Long the norm in China, social e-commerce, shopping via platforms such as TikTok, YouTube and Amazon Live, may soon see similar success in the West.
Social shopping and online sharing are blending and live social networking is finding audiences outside of China, writes Reuters.
“ByteDance-owned TikTok introduced the concept in the United States and Britain to replicate the success of Douyin. Its Chinese sister app enabled goods valued at 119 billion dollars to be sold in 2021,” said Reuters.
Online retail behemoth Amazon isn’t one to stand on the sidelines, launching a similar concept called Inspire.
Live online shopping revenue will help offset shrinking marketing budgets, with U.S. social media advertising spending growing at around 30 percent a year, data from Reuters said.
In October McKinsey published similar insights, stating shopping directly via social media platforms is a core feature of e-commerce in China and now this new way of buying is poised for rapid growth in the United States.
In 2021, 37 billion dollars in goods and services were purchased through social-commerce channel in the US. A figure expected to reach 80 billion dollars by 2025.
Influencers are key
When influencers tout products via live-stream shopping events, conversion rates hit nearly 30 percent, according to McKinsey. This is up to ten times higher than conversion in conventional e-commerce.
Social shopping is a relatively new revenue channel for brands, and consumers are spending more time than ever on social channels and digital platforms.
Whereas in social commerce brands do not have the direct relationship with customers, as they do with e-commerce, the win-win is that shoppers discover and buy products in one medium, where marketing and retail channels are merged into a single dynamic universe, says McKinsey.