What is Social Commerce and How Can Brands Take Advantage?

Social Commerce sounds pretty self-explanatory, right? But it is not just limited to, as a quick Google search may lead you to believe, the ability to make a purchase through a social platform or the act of buying and selling products and services through social media. 


Social Commerce actually refers to any purchase which is influenced by social, whereby the selling is done through people, not owned brand channels. Or as Sadie Hawkins, GM of North America Solutions at TikTok explains: “It’s word of mouth on steroids.” 


Why it’s a game changer

Social Commerce is the next digital shopping revolution and it is transforming our shopping behaviour just as much, if not more, than online shopping and eCommerce did over twenty years ago. It represents a real shift in power from retailers and brands to consumers and it is changing the way brands acquire and retain customers. 


That’s because regardless of age, consumers want to see what other people are saying about a brand, not what a brand is saying about themselves before buying from them. We are increasingly looking for real content, created by real people who we can relate to and trust in order to make better and more informed buying decisions. That could be from family, friends, communities we are part of or authentic brand advocates we follow on social media.


Social Commerce is a game changer because it serves these very needs, providing an enhanced shopping experience that is based on authenticity and trust, not on brand promotion.


The market opportunity

There are over 4 billion people active on social media (that’s 57% of the global population, according to Statista) and we spend on average over two hours a day browsing the various platforms.


And while previously we may have used social media to consume news and connect with friends, we are now using it to shop. In fact, social platforms are becoming so widely used in this regard, they’re starting to threaten the dominance of e-commerce and search giants. Even Google’s Senior Vice President, Prabhakar Raghaven, admitted as much when he said: “In our studies, something like almost 40% of young people, when they’re looking for a place for lunch, they don’t go to Google Maps or Search…They go to TikTok or Instagram.”


So for brands that understand what Social Commerce is and how consumer buying behaviour has changed, the opportunity is absolutely massive. So massive in fact that, according to Accenture, social commerce sales are forecast to increase from $958 billion in 2022 to $3.37 trillion by 2028 and is set to grow three times faster than traditional ecommerce.


Social Commerce Opportunity

Forecasted growth of social commerce sales from 2022 to 2028


It is the future of online retail. It is revolutionising the way we shop and no brand can afford to ignore it.


For those that get it right, social commerce has the potential to become a brand’s biggest revenue generator in the year ahead. So how can brands prepare for this?


1. Know their audience

Social Commerce is changing the purchase journey, creating an experience that circumvents brand-owned channels and one that firmly puts customers in the driving seat. This means brands first need to really understand their target customers, their purchasing behaviours and which platforms they are most active on. This differs significantly by generation.


We know that, according to Latana’s Social Commerce Report 2022, over 50 percent of Gen Z and Millennials are already using social media to discover new products. The same report also states that:

  • 79 percent of millennials say they would consider buying through Facebook, while 68% of Gen X said the same
  • 69 percent of Gen Zers would buy through Instagram and 42 percent through Tiktok
  • 47% of baby boomers would buy through Facebook, with only 2 percent through Tiktok


This shows just how varied platform preferences are by generation and brands need to understand this first and foremost if they are to succeed in the Social Commerce space. For more information on who your brand should be targeting, check out our Future of Social Commerce Report: 2023 and Beyond.


Future of Social Commerce 2023

Download this report here


2. Build a community (of creators)

The fundamental reason Social Commerce is so big is because it is driven entirely by earned content from real people, not from content owned by a brand.


With trust in traditional influencers (the ones that are paid by brands to pretend to like their product) at an all-time low (according to data from YouGov, 96 percent of UK adults do not trust these influencers), consumers are increasingly looking for real content, created by real customers who they can relate to and trust to make better, more informed buying decisions.


In fact, according to a recent survey from Sprout Social, people sited recommendations from friends as the top reason they make purchases through social media, while research from Stackla shows that user generated content (UGC) is 2.4 times more trusted than brand created content.


And so UGC serves as the social proof consumers are looking for and is the key to unlocking the potential of Social Commerce for brands today. And the best way for brands to invest in UGC is to first focus on building a community of loyal brand fans (we call them advocates) and then incentivising them to create and share content with their own followers.  


The most powerful and valuable brands in the world today including Lululemon, Gymshark, Patagonia and Glossier (which have a combined valuation of $43.4 billion), have all grown in this way.


Glossier InstagramGlossier uses its advocates on Instagram to build a community around their brand


They are community-powered brands that have built their own network of loyal brand fans first, who are themselves content creators quick to share videos, photos, reels and stories advocating for the respective brand. These brands do not pay celebrities to promote their product, but instead trust their customers to do it, and to great effect.


3. Drive advocacy

Building a community of advocates and then incentivising them to create and share content on a brand’s behalf is not easy, especially at scale. However, it is going to be fundamental to a brand’s ability to compete in the Social Commerce space in the year ahead.


How can brands engage, celebrate, reward and activate their advocates to share content on their behalf? Here are some ideas:

  1. Power advocacy and loyalty clubs to reward top customers and drive them to further promote and support a brand.
  2. Enable passionate communities of professionals and experts such as hair stylists or sports instructors customers and store teams to promote a brand and recommend products to their online and social networks.
  3. Reward customers with exclusive perks, benefits and exclusive sales for completing activities to support the brands such as content creation, referrals, challenges, surveys, polls and social posting.


British luxury jewellery brand, Monica Vinader, is a great example of a company that is capitalising on the Social Commerce space and driving growth through its own network of advocates with tactics like those listed above. By identifying priority segments within its own brand network – the loyalist customer and the social customer – the company designed and built advocacy programs tailored to each group in order to drive loyalty among them. The result? A core group of super fans who regularly share content on the brand’s behalf and in effect do Monica Vinader’s selling for them.

Monica Vinader ProgramExample of Monica Vinader's brand advocacy program

The time for brands to act on Social Commerce is now, but it is not as simple as just investing more in social media activity or adding the latest shopping widget to their social channels.


Brands that fail to understand how customer buying behaviour has changed or acknowledge the reduced relevance of traditional brand-owned channels leave themselves open to being outsmarted by the competition looking to take their market share in the year ahead.


Brands need to invest in a community-first strategy, that looks to identify and incentivise their own core brand advocates to share content on their behalf. Only then will they be able to truly compete in the Social Commerce space.


For information on how brands can take advantage of Social Commerce, download our Future of Social Commerce Report: 2023 and Beyond.

Brand Advocacy Social Commerce