And while brands and advertisers have relied on social media to promote their products for years, many now realise the benefits of having the entire shopping experience hosted on the platforms themselves.
So which platforms will they choose? Here’s who we expect to dominate live shopping and social commerce in 2022.
TikTok will be the destination for live shopping
Live shopping is still in its infancy in the US, with 2021 revenues of just $US11 billion. But the early success of Amazon Live indicates Americans are willing to explore this aspect of social commerce that’s all the rage in other of the world.
TikTok’s arguably the best place to showcase discoverable and demonstrable products. And with an active US audience numbering over 100 million – 47 per cent of whom say they bought something they saw on TikTok – it’s the natural choice for live shopping.
TikTok has already partnered with innovative brands for successful live shopping events. Here are a few that targeted 2021 holiday shoppers.
- Dr. Squatch: Men’s personal care brand Dr. Squatch targeted female buyers during an hour-long event hosted by lifestyle influencer Madiha Dhanani. Exclusive discounts and limited-time deals drove sales from holiday shoppers.
- American Eagle: The US retailer tapped three brand ambassadors – Addison Rae, Madison Bailey, and Chase Stokes – to promote their holiday collection. The trio’s combined potential reach of 95 million TikTok users and 11-minute average watch time contributed to the event’s success.
- Ulta: The US beauty giant partnered with influencer David Lopez for several successful live shopping events, attracting shoppers with gift card giveaways and last-minute deals.
What about third-party live shopping platforms?
While we expect single brands to leverage TikTok for live shopping, we don’t expect multi-brand retailers – which are historically less inclined to outsource any aspect of the customer journey – to follow suit. Instead, we expect online marketplaces to devote resources to building their own e-commerce ecosystems through native platform features or third-party tools like Bambuser.
Instagram will reign supreme in social commerce
While TikTok will spark consumers’ live shopping sprees, Instagram’s collective popularity with users, brands, and advertisers leaves no doubt it will be driving the overall social commerce market.
With over 200 million Instagram users visiting at least one business profile every day, not only is Instagram the top platform for following brands, but 80 per cent of its users also rely on it to inform their purchase decisions.
Brands continue to flock to the platform, too, joining the estimated 71 per cent of US businesses with an account, while advertisers are expected to increase spending from $US26 billion in 2021 to $US40 billion in 2023.
With its most recent advance in functionality, Instagram has laid the foundation to move beyond spreading awareness and on to actively driving conversions. As a result, it’s onboarding more brands that want to provide a complete shopping experience, in addition to, or instead of, hosting their own e-commerce site. Recent Instagram developments include:
- Instagram Shops: A set of features that allows users to shop business’ photos and videos via a customisable digital storefront. Users can also purchase products influencers have tagged. Alo Yoga is an excellent example of an early social commerce adopter in the fitness category. Influencers regularly tag Alo products in their posts, which only brands with checkout-enabled Instagram Shops can allow.
- Instagram Checkout: Allows users to complete a purchase without leaving the platform, enabling a native shopping experience that includes live shopping.
Instagram couldn’t do it without creators
By now, social platforms recognise that influencers’ ability to drive purchase decisions helps their bottom line, too. That wasn’t always the case. Until platforms started facilitating social commerce, influencers were an entity that siphoned marketing dollars away from them – while on their turf, no less!
Now that their interests are aligned, with driving revenue and in-app purchases for brands as a shared goal, social platforms are rushing to attract influencers by building creator-friendly features and functionality. But since roughly 91.9 per cent of influencers consider Instagram their ideal platform, the others are left to play catch-up.
Aside from being the standard for social media storytelling and spreading brand awareness, Instagram supports creators’ efforts to drive conversions via:
- Product tagging: This allows creators to tag and share their favourite products with their fans while giving brands transparency on the effectiveness of their influencer marketing channel.
- Affiliate opportunities: A native affiliate tool (currently being tested) will make it easier for influencers to connect with brands for product sponsorships.
- Creator accounts: Provide better support for influencers with improved controls and more granular insights into their online presence.
TikTok and Instagram: The twin trailblazers of social commerce
Together, TikTok and Instagram will drive the adoption and expansion of social commerce. Their challenge lies in getting the holdouts to hop on board, including both the brands that are more comfortable with traditional ad placements and the consumers who aren’t quite ready to entrust platforms with the transaction.