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Is Social Media the Future of Digital Commerce?

By Nicole Lim / April 14, 2020

Is Social Media the Future of Digital Commerce

Although the shine is starting to wear off social media platforms, social media marketing can still be a powerful tool for brands. In 2019, social media use among the American public rose to 72%, with YouTube and Facebook being the most popular platforms. Additionally, the same research shows that social media is a part of a routine, with 74% of users checking Facebook and 63% checking Instagram every day. Brands have noticed the reach of social media and are using it to target a wider audience. Other benefits to social media marketing include:

  • Allowing customers to discover brands through social content;
  • Helping customers find products they wouldn’t normally search for;
  • Creating a unique shopping experience;
  • Developing customer loyalty;
  • Sharing campaigns and generating conversations;
  • Learning what your customers want;
  • Providing better customer service;
  • Directing more traffic to your site through links.

Many businesses have seen a rise in online shopping and have turned to e-commerce and online marketplaces to accommodate the new way their shoppers buy products. Additionally, the breadth and popularity of social media make social media marketing a natural segue for online shops and marketplaces.

The Past and Current Impact of Social Media on Online Marketplaces

During the early years of the internet, many brands embraced the competitive advantage the web offered. Search engine optimization (SEO) was, and still is, a major focus to direct more traffic to websites as social media did not exist until the late 1990s. By the mid-2000s, YouTube, Facebook, and Twitter became available to users and changed how people interacted with each other and brands. LinkedIn became a ubiquitous platform for executives, thought leaders, and an important networking tool in the B2B space. Across platforms, customers could search for products and services from the comfort of their home and brands could instantly interact with their audience, answering any questions or concerns while developing customer loyalty.

Currently, customers are using social media more than ever to discover brands, products, and services; 79% of Instagram users have discovered new products through the platform. Many social media platforms have integrated shopping features, including:

These integrations are created on the heels of customer demand. Customers want a seamless shopping experience, which means less page navigation and more buying options. Before the integration, digital commerce sites relied on the reach of their posts and referrals from ads or affiliate networks. Now, these online marketplaces can influence transactions through social media with these shopping integrations, inherently guiding customers through a relatively painless buyer’s journey. For organizations that sell digital services, social media is an effective way to contextualize their service for the customer.

In the State of Social research study, 58% of brands stated that social media is an important part of their marketing strategy. Additionally, 43% of businesses stated that social media marketing was effective for them. These statistics show that social media helps drive sales if it is used correctly.

The Future Impact of Social Media on Digital Commerce

With the integration of digital marketplaces and social media, social shopping, also called social commerce, is gaining in popularity. Customers can now click on a Facebook, Instagram, or Pinterest post and instantly see how much the product or service costs, and can additionally make transactions without ever leaving the site. More and more brands are continuing to optimize their social media experiences to help expedite the buyer’s journey.

Modern consumers crave brand authenticity and use social media to read real customer reviews on products — around 70%, to be accurate. Besides reviews, social media is holding brands more accountable for influencer marketing. 54% of consumers believe influencer marketing misrepresents real life, leaving brands to look for more authentic marketing solutions. Instead, digital commerce brands have turned to user-generated content (UGC), which helps create a more engaging and realistic shopping experience. With these statistics in mind, it’s predicted that online brands will rely more on UGC to feature products, services, and content that resonates with their customers.

Additionally, with more social platforms created, there are more opportunities for digital commerce brands to market to a new audience and take advantage of the platform’s capabilities.

How Digital Commerce Businesses Can Make the Most of Social Media

Some brands may find social media intimidating. They often don’t know which platform to start on and are intimidated by the amount of time social media profiles demand. However, employing an effective go-to-market strategy can help brands stay focused on their goals and increase their brand awareness.

Post Regularly

Creating a community on social media takes time, energy, and, most importantly, consistency. Brands must find a balance between keeping their customers updated on new services and products and flooding them with too much information. One way to ensure you are staying at the forefront of your customer’s minds is to keep a posting schedule. To create a posting schedule, you will first want to analyze when your customers are online. You can obtain this information from any social media platform analytics. Once you know this data, you can start to piece together optimal times to post your content.

How often you post on social media will depend on your resources and how much time you have dedicated to your social media presence. Some brands find that posting on Twitter multiple times a day helps engage their customers, while they only post once on LinkedIn. Finding the right posting schedule can be trial and error, however, experts agree that posting more frequently on chronological-based platforms will get you more visibility.

Find a Good Marketplace Platform

If your online business is a marketplace, it’s a good idea to invest in a marketplace platform that allows for integrations. To be sure you’re choosing the right marketplace platform, be sure to consider the following:

  • The ability to integrate with existing systems;
  • Billing built for digital marketplaces;
  • A catalog inventory;
  • Clear product roadmaps;
  • Easy onboarding;
  • Accessible admin tools.

Investing in marketplace software can help online businesses make the most out of leads brought in through social media by customizing branding and creating functional billing.

Open Channels of Communication

It is important to keep open lines of communication with your audience in case they need to contact you. Direct messaging over social media can help brands seem more trustworthy. In a recent survey, 70% of customers said they feel more confident about brands that they can message. Additionally, direct messaging can help facilitate an instant connection with your brand. You can also use messaging to send promotions, coupons, and updates on products and services, which can help personalize the shopping experience for many consumers. This can also be a powerful way to support retention, by offering additional, flexible options for clients to engage directly to troubleshoot, ask questions, or provide feedback.

Track Audience Analytics

Many social media platforms have built-in analytics for business accounts. These analytics can tell you:

  • The reach of your posts;
  • Your post’s engagement;
  • The different regions your audience is in;
  • The times your audience is online;
  • How your competitors are performing;
  • Follower growth;
  • How often your brand is mentioned.

These analytics can help you make informed decisions about your social media marketing.

Use Your Resources Wisely

It is important to note that not all social platforms are right for your business. For instance, if your audience is primarily on Facebook and Instagram, it doesn’t make sense for you to engage on Twitter because other brands are on Twitter. Instead, focus your attention on where your audience is to increase brand loyalty and engagement. This will help prevent your team from spreading themselves too thin.

Social media doesn’t have to be overwhelming. By employing an effective strategy, understanding where your audience is, and knowing how social media can help support digital commerce organizations of all types, you can successfully market on social media.