Social commerce has become a strategic imperative for brands seeking to expand revenue and capture new audiences as competition for next-gen consumers grows at a staggering rate across the retail and direct-to-consumer markets.
This is according to a study commissioned by customer experience platform Emplifi, which uncovered insights from more than 220 global enterprise ecommerce leaders on social commerce strategies, early trials, and planned areas of investment.
The ‘Cashing In on Social Commerce’’ Forrester Opportunity Snapshot study highlights the challenges experienced by early adopters in the social commerce spaces who aim to fast-track revenue expansion efforts and improve overall customer care via social channels.
Social commerce, which encourages the discovery and purchase of products via social media channels, is expected to grow at a 31.4% compound annual growth rate (CAGR) between 2020 and 2027, the global social commerce market is estimated to grow to $604.5 billion by 2027, according to Research and Markets.
According to the study findings, fewer than 30% of social commerce leaders are prioritising customer engagement, failing to cultivate and nurture customer relationships throughout the social purchase journey, and putting their long-term social commerce growth at risk. This data point underscores how, even as brands are beginning to prioritise social commerce and experience immediate returns, many still have a long way to go in terms of successfully managing the full social purchase journey. Without proper attention to CX, ecommerce leaders risk falling behind in an overly competitive market.
Mark Zablan, CEO of Emplifi, said: “Consumer demand has forced businesses to pivot online, and we have seen a significant uptick in the number of B2C businesses embracing social commerce.
“We believe the study confirms much of our internal findings: B2C brands are racing to embrace social media as the means to conduct business from discovery to engagement, and now to shopping, service, and customer care. Social commerce is the new conduit to great CX.”
More than 80% of the social commerce leaders surveyed confirmed they are investing in two or more social shops, with more than a third currently using four or more social shop platforms. Not only are social commerce leaders adopting social shops at a swift pace, 86% of the survey participants expect — or have already achieved — a return on their social commerce investment within a one-year time period.
Zablan said: “Social commerce leaders are seeing major gains but are also becoming increasingly aware of the need to bridge the gap between building brand presence among a growing audience, and then convert that audience into loyal, engaged long term customers.
“The most effective, and efficient, way to do this, and accelerate social commerce efforts, is to utilise best-in-class CX tools with integrated social capabilities. By sharpening their toolset, especially when it comes to customer care and holistic social commerce reporting, brands will get the competitive edge they need in this rapidly growing social commerce market.”
Among the study’s key findings:
– B2C goals and strategies not optimally aligned: While goals are documented and understood, the report shows only 26% of teams are aligned on how to reach next-generation consumers across social shops.
– Conversational AI basic capabilities are well adopted: Bot technology that provides basic communication and engagement is heavily used by the brands surveyed, but eight out of ten survey respondents report they are looking to invest further in more sophisticated conversational AI capabilities in order to conduct advanced transactions using virtual bots.
– Livestream video shopping shifting beyond early stages: Of the brands surveyed, 70% plan to invest in personalised and group/friend video shopping capabilities, as well as one-to-many influencer events over video.
– Scaling up customer care and service is critical to social commerce and CX. While the report highlights revenue as the ultimate outcome, over 40% of responses indicate that customer care, service and assistance are critical for social commerce and improve overall CX.
– While an astounding 50% of the brands surveyed for the report have realised measurable revenue gains or expect incremental cross-channel revenue, the data shows the most successful social commerce efforts go beyond the immediate purchase to focus on the full customer experience.
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