The latest report published by Hamburg-based market intelligence firm yStats.com, “Global Social Commerce Market and Trends 2023” provides an in-depth review of the social commerce market and the emerging technology trends within the market. Some key findings of the report include forecasts of sales via social commerce, plus the most demanded social media platforms used for buying.
The social commerce market continues to evolve across regions, with Europe witnessing slower growth compared to other regions
The outbreak of the pandemic increased the reliance on social media globally not only for entertainment but also as a medium of decision-making for purchasing goods and services. As online shopping platforms were already in place post-pandemic, consumers worldwide had already welcomed the idea of shopping online. Thus, the rise of social media usage and adoption across regions led to a new concept of buying and selling. Social commerce is forecast to grow three times than overall E-Commerce by 2025, as revealed by the new yStats.com report. Double-digit CAGR from 2020 through 2025 is forecast, with sales value reaching trillions of euros by 2025. In terms of generation, millennials, followed by Gen Z will have the largest forecasted share of social commerce expenditures by 2025. Globally, almost two-thirds of social media users claimed to have purchased via social media as of September 2021, with Instagram being the favored social media site for purchase for more than half the survey respondents in January 2022. Apart from Instagram, consumers relied on Facebook, YouTube, and Tiktok to buy via social media, with beauty products and apparel being the most purchased categories as of January 2022, as spelled out by the new yStats.com report. Social commerce is rapidly picking pace even in the North American market. Rising at a constant Y-O-Y growth rate, retail social commerce sales in the U.S. are forecasted to reach a value in the billions of euros, while the number of social commerce buyers is also predicted to increase by 2025. Meanwhile, in Europe, the growth of social commerce is slower compared to other regions. For instance, after its launch in the UK, TikTok’s live shopping feature did not garner the expected number of brands and influencers. Moreover, social media platforms such as Facebook, Instagram and Pinterest also do not provide an integrated payment model to European consumers as provided in the American market.
Technology trends such as voice technology, AI, AR/VR, and machine learning are transforming the social commerce ecosystem
With the use of AI and machine learning, brands are able to create chatbots, which have encouraged direct buyer and seller interactions. Furthermore, Instagram, WhatsApp, and Facebook provide more enhanced and real-time chat functions, thereby leading to the growth of conversational commerce, as stated in the new yStats.com report. AR/VR technologies enable consumers to shop virtually with the help of their phone camera, this is especially utilized by home décor and beauty brands. Furthermore, Snapchat recently launched its AR-based shopping lenses, which allow users to not only try on various products but also directly access product information. Shopping links, swipe-up features, and the Shop Now Button are some other features of social commerce that are gathering momentum among consumers, as they make purchase processes easier.
