The 2014 holiday shopping season is underway and as marketers gear up to capture a piece of the $617 billion of expected sales predicted by the National Retail Federation, it is important to understand how this year’s retail landscape has drastically changed. In two words: social commerce.
First it was Facebook, then Pinterest and now Twitter, the latest platform to unveil direct-from-social commerce options, today’s retail landscape is one in which consumers can effectively make purchases with the ease of a “like” or double tap from many platforms. As the holiday season quickly approaches marketers are quickly looking for ways to harness this new opportunity. We even see that social marketing and commerce budgets are growing, with companies expected to spend $8.2 billion on social media advertising in 2014, representing an increase of 32.2 percent over 2013, according to a report by Research and Markets. More proof that marketers are recognizing the power of social commerce.
Yet, as social media has quickly evolved into a commerce channel, savvy digital marketers may be questioning what lies ahead when it comes to informing their digital marketing strategies this holiday season and beyond.
Will social commerce continue to rise, or is the influx of platform-by-platform buying options a flash-in-the-pan fad with web commerce remaining everlasting hero? Our bets are on the merging of the two and believe that the future of commerce lies in an omni-channel approach. One that harnesses the power of user-generated content (UGC) in tandem with traditional ecommerce channels such as web and mobile sites. Let’s dissect why.
The driving force behind social commerce is clearly the Millennial generation, the next generation of digital natives – those who grew up with a device in their hands – who are ushering in an entirely new shopper journey. These audiences are accustomed to ingesting news and information socially and are influenced by user-generated content 50% more than other types of media to inform their shopping decisions. Brands have embraced this consumer behavior and found ways to reach them through their new native language that is social media.
However, there is one inherent problem that must be addressed before jumping on the social commerce bandwagon. As brands are increasingly viewing social media as a sales channel and begin pushing sales outward across social channels and away from traditional ecommerce sites, they are giving others control over their success. For instance, when Facebook recently changed its algorithms to suppress “click-bait” headlines, the many media organizations that relied on this formula quickly became disadvantaged. The same could happen for retailers relying too heavily upon one social channel as a sales vehicle.
The solution, on the other hand, is in the ability to harness the power of social media by pulling in UGC from any social platform and leveraging that content to help merchandise products and drive traffic to traditional e-commerce sites. Google reports that online shopping is the new window shopping, with visual social media sites like Pinterest becoming the new ‘digital window displays.’ And as the lavish window displays made famous by Macy’s served to pull shoppers into their stores, today’s digital window displays must do the same. For instance, those expertly pinned Pinterest boards and ‘outfits of the day’ shared on Instagram should serve to engage and inspire shoppers and then – you guessed it – pull them inside to your digital store.
Two brands that are successfully merchandising their digital window displays are Nordstrom and Sephora. Through Nordstrom’s new “Like2Buy” application, shoppers can browse Instagram for inspiration and “like” a photo to show purchase intent. From there, shoppers are brought back to Nordstrom’s website with all of their favored items in one place for direct purchasing. Sephora, on the other hand, optimized the power of user-generated content with its “Beauty Board” application, which pulls user-generated photos of its makeup products on users via “selfies” into a microsite where users can shop looks directly from social media inspiration.
The common theme? Both programs use social media content to engage shoppers, but ultimately direct them back to owned e-commerce channels. The key lies in using UGC to pull in consumers, versus pushing sales outward to less controlled environments. Brands today must curate UGC from brand enthusiasts and influencers and then disseminate that content across multiple channels – to brand websites, to store associates and to local microsites using new geo-tagging features.
So, as social commerce buying options continue to infiltrate consumers’ social feeds, it’s imperative to use that social content to work in harmony with traditional ecommerce efforts. That is, pulling the best of what social media has to offer – passionate users and personal brand connections – and using that content to better merchandise your product or service to grow sales. It is marketers who ensure that their digital window displays are effectively driving shoppers inside their stores who will reap the rewards this holiday retail season.