Global social commerce, shopping via social media platforms, is going to grow three times as fast as traditional e-commerce from, 492 billion to 1.2 trillion US dollars by 2025, according to a new report from Accenture.
Today, 10 percent of all e-commerce spending is done via social commerce, and in the next three years, this number is expected to reach 17 percent. This growth will be driven primarily by Gen Z and Millennial social media users, adds Accenture, who will account for 62 percent of global social commerce spend by 2025.
Accenture’s report, ‘Why Shopping’s Set for a Social Revolution,’ shows that 64 percent of the 10,053 social media users in the UK, US, China, India, and Brazil surveyed said that they had made a social commerce purchase in the last year. This means that the entire shopping experience, from product discovery to checkout, took place on a social media platform. Which Accenture estimates to reflect nearly 2 billion social buyers globally.
Robin Murdoch, global software and platforms industry lead at Accenture, said in a statement: “The pandemic showed how much people use social platforms as the entry point for everything they do online — news, entertainment and communication.
“The steady rise in time spent on social media reflects how essential these platforms are in our daily life. They’re reshaping how people buy and sell, which provides platforms and brands with new opportunities for user experiences and revenue streams.”
Social commerce expected to reach 1.2 trillion US dollars globally by 2025
The report notes that the top social commerce category globally is expected to be clothing in 2025 (18 percent of all social commerce by that date), followed by consumer electronics (13 percent) and home décor (7 percent). The beauty and personal care category, although smaller in terms of total social commerce sales, is predicted to quickly gain ground on e-commerce and capture more than 40 percent of digital spend on average for this category in key markets by 2025.
Accenture also adds that consumers in developing countries are more likely to use social commerce and do so often. Eight out of 10 social media users in China use social commerce to make purchases for a given category, while the majority of social media users in the UK and US have yet to make a purchase via the channel.
The report also states that shoppers in China, India, and Brazil care more about features that help them discover and evaluate potential purchases, while those in the UK and US place more importance on pricing and discounts.
Oliver Wright, global consumer goods and services lead at Accenture, said: “Social commerce is a levelling force that is driven by the creativity, ingenuity and power of people. It empowers smaller brands and individuals and makes big brands reevaluate their relevance for a marketplace of millions of individuals.
“Getting social commerce right will require creators, resellers and brands to bring their products and services where the consumer is, and will be, rather than the other way around. It means working together within a dynamic ecosystem of platforms, marketplaces, social media and influencers to share data, insights and capabilities to deliver the right incentives and best consumer experience across an integrated digital marketplace.”
However, half of social media users surveyed indicated they are concerned that social commerce purchases will not be protected or refunded properly, “making trust the biggest barrier to adoption, as it was for e-commerce at its beginning,” explains Accenture.
Trust is more important to older generations than younger shoppers, explains the report. Older shoppers emphasise security features and value brand familiarity, while younger generations are attracted to livestreams and put more faith in buyer reviews.
Wright added: “Those who have yet to use social commerce say one reason they are held back is their lack of trust in the authenticity of social sellers, while active social commerce users point to poor policies on returns, refunds and exchanges as an area for improvement. Trust is an issue that will take time to overcome, but the sellers who focus on these areas will be better positioned to grow market share.”