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the rise of social commerce:
How Social Media Platforms are Transforming Customer Experiences and Purchase Decisions
expert topic paper
Introduction
Social commerce is rapidly transforming how consumers interact with brands and make purchase decisions, creating new opportunities for companies to stay ahead in a fiercely competitive market. As more consumers discover, evaluate, and purchase products directly through platforms like TikTok, Instagram, and Facebook, modern brands are discovering new opportunities to use digital tools and strategies to boost brand engagement, loyalty, and sales.
This paper explores the rise of social commerce, its impact on customer experiences, and strategies brands and businesses can implement to take advantage of this emerging opportunity.
Social Shopping Is Transforming Commerce
Over the past decade, we have all seen the culture change around us as new digital technologies and platforms create new ways for people to connect and communicate. Commerce is shifting just as quickly to digital and social channels, with a report from Retail Economics and TikTok projecting that the contribution of social commerce to UK retail will grow from £7.3 billion today to £15.7 billion by 2028, driven by a 21% annual growth rate.
This exponential expansion highlights the increasing importance of social commerce strategies for businesses aiming to remain competitive. Marketers are taking note, with 50% reporting that they plan to increase their investment in social selling.
Social Commerce Features Drive Discovery, Engagement, and Conversion
For brands, social media was once primarily useful as a tool for building brand awareness and driving traffic. Today, platforms like TikTok Shop, Instagram Shopping, and Facebook Marketplace allow users to discover and purchase products directly within the app, creating a seamless and engaging customer experience from discovery to conversion and beyond.
These changes are driving accelerated growth in commercial activity within social platforms, with 82% of social media users now engaging in shopping-related activities when using social and entertainment platforms. Even after making a purchase, social media plays a key role in shaping consumer behaviour, with 88% of Gen Z respondents visiting social and entertainment platforms after making a purchase with a retailer or brand to leave a review or share an experience.
This shift has also levelled the playing field for smaller brands, allowing them to compete with larger businesses by reaching global audiences through social commerce tools. These tools support highly targeted advertising, enabling brands to deliver personalised content to specific audience segments and driving higher engagement and conversion rates.
Brands Turn to Video to Transform Customer Experiences
Video content now dominates the digital landscape, with the average consumer now watching 19 hours of online video content per week. Videos can quickly convey information and evoke strong emotions, making them highly effective in motivating viewers to explore new products or adopt certain lifestyle choices.
Platforms that specialise in short-form, engaging videos are transforming the way consumers discover and interact with brands, with platforms like TikTok and YouTube Shorts leading the way and offering innovative ways for brands to connect with consumers.
Brands that leverage these platforms often see their content go viral, leading to increased product interest, brand awareness, and sales. The success of social commerce campaigns, such as influencer-led reviews or viral product challenges, underscores the power of video content in capturing consumer attention and influencing purchasing behaviour.
Live Streaming Connects Brands with Consumers
Live streaming has emerged as a powerful tool for brands to engage with consumers in real time. And it’s growing fast, with Statista forecasting that sales from live online shopping will grow by 36% annually to US $68 billion by 2026.
This interactive format is particularly effective for product launches, demonstrations, and Q&A sessions. It enhances the customer experience by fostering a sense of community and trust, as brands can respond to customer queries immediately and provide personalised interactions. Brands like Sephora and Nike have successfully used live streaming to showcase new products, offer tutorials, and engage with their audiences, resulting in increased customer loyalty and sales.
With 50% of TikTok users reporting that they have purchased a product after watching a TikTok Live, it’s clear that live video is highly effective for driving both engagement and sales, making it an essential strategy for brands looking to create memorable and impactful customer experiences.
Influencer Partnerships Open New Opportunities for Brands
Influencers have become essential players in social commerce, playing a pivotal role in shaping consumer opinions and driving sales. By partnering with influencers who align with their brand values, brands can enhance credibility, reach new audiences, and create deeper connections with their target audiences, leading to higher engagement rates and improved brand loyalty.
Social Listening and Brand Monitoring Are Critical for Success
Social commerce brings many exciting new opportunities for brands, but with those opportunities also come new risks. With nearly 75% of consumers counting on word of mouth to inform their purchases, a single negative review or unflattering slip-up on social media can quickly go viral and cause lasting damage to your brand.
To minimise these risks, it’s essential to manage your customer reviews and monitor brand mentions, competitors, hashtags, and more across the internet. Adopting reputation management and social media management software, such as InMoment and our partner Hootsuite, can help you stay ahead of potential issues while amplifying your positive feedback.
With InMoment Reputation Management, brands of all sizes can effectively uplift their online reputation and sales by managing, aggregating, and engaging with customer reviews across more than 120 review sites and platforms. As the price of your products increases, the importance of reviews grows. Spiegle Research Center reports that when higher-priced items display reviews, the conversion rate increases by 380%.
It’s clear that reviews drive new revenue, but they also impact customer retention. Ignoring feedback can leave customers feeling undervalued, especially when it comes to negative reviews. However, responding to reviews—whether positive or negative—shows that you care, and can even turn a dissatisfied customer into a loyal one.
Reviews also serve as key indicators of customer satisfaction, and when combined with other experience signals– such as surveys, CRM notes, chats, call centre data, etc.– they provide richer insights that guide smarter, more impactful business decisions. InMoment’s Integrated CX approach empowers brands to listen and truly understand their customers, so they can deliver the experiences that keep them coming back.
Hootsuite Listening delivers the broadest social listening data coverage on the market, enabling you to monitor mentions across up to 150 million websites, 30 social media channels, and 187 languages. You can track sentiment to identify positive and negative feelings around any topic or brand, set up real-time data alerts, easily investigate spikes, and monitor key issues as they unfold, ensuring you’re ready to react in real-time to crises, fraudulent claims, and misinformation.
When brands pair InMoment with Hootsuite, they unlock a powerful duo that amplifies their online reputation and social media engagement, fostering new business opportunities and increasing customer retention.
Conclusion
The rise of social commerce marks a transformative shift in how consumers discover, engage with, and purchase products. Social media platforms, particularly those focused on video content are leading this change, offering brands new ways to connect with customers and drive sales.
By embracing these trends and investing in the right strategies, businesses can enhance customer experiences, build brand loyalty, and secure a competitive advantage in an increasingly digital and interconnected marketplace.