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June 17, 2022
Just as the name suggests, Social Commerce is a type of eCommerce that is carried out via social media channels like Instagram, TikTok, and Facebook. Customers can interact directly with brands, check out their products, and make purchases. They can check out either from the social platform directly or go to the merchant’s page where the checkout can be completed.
Basically, it is an online commerce that leverages any type of social interaction to convince users to buy things.
1. Video commerce – involves interactions with multiple users via live streaming or pre-recorded videos, just like TV shopping but with the added option of real-time interaction with the influencers where the audience can ask questions about the product.
2. Social reselling – conversation or chat-based commerce where traditional retailers become ‘resellers.’
3. Group buying or community buying – one consumer, refers others in their network or community to get bargains and increase savings on the purchases.
Over the years, social commerce has seen quite a rapid growth in the world.
In China, Livestream shopping has disrupted traditional eCommerce since 2015. The number of live streaming users reached 433 million in July 2019, accounting for more than 50% of Chinese internet users.
C. The social commerce market is expected to reach $16 billion GMV by 2025, according to the BAIN Sequoia Report, and the total share of social commerce in the country’s eCommerce market is expected to rise from 1-2% to 4-5% of the total projected $140 billion markets by 2025.
Globally, social commerce opportunities will almost triple by 2025, according to an Accenture report.
D. Growing at a CAGR of 26%, the market will reach from $492 billion in 2021 to $1.2 trillion by 2025. This is about 16.7% of the total $7 trillion eCommerce market.
Livestreaming in China has gone to another level, with influencers making millions within one streaming session. Top influencers sell millions of dollars worth of inventory every night.
1) Austin Li Jiaqi, the Lipstick King, is one such influencer in China who sold 15,000 lipsticks within 5 minutes of live streaming.
2) China’s ‘live streaming queen,’ Via, even sold a rocket launch service on Taobao (the top live streaming app in China) for 40 million yuan (almost $6 billion)!
Web3: Metaverselands, NFTs – Nikeland is Nike’s metaverse space where fans can meet, socialize, get new brand experiences, and be a part of the latest promotions. Since its launch in November 2021, more than 7 million users have visited the Nikeland to meet their favorite stars like LeBron James and buy exclusive digital products for their avatars. Every one has their own space to show off their collectibles. It has also acquired RTFKT Studios, a maker of NFT collectibles to create customizable Nike sneakers as customers want personalized goods instead of mass-produced. CryptoKicks Dunk Genesis is a customizable NFT sneaker from Nike that users can customize with skin vials created by different designers.
Integrations into Social Media: TikTok has integrated with Shopify to increase the platform’s social commerce market. With this partnership, Shopify merchants will be able to create TikTok content for their products directly from their shop dashboard, giving customers a better shopping experience.
VR/AR Social Shopping: Nike also offers customized sneakers to try virtually with a digital overlay on the feet with the Nike’s AR shopping experience using Snapchat lens filter.
Shop Ulta Beauty and MAC Cosmetics through Snapchat’s ‘catalogue-powered’ shopping lens that links directly to the brand’s catalogs. Over a two-week period, Ulta generated $6 million in sales and more than 30 million product try-on, while MAC’s shopping lens was tried on 1.3 million times.
Credits: Anyaa Mittal
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