If you’ve been on Instagram within the past year, you’ve probably noticed that shopping bag icon on the bottom of your screen. Such is a form of social commerce, where consumers can purchase items directly from a brand without having to leave the app itself, from browsing to checking out.
To put it simply, social commerce is the act of selling physical products via social media—think Instagram Shopping or Facebook Shops.
On the other hand, e-commerce is essentially an umbrella term to outline all forms of online purchases for physical products. In this piece, we’ll be using the term to describe shopping through third-party sites like Lazada and Shopee.
Is there one that’s better than the other for an SME or microbrand? We take a look at some features users have to come to expect from the online shopping experience and see how social commerce and e-commerce fare against one another in those.
Instantaneous Transactions Via Ads
As mentioned, social commerce means the entire shopping experience from browsing to checking out happens on social media itself, and consumers won’t have to leave the platform whatsoever.
For brands, products can be pushed out in a more seamless manner as customers won’t be redirected to different sites. To add, they won’t have to create new accounts just to make a purchase, which may lead them to abandon their carts.
So whenever they see an ad on their social media feed, they can simply click on it, fill in their shipping details, and boom—that item will be on its way.
However, if you’ve ever clicked on your Lazada or Shopee recommendations on Facebook, you’re probably familiar with the annoying loading times required just to view that product on the site. More often than not, you may not even land on the brand’s page, but the home page instead.
If you’re already browsing third-party e-commerce sites though, then it’s no surprise that transactions would be seamless and quite instantaneous as well, but people tend to spend more time on social media than such sites.
Keeping Customers Up To Date
Since social commerce is done through social media itself, customers have a direct way of connecting with brands and staying up to date with new product launches, promotions, and the like.
Additionally, if they have any questions about the products, doubts can be clarified straight from the source with a comment or DM, which are usually seen and replied to faster. This can lead to customers hitting that checkout button more confidently without having to sleep on it first.
On the other hand, brands cannot really depend on third-party e-commerce sites to let their customers know that there’s been a new product launch or a discount on certain items.
Customers would only find out if they’re already actively looking for such a product, which means the visibility of your brand’s activity is much lower in general, leading to slower traction and conversions.
High Reach And Engagement
Word of mouth is powerful. If you’ve read most of our startup features, you’ll notice a common trend. Most of them started out with just a handful of followers-cum-customers who shared their praises about a brand and eventually converted their own friends into customers too.
With social commerce, consumers can broadcast photos or videos in the form of posts and stories. When they tag the brand they’ve purchased from, their followers will see it, and have the access to explore and research your brand’s profile, which may convert into sales.
Brands also have a clearer idea of who their audiences are as customer data on social media is available through the site’s analytics. Hence, brands can tweak their ads to target specific customers, or perform split tests to figure out which kinds of messages drive better sales.
For e-commerce sites, you’d mainly see people raving (or complaining) about a product in the review section, but the people who’d see those messages are only other customers who are already looking at the product.
Sure, if someone likes the product enough they would rave about it on social media too, but if you’re a smaller or newer brand that doesn’t make your social media handle easily known, it’s rare that users would put in the work to find and tag you.
Usability Of Search Functions
Unless a user is able to identify a brand’s exact user handle or hashtag for their products on social media, it’s a hassle for customers to find the exact product they’re looking for. It’s a sentiment shared by the founder of Poptron, an e-commerce site for microbrands, too.
E-commerce sites have helpful search engines, as it’s a norm for sellers to name their items with every possible keyword that applies to a product. Would I find the exact “hard clear case Samsung S10e phone case” I need on Shopee? Yes, and I may also discover something else I didn’t know I needed to lower my shipping cost, like a wireless charger which is now making its way to me from China.
If I tried to input the same keywords on Instagram’s Shops, I’d be met with a “No Results Found” message. But if I simply searched with “phone case” as the keywords, a few brands would be suggested to me, where I’d have to browse through each of them just to find the exact product I have in mind.
For a picky and impatient shopper like me, the latter’s discoverability is infuriating, which earns e-commerce a point in this category.
Transparency Of Customer Satisfaction
Vanity metrics are numbers that look spectacular on the surface (like your follower count and engagement rate) but don’t necessarily translate to meaningful business results (sales).
When you rely on social commerce, you may quickly get excited about the likes and comments you’ve received. However, these numbers may not actually convert to successful sales, even if you’ve promoted your products through paid ads or had a post that went viral.
People don’t tend to leave very helpful comments (out of love or dislike for a product) on a brand’s social media, and overall, it’s quite difficult to tell who in the comments is an actual customer, or just a fan of the product’s pretty branding.
For e-commerce, if a product listing has high ratings and a large volume of sales, it’s an immediate sign that customers who’ve bought it love it. Other people would then be more likely to make the purchase from your brand too.
Perhaps the biggest advantage for social commerce is that it’s bringing the whole online shopping experience to spaces where people are already hanging out. On average, people across the globe already spend over 2 hours per day on social media, and you can bet there are those who spend even more time on it.
This means an easier reach towards a lot of potential customers, and brands should at least begin equipping themselves with the knowledge on how to use these social commerce tools before they get left behind. As mentioned, e-commerce websites (whether a brand’s own or a third-party one) still have the benefits of a better search function, but in time, we won’t be surprised if social media sites adopt that feature too.
But this doesn’t mean that third-party e-commerce sites have their work cut out for them. They still offer new and growing brands a lot of advantages, as we explained here.
In any case, the full shopping process on Instagram is only available in the US, not Malaysia. Throughout my own Instagram Shopping spree, it seems that I still have to view the product on the brand’s actual website and make my purchase there.
So for now, if you don’t think it’s worth setting up your micro-brand on third-party e-commerce sites due to transaction fees, you could first default to the classic, “DM to order” and grow your social media user base in preparation.
- You can read more online shopping articles we’ve written here.
Featured Image Credit: Vulcan Post