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It’s a social thing: leveraging social media to bolster retail sales

March 6, 2019
It’s a social thing: leveraging social media to bolster retail sales

Concept of social commerce evolving as it grows

BY DENISE DEVEAU

FINDING the right platforms for engaging customers during their shopping journey has become an increasingly tangled web. When social commerce started taking hold in earnest around 2016, the advertising and marketing options facing retailers increased exponentially.

In simple terms, social commerce is using social media platforms to advertise or direct sell products to consumers. While the notion seems straightforward, it can be a complicated business for retailers.

PayPal Canada 2016 research reveals that Canadians are warming up to social commerce, indicating that 26 percent of Canadian shoppers have already engaged in social commerce and 45 per cent said they would consider it. About 7 per cent of Canadian online shoppers would consider buying a celebrity endorsed item on social media, with Millennials specifically tracking at 13 per cent. And one in three Canadian online shoppers said they would consider buying an item directly from a brand’s advertisement on a social media platform if recommended by a peer.

A Gartner2 report Social Platforms and Influencers 2018 found that 66 per cent of 424 brands are using social media to create awareness, drive transactions and provide customer service. About 41 per cent of those brands have adopted shoppable content options from Instagram, while 17 per cent were making use of Facebook’s shoppable brand pages.

Not surprisingly, the juggernauts—Instagram, Facebook and Twitter—account for more than 90 per cent of social media interactions. Snapchat is carving out a small niche as a specific draw for the younger demographic (18 to 22), while Pinterest is providing a slightly different take on the theme, says Robyn Henke, a consultant specializing in social ads. “Pinterest is interesting because it’s a great traffic generator but not a good sales tool. So as a retailer you would not focus on purchases but on getting traffic to your site where you can nurture a relationship.”

Beyond the platforms, social commerce comes with many options that retailers need to understand, from ‘buy now’ buttons to tagging content to third-party plug-ins to facilitate ordering and payment processes on social media sites.

A driver behind social commerce growth is the available technology that allows retailers to deliver a seamless purchasing experience. “One of the biggest things has been the rise of mobile interaction,” says Neha Goel at Venmo, a mobile payment service provider. “Consumers are increasingly wondering why they need to jump through extra steps to interact with brands they encounter on social media. Facebook and Instagram are great for that.”

Social commerce is not always about triggering a purchase. In some cases, it can be designed as a means to drive consumers to explore ideas, learn about products or even encourage in-store visits. This is an area where retailers often need guidance.

“There are a lot of pre-conceptions with retailers coming onto a platform,” Henke says. “They have a full sense of confidence they know how to do it. But it’s a completely different world from paid campaigns on platforms like Google. They think they’re similar but they’re not.”

She distills the difference to the fact that social media is not a platform of intent but a platform of discovery. “It introduces people to a concept, product or brand before you come out and ask them to buy.”

Where to start

When working with retailers, Lisa Montenegro, partner with DMX Marketing, cautions them to avoid eliminating conventional channels in favour of social commerce exclusively. “People come to us wanting to drop their website and go to a social media base. But it’s way too early for that.”

She also strongly advises that retailers not put all their eggs in one social media basket. “Very often retailers come in seeing the trends and asking to just be on Instagram for example. You still have to have a varied strategy because your demographic will not all be in the same place. You should still be on Facebook and others, as well as have an eCommerce site of your own.”

It’s important to keep in mind that each platform appeals to different demographics and tastes, Montenegro adds. “Instagram for example is friendlier to apps used by influencers making their profiles shoppable.”

Yet, retailers need to understand that the choice of influencers is shifting as social commerce takes hold. “One thing I’m seeing with Canadian audiences is that they are becoming really aware of the fact that influencers are paid for their opinion,” she notes.

Influencers won’t be going anywhere, but the attitudes have changed, Henke confirms. “Retailers will continue to work with them forever. But the optics have taken a beating with events like FRYfest so there is a noticeable shift from mega influencers to smaller ones. Aritzia has chosen to work with Instagram influencers with less than 2,000 followers. This has allowed them to develop personal relationships with strong followers that had unique positions on things.”

Connecting the dots

The most powerful aspect of social commerce is its ability to draw on and respond to the different stages of the customer journey, Henke says. “Combining data on a person’s shopping journey in tandem with social commerce—that’s where it gets powerful.”

Retailers can identify a wealth of different activities in social media and use other channels to continue the conversation, she explains. “Maybe they’re on Instagram but not able to make the purchase at that time. The next step is to capture that moment on the desktop or other channel and pick up where they left off with features like auto form fill.”

“It [social media] introduces people to a concept, product or brand before you come out and ask them to buy.”

ROBYN HENKE
Retail consultant

“YouTube is becoming the number one way to get the message out while entertaining people at the same time.”

LISA MONTENEGRO
DMX Marketing

26 percent of Canadian shoppers have already engaged in social commerce. 45 percent are considering it.

Source: PayPal Canada

Rest assured that consumers will give retailers buying signals along the way, she continues. “There are so many different levels of interest that can be derived from social. You can segment your approach to a very granular level.”

This now means content should be segmented into possibly hundreds of tiny pieces so retailers can tap into specific consumer bases. “Simply creating single campaign content with high production values, and employing a bunch of large influencers to push messages really doesn’t work anymore. It doesn’t have to be high production or expensive material. A person doing a short iPhone clip actually works better.”

2019 and beyond

Moving forward, Henke says there are a few themes for 2019 that will be important for anyone stepping in to the market. First and foremost, “Everything you do should be real. Consumers on social media like to see imperfect people; not airbrushed models or things looking fake. That doesn’t take anymore.”

The best social ads capture scenarios or feelings that are common in society, Henke explains. “I saw one nine-second Target ad for disposable razors showing a woman wearing ripped denim pants, shaving the exposed parts of her legs with a razor. That’s something real women do and applies to people in a very real sense.”

Retailers should not discount the power of video when reaching out to consumers in future, Montenegro says. By 2020, online video will be 80 per cent of internet traffic, which could influence social commerce strategies. “YouTube is becoming the number one way to get the message out while entertaining people at the same time. There are even shoppable videos but for now Canadians are more likely to watch and do further research on the retailer’s website.”

Last but not least, authenticity is key, Henke says. “Consumers are wiser today and know better than to take something at face value. You need to have conversations with them around a lifestyle, an improvement in some issue they have, or something that adds value to their lives, without being intrusive or obvious. That’s where you find the sweet spot. Treat them with respect and you will get further than shouting out messages.”

1 in 3 Canadian online shoppers would consider buying an item directly from a brand’s advertisement on a social media platform if recommended by a peer.

Source: PayPal Canada

66% per cent of retail brands using social media are leveraging it to create awareness, drive transactions and provide customer service.

Source: Gartner2 Social Platforms and Influencers 2018 report

41% of brands using social media have adopted shoppable content options from Instagram. 17% are making use of Facebook’s shoppable brand pages.

Source: Gartner2 Social Platforms and Influencers 2018 report

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