The future of social selling and marketplaces is today; how can brands leverage this opportunity?

In just a few short years, shopping journeys have evolved from what was traditionally ‘search, click, buy’ to more continuous cycles of activity. With potentially dozens of different influences going into the decision-making process, consumer journeys are now longer and more complex and often spanning multiple channels.

In the words of Instagram’s Director of Product Vishal Shah, as buyers navigate marketplaces, social networks and brands’ own ecommerce sites, it’s “no longer a linear journey, it’s not even a funnel – we actually refer to it as a noodle”. These trends have only accelerated as a result of the rapid digital adoption that the Coronavirus lockdown has brought about.

According to recent ChannelAdvisor research, for example, a quarter of consumers have bought something from a retailer that they wouldn’t have shopped from before. More dramatically, according to Shopify’s Chief Operating Officer Harvey Finklestein “the world that would have existed in the year 2030 has been pulled into 2020”.

Brand investments have brought the future forward

Part of why this future exists today is down to the giant leaps that brands have made in responding to rising digital demand. According to L’Oréal’s Chief Digital Officer Lubomira Rochet, it achieved “in eight weeks what it would have taken three years to do”, with the company now receiving 20% of its revenues from branded sites or retailers like Amazon.

L’Oréal is the tip of the iceberg with brands attracted by the strong performance, audience reach and ability to deliver relevant, contextual marketing messages through such channels. Indeed, according to the fifth phase of Econsultancy’s Covid-19 impact research, 60% of agencies agreed their clients were increasing their investments in social to capitalise on the opportunity.

Against shrinking marketing budgets, social’s appeal is further strengthened by sophisticated retargeting. This enables brands to target customers that might have abandoned their shopping basket before checkout with relevant messaging that encourages them to complete their purchase, thanks to the in-depth understanding that platforms have of their logged-in users.

Making the most of a global marketplace

Another reason for brands to celebrate social commerce and marketplaces has been the ability to scale beyond their immediate shores – of resonance to marketers that might be looking to solidify demand at home. According to May 2020 ONS figures, for example, overall UK online spend is down by 13.3% compared to the same three-month period to May 2019.

In the case of marketplaces, most brands start on Amazon and eBay, according to recent research by ChannelAdvisor. But executives also need to consider the category advantages of players beyond these two stalwarts. For example, if you’re a fashion brand, Zalando’s 27 million-strong urban fashion consumers are drawn to the platforms by 400,000 product choices and almost 2,000 brands.

Likewise, on social networks brands often start out on Facebook, but each platform has unique user behaviours and features. Instagram, for example, drives sales with creative, visual shopping ad formats. By comparison, TikTok might suit brands looking to express their more playful side with short-form video while Pinterest can enable discovery and create desire with branded mood boards.

Increasing opportunity, but also complexity

Typical paths now include dozens of different influences. What’s more, customers are increasingly passive, casually looking for lifestyle upgrades that might offer greater utility. With customers scrolling through their heavily populated feeds at speed, the decision to buy from brands can just as equally be instantaneous as consumers look for instant gratification and social cachet.

Perhaps unsurprisingly, when asked about the most important factors to get right in a recent study, 17% of commerce leaders surveyed for Wunderman Thompson’s Digital Commerce Leader Report 2019 cited a ‘balanced strategy’ that incorporated not just retailer sites, but also being present on competing marketplaces such as Amazon, direct to customer (D2C) and social commerce (the most popular response, ahead of ‘customer experience’ at 15%).

This way of thinking is reflected in Revlon’s ‘omni-ecosystem’, featured in this piece from Forbes, where each channel meets a different customer. As the diagram illustrates, pureplay specialists have the advantage of close consumer relationships and high category relevance, but they lack scalability compared to Amazon. With that said, scale isn’t everything: as Revlon’s Head of US Marketing and Engagement, Oshiya Savur, told Forbes, “coffee filters [on Amazon] appear in the same way as a lipstick – the romance is lost”.

Managing consumers’ complex content needs is a challenge

Brands see significant opportunities to be present across multiple platforms, but this needs to be orchestrated to provide a consistent brand experience to the end user. But even for organisations with established ecommerce operations, according to one recent study, only 17% of brand leaders believed their companies were ahead of the curve when it comes to optimising for ecommerce.

This is understandable given increased competition and complexity. “Many who are new to social media advertising or who are used to paid search campaigns underestimate how much time is required to create successful ads,” writes Michelle Goodall in Econsultancy’s Social Media Advertising Best Practice Guide. Campaigns can contain many different variations of copy, images or video that need to be designed around the device and platform.

More sophisticated still, are brands that use their ads and consumer interactions to drive campaigns by ‘self-optimising’. Take for example Glossier, screencapped above. In a recent campaign it had more than 30 different ad creatives targeting UK audiences, delivering multiple versions of each creative based on factors such as an individual’s location and age.

What should brands do now to capitalise on the opportunity?

Clearly given the importance of social commerce and marketplaces to the overall journey, and the role played by content, it will be a priority for marketers to address these content challenges. The highly competitive nature of both means that brands need to get up to speed on content quickly, and it’ll be imperative to grow internal talent and seek third-party support to fully evolve.

To help executives, Econsultancy in partnership with ChannelAdvisor have published a whitepaper “Social Commerce and Marketplaces: How To Build a Social Commerce and Marketplace Strategy to Drive Recovery and Growth Post-Covid”, packed with real-world case studies and data to inform the business case for investment, and a five-step plan to direct strategies.

Readers will be able to fully appreciate the market opportunity, putting into context the way in which ecommerce has accelerated in the post-Covid world. In addition, it explains the potential platforms to target and unique benefits of each. Most importantly, the report highlights what convenience means to shoppers today and why it’s more than just a ‘Buy Now’ button.

Source – econsultancy.com