Drive to Reimagine

What the heck is social commerce in the first place?

Jeremy DSouza
May 26
4-5 mins

Table of contents

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social commerce

You’ve heard about it everywhere… what what is it really? What is social commerce…. Is it even different from social media marketing at all? I get your confusion and frustration… don’t worry, I’m breaking it all down for you right here. Let’s go!

What on Earth is this social commerce thing?

Okay, lets keep it simple - social commerce involves using social networking sites to promote your products and services and drive sales. But hold up, before you jump to conclusions, it isn’t limited to promoting and selling on Instagram, Facebook, TikTok, and other social media. The concept of social commerce is more expansive, even covering shopping forums, communities, group buying and shopping platforms that have social features allowing shoppers to discuss options.

One of the most important parts of social commerce is that it even makes it possible for customers to make purchases directly over the apps. This makes the buying process substantially easier since they wouldn’t need to switch from one platform to another.

In 2020, the US social commerce market went through the roof, up by nearly 38% to $26.77 billion and by 2023, it’s predicted to practically double, going beyond $50 billion annually.

Growth of social commerce in USA graph eMarketer
Source: eMarketer

The difference between eCommerce and social commerce

eCommerce is a wider concept which focuses on driving sales online on websites, mobile apps, etc. Social commerce focuses purely on driving marketing and sales over social media and other platforms that involve an element of social interaction. 

While eCommerce usually requires the customer to reach a website or mobile app before they can make a purchase, social commerce allows merchants to reach customers where they are hanging out - on the social media platforms and apps that they are spending hours scrolling through. 

Think of it this way - with eCommerce, you’re building a pool and trying to drive fish there before you can catch them, but with social commerce, you’re going fishing in the spots where you know the fish tend to gather.

Essentially, social commerce reduces the friction in the customer journey, thus helping you generate more sales.

Wait… there are types of social commerce? 😳

Yep, you read that right. As I told you earlier, social commerce isn’t limited to social media (even though that’s the most prominent type of social commerce). Wondering what the other types are? Let’s go over them all now.


Social network driven commerce

Social network driven commerce is the commerce that occurs when a customer either reaches an ecommerce site or app after being directed there from social media like Instagram, Facebook, and TikTok or just makes the purchase directly over the social platform itself through an inbuilt shop or marketplace feature.


Commerce on peer-to-peer platforms

Such platforms are essentially community-based marketplaces on which individuals sell to each other. Peer-to-peer commerce can be carried out through an auction-based website like eBay, or individuals can even upload items and set a fixed price for sale.


Social shopping

Social shopping refers to the commerce carried out over online stores that have social features baked into them. One example of these could be online marketplaces that have inbuilt chat features that allow shoppers to talk to each other, exchange opinions and advice. 


Pick list sites

Such sites are a form of user-curated shopping. They allow users to build product lists and share them so that other customers can refer to them and make purchases directly from those lists.


Group buying

In group buying platforms, the website makes it possible for customers to get discounts through economies of scale if enough people commit to making the purchase. If you want an example of such a platform, you just need to look at Groupon.


Participatory commerce

This is essentially crowdfunding or crowd sourcing. Consumers are involved in the production process by voting, designing products in collaboration with customers, and funding production runs.


User review websites

This type of social commerce involves the sales that come through product or service reviews. Peer recommendations are a big driver for eCommerce as a whole and the offer social proof which helps shoppers lose their inhibitions about making the purchase.

Should you bother with social commerce?

Honestly, there are too many benefits for you to skip out on social commerce. But, (of course), I’m not going to leave you with just an assertive statement out there, you already know that I’m going to back it up by going into the actual benefits themselves. Let’s dive into them -


The buying process gets streamlined

Social commerce makes it infinitely easier for customers to buy from your online store. With regular eCommerce, they’d have to either see an ad online and look for your store or just look for a generic keyword before discovering your store in the search engine results pages (SERPs), and then hunt for the products and go through the checkout process. That gives them way more opportunities to reconsider and abandon the purchase. With social commerce, they could literally just see a post about your offerings while they’re scrolling through their favorite social media and make impulse purchases directly over the same social media platform, without needing to hop across to another portal or platform.


You get to build a tribe

Social commerce allows you to rally a community that resonates very strongly with your brand, your products & services, your values, and what you stand for. You could bring it to a point where they aren’t just interacting with your brand, but with each other too. You’ll essentially build a tribe to which your customers and audience feel like they belong, which is a fantastic idea for you, because they’ll even be hyping each other up about your latest releases… and might very possibly end up telling others about your brand too, bringing new members into the fold, increasing your brand’s clout and revenue.


Customer retention goes through the roof

When you engage in social commerce, you also aim to build, nurture, and strengthen relationships with your customers and your entire tribe. Interacting with your customers helps you forge stronger relationships with them, encouraging loyalty in them. 

There’s a caveat here, if you’re engaging in social commerce, you should seek to reply to all their questions as quickly as possible, so that they don’t feel ignored. If you leave their questions unanswered for hours on end, they’d get frustrated and move on to your competitors, never to return. 

Now sure, after you’ve grown enough, it gets hard to keep up with customer queries from across multiple channels. How do you work around that? Simple - deploy an Engati chatbot on your online store and your social media platforms like instagram, Facebook, WhatsApp, etc. The bot can instantly reply to questions across your social media channels, and pull all the conversations into a OneView Inbox so that your live chat agents can take over the conversations if they need to, thus allowing you to increase customer satisfaction and retention.


You can generate and display social proof

People trust opinions from their peers and other customers far more than they trust the claims made by brands. Social commerce makes it possible for your customers to share their reviews with the rest of your community (as well as their own audience). You can even amplify their reviews by reposting them on your social media, allowing you to win your audience’s trust.

Followers, likes, comments, and shares are all powerful indicators of social proof. But social commerce makes it even better when your focus on social media gets your community to post about you on their social media, giving you powerful user-generated content.

So, are you ready to get started with social commerce? Don’t forget to deploy your Engati chatbot across your website and social channels.

Scale up your social commerce with an Engati chatbot

Jeremy DSouza

Jeremy is a marketer at Engati with an interest in marketing psychology and consumer neuroscience. Over the last year he has interviewed many of the world's brightest CX, AI, Marketing, and Tech thought leaders for Engati CX.

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