What is social commerce?

Successful commerce strategies for TikTok, Instagram & the like

Christa Schwandtner | © punkt & komma
Christa Schwandtner
Content management & editor

Have you ever asked yourself how social commerce – i.e., selling products through social media – works? Apart from personalised advertising, customer reviews and live shopping, there are lots of other interesting facts about this topic. In the following interview, our social media expert Chiara answers the most important questions on selling products via the most popular social media platforms.

Everybody’s talking about social commerce. Can you tell us what social commerce means?

Basically, it means selling products and services on social media platforms. Traditional sales strategies are combined with the interaction and community-building aspects of TikTok, Instagram and other social media platforms. For companies – whether they’re big or small – social commerce is an important step towards “social media marketing 2.0“.

Sounds just like social media marketing? It’s not! There are major differences between the two:

  • The main goal of social media marketing is to gain new followers and fans to draw their attention to a company’s products and services.
  • Social commerce, on the other hand, enables direct purchases via or right on the respective social media platform.

What are the benefits for companies that use social commerce?

One big advantage of social commerce is the opportunity to use personalised and targeted advertising on social networks. This works best if you analyse user data and have a clear understanding of your target group’s preferences and interests. After all, the goal of targeted advertising is to address exactly those users who are most likely interested in a purchase. This helps you to cut down on wastage and increases the effectiveness of your advertising campaign.

Do you have any tips on how to boost the credibility of a brand with social commerce?

Other advantages of social commerce are authentic customer reviews and recommendations, which greatly affect purchase decisions. Other people’s opinions help to build trust and boost a brand’s credibility. Customer feedback is a useful tool that should be part of your social commerce strategy.

What’s more, social media platforms allow companies to interact directly with their target group and to build a loyal community. How does it work? With the help of ongoing interaction and engagement! Ideally, this helps you to establish long-term customer relationships that in turn increase the trust of potential new customers.

What does it take for a social commerce strategy to be successful?

To drive sales on social media, companies should make use of conversion-rate-optimised creatives. This means that your images and videos should encourage users to buy. Keep in mind that user-generated content is particularly popular in the top funnel (i.e., for attracting new customers). In this phase, this type of content is perceived as very authentic, generating a higher click rate than classic advertising.

In the field of retargeting, we like to work with dynamic product ads. The algorithm automatically displays those products to users that they have shown the most interest in during previous interactions. Another important factor is the establishment of Instagram shops. They are something like digital shop windows to inspire people.

Of course, any content has to be tailored to the interests of the users to attract their attention.

Live shopping is another trend in social commerce. What do you know about it?

To clarify things, live shopping means the real-time streaming of product presentations or sales pitches via social media or other digital channels. These online events are hosted by influencers, brands or retailers who present their products, with viewers having the opportunity to interact. For instance, potential buyers can ask questions or give feedback on purchased products in real time. Companies, on the other hand, can answer questions or respond to specific customer needs without delay.

A little recap: Live shopping as part of a social commerce strategy …

  • … enhances the shopping experience.
  • … opens up a useful opportunity for direct customer contact.
  • … drives sales. 
  • … raises awareness for your brand and product.

In the USA and Asia, many companies already use direct check-outs. What do you think, will this Meta feature also come to Europe? How could it affect social commerce?

At the moment, there are only rumours about when the direct check-out feature – also known as in-app purchase or social commerce purchase – will be implemented. We can’t wait for it! :D It was announced that Meta and TikTok are working on seamless check-outs in their social media platforms.

The direct check-out feature allows users to directly buy products on the respective social media platforms. This means that you no longer have to visit an external website or create an account in an online shop to complete a purchase.

The advantages: smooth and swift purchases and an improved customer experience.

Do you think that the implementation of direct check-outs will change users’ purchase behaviour?

I believe that the implementation of direct check-outs on Meta will revolutionise social commerce. The feature comes with several benefits that make purchases a lot easier, for instance:

  • faster transactions
  • improved purchase rates
  • higher conversion rates
  • improved customer loyalty

All in all, the direct check-out feature on Meta could be a win-win situation for both vendors and buyers.

And finally:

Can you tell us what conversational commerce is?

Communication between a company and a customer is usually one-way. However, consumers are increasingly looking for ways to interact with a company, ask questions and clear up any doubts they might have.

Conversational commerce means that customers can start a sales conversation with the help of artificial intelligence. Usually, this happens before a purchase or during a transaction via WhatsApp support chats, interaction campaigns or mobile messenger campaigns. This type of artificial one-on-one conversation has proved to increase both the shopping cart value and the conversion rate.

How does conversational commerce work, and what should you keep in mind?

Conversational commerce makes use of WhatsApp support chats, pre-purchase conversations, ongoing concierge services and interactive marketing campaigns. The growing popularity of messaging apps such as WhatsApp and the rise of AI chat functionalities and voice services have paved the way for large-scale conversational commerce. These tools enable a natural interaction between an artificial intelligence and interested buyers. Companies that focus on customer service and interaction in targeted messenger marketing campaigns are rewarded with high engagement rates.

However, one thing should be kept in mind: The customer always comes first. So conversational commerce is all about making users feel heard and understood.

Meet Chiara

Who is the expert in our interview?

Chiara works in Social Media Performance Marketing at punkt & komma. She has more than six years of experience in Paid Social and has been responsible for advertising budgets worth millions. During her career, Chiara has worked with the Meta, TikTok and Pinterest channels of small start-ups and global enterprises. Thanks, Chiara, for answering our questions on this exciting topic!

Sounds interesting?

Would you like to know more about social commerce, or do you need help drawing up a social commerce strategy for your company? Get in touch with our social media experts and benefit from their know-how!

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