ALREADY HERE / NEXT?

The quality of experience design can either help a brand to get ahead of the curve or send it to the back of the queue behind its competitors. From our point of view, success in Social Commerce is built by combining functionality, an excellent user experience with creativity and playfulness. Across the social landscape there are interesting cases of how the platforms are enabling fluid and seamless transactions. 

FACEBOOK PAY

Facebook is introducing Pay, which will provide people with a convenient, secure and consistent payment experience across its cluster of apps: Facebook, Messenger, Instagram and WhatsApp. 

INSTAGRAM CHECKOUT

Instagram geared up in the commerce race by offering its users a 2-step purchase option without leaving the app. The Checkout feature is still in beta and made available for influencers in selected markets. In addition to that, Instagram also aims to bridge the gap between online and offline by offering QR codes that lead directly to Checkout.

TIKTOK IN-APP BUYS

TikTok is also jumping on the bandwagon of Social Commerce and has introduced a way for brands to monetise on the platform. Users can now purchase items that are marked with a sponsored hashtag. 

WHATSAPP CATALOGS 

Small-sized businesses can showcase and share their goods, so users can browse and discover items they would like to buy. Currently this solution is only available in large-scale markets. 

ASIAN SUPER APPS

Social Commerce has already proven its potential in certain key markets. With Asia gradually becoming the barometer for the global consumer’s pulse, it is safe to say that the design of fully integrated super apps such as WeChat will inspire the rest of the world. These apps have the characteristics of an operating system and allow users to combine entertainment, social networking and commerce in a single space. 

TO CONCLUDE 

Social Commerce has become the new impulse aisle and, some would say, the new shopping mall. Still, the biggest – and most urgent – constraint for Social Commerce’s breakthrough is untangling the level of fragmentation in retail marketing.

A lot of businesses – small or large – already have an omni-channel set-up available. Still, it remains siloed and not integration-first. This requires extra staff and increases costs. These efforts could and should be re-allocated to experience. Both existing consumers and prospects won’t settle for less than a seamless experience when purchasing products and services, preferably in a single session without many detours. 

This is why we believe Social Commerce can fill this space to meet time-sensitive consumer demands and tackle these fragmentation challenges. The margin for platform innovation and perfection is big, the momentum even bigger.

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Dimitri Cologne (Paid Social Director)
Mathieu Gillain (Global Head of Media)

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