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The sharing economy: turning social media posts into sales

As Pinterest announces a range of new commerce features, Drapers explores how social media platforms are evolving to make it easier than ever to sell directly to customers on these channels.  

The mix of commerce focused updates revealed by Pinterest in the US this week include buyable “pins” that users can click to purchase items on the site, and a digital shopping bag that follows users from their desktops to their smartphones or tablets.

As the number of social media users worldwide climbs into the billions, platforms such as Facebook (1.09 billion daily users), Instagram (more than 300 million daily users) and Snapchat (more than 100 million) are all striving to maximise their commercial potential and give retailers and brands on the platforms a clear measurement for return on investment (ROI). 

“Social commerce, as it’s being called, is going to see quite significant growth in the next couple of years,” says Paul Martin, director of insight at business consultancy KPMG Boxwood.

“There’s absolutely a desire from customers to be able to buy directly from social media. For younger customers especially – but not exclusively – being able to buy when and where you want is more and more important.”

In 2015, Facebook-owned picture-sharing app Instagram added a “shop now” button to sponsored posts. This redirects users from the app to a brand’s website and has been used by Sainsbury’s Tu. It also increased the length of video ads from 30 seconds to 60 at the same time. Earlier this year, the app introduced video carousel ads, which allow users to swipe left on an advert to see more content and link to the brand’s website. Retailers also now have the ability to turn particularly well-performing posts with multiple shares into adverts.

Facebook itself has gone down a different route, but one that gives retailers who buy advertising on the site a more measurable ROI. Retailers and brands can now include an interactive map displaying their physical store locations as part of a carousel ad, so users can find their bricks-and-mortar stores. Facebook will then use the phone’s location services to track how many users who saw the ad actually visited the store.

Both Facebook and Instagram have also continued the roll-out of dynamic ads that automatically promote items that users have expressed an interest in or are related to products they have purchased previously.

Fast fashion retailers trying to reach a younger, digitally savvy audience have been quick off the mark when it comes to embracing social commerce. Asos was one of the first retailers to use Instagram’s new carousel ads, and etailer Missguided recently announced it has made all of its “snaps” on Snapchat shoppable. Snapchat is also testing the inclusion of adverts between users’ “stories” and allowing viewers to swipe up on adverts for the opportunity to watch a longer form video.

Martin says social commerce can pay dividends for retailers: “A customer’s journey starts with inspiration, moves into planning and making the transaction and ends with feedback or returns. Then retailers have to close the loop and take customers back to inspiration. The beauty of social commerce is that you can combine multiple steps of the customer’s journey and go straight from where they find inspiration to the transaction.”

Without the groundwork, a sponsored post is little more than an unsolicited phone call

Rohan Moore, managing director of Olive Clothing

Rohan Moore, managing director of womenswear brand Olive Clothing, stresses that, although he has seen strong results from sponsored posts on Instagram, simply buying an ad is not enough: “Sponsored posts work for us because we’ve invested extensively in building a social audience for our brand, understanding who our customers are in the digital world and curating the content they’re most likely to engage with. Without the groundwork, a sponsored post is little more than an unsolicited phone call. With the groundwork, you’ve got a highly targeted advertising method.”

Olive Clothing

Olive Clothing

Olive Clothing makes use of Instagram to drive purchases directly

However, not all retailers are convinced by social commerce.

Qasim Akhlaq, managing director of footwear etailer Public Desire, says he still prefers customers to buy directly from the company’s website. “Social media is absolutely massive for us. However, we want customers to complete their journey on our website. Apps like Instagram are great for building a community and for day-to-day interaction with users, but the experience of buying from social media is very limited. On our website, we can offer customers promo codes and free shipping, and show them new styles. They get the full journey.”

There is also no guarantee that social media users will pause their scrolling to engage with sponsored posts. In fact, Amber Atherton, founder of jewellery brand My Flash Trash and social media influencer, points out that some consumers are turned off by adverts appearing on their social media feeds. 

“Digital ads distract from user experience and generally leave a negative brand impression,” she asserts. “A more authentic way for brands to use social media to sell directly to customers is to invest in creating amazing and consistent content and spend time interacting with your audience.”

Brands have to recognise that they’re entering into intimate relationships with consumers when trying to sell through social media

Jonathan Openshaw, editor of future consultancy The Future Laboratory

Atherton’s thoughts are echoed by Jonathan Openshaw, editor of future consultancy The Future Laboratory: “Brands have to recognise that they’re entering into intimate relationships with consumers when trying to sell through social media and there’s still a ‘church and state’ attitude among some, who see any blending of social and commerce as an intrusion.” However, he adds, this attitude could soon become extinct among younger consumers: “We’re finding that younger demographics are much less threatened by brands operating in their social space, as long as the content is quality and the perceived payoff is right.”

Social commerce can be a powerful tool for retailers who want to engage the younger customer, but it is clear a balance must be found between allowing users to shop on these platforms if they wish and bombarding them with adverts.

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