Retail-Tech Landscape: Social Commerce

Social commerce refers to brands and retailers leveraging the power of social media to market and sell their products and services online—which has become ever more important following the pandemic-led acceleration in e-commerce. Social media has evolved from a channel that simply connects people to a destination for shopping. Coresight Research’s latest annual survey on social commerce, conducted in March 2021, revealed that 80.6% of US consumers use social media and 48.1% use social media as part of the shopping process (discovering, researching and browsing products, or making purchases). Furthermore, 44% of all respondents reported that they make purchases through social media. This Retail-Tech Landscape covers selected startups globally whose technology solutions support brands and retailers in operating social commerce models. We have identified 42 startups and companies across the following categories:

• Social networking platforms
• Reselling
• Group buying
• Video commerce and livestreaming
• Social payments integration

Social Commerce Trends in Retail Below, we highlight two key industry trends in social commerce. 1. Livestreaming Is on the Rise Video content is a popular way for brands and retailers to convey product information in a fun, engaging and memorable format—and livestreaming (live, shoppable videos) is now gaining traction, taking the place of pre-recorded promotional videos. Livestreams can be delivered through social media, marketplaces and owned media; they enable brands and retailers to better connect with consumers online in a more personalized way. Livestreaming originated in China and is witnessing a surge in adoption in the US: Coresight Research estimates that livestreaming e-commerce accounted for just 0.8% of total e-commerce revenue in the US in 2020, but that penetration will more than triple by 2023 (see Figure 1). In our 2021 social commerce survey, 31.5% of respondents reported that they had watched a shoppable livestream, presenting opportunity for brands and retailers to tap an underpenetrated market. Consumers that have watched shoppable livestreams recognize multiple benefits of the channel that brands and retailers can leverage to attract new customers, with our survey finding that reasons for watching include product and deal discovery, learning more about products, convenience, entertainment and excitement.

• Read more Coresight Research coverage of livestreaming e-commerce.

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Figure 1. US: Livestreaming E-Commerce Sector Size (USD Bil.; Left Axis) and Penetration (% of Total E-Commerce; Right Axis) [caption id="attachment_138037" align="aligncenter" width="700"] Source: Coresight Research[/caption]   2. Frictionless Social Media Shopping Will Become Critical, Powered by Social Payments Brands and retailers are increasingly looking to integrate more shoppable features into their social media channels to offer a frictionless shopping experience to consumers, who enjoy the convenience of completing transactions through a single platform: Our survey found that 30.1% of respondents who use social media for product discovery/research will “often/always” abandon a purchase due to a platform’s lack of built-in functionality. It is therefore crucial for brands and retailers to offer an end-to-end discovery-to-purchase solution to remove friction in the shopping journey and drive conversion.

Retail-Tech Landscape: Social Commerce—Infographic

Retail-Tech Landscape: Social Commerce, by Category

Social Networking Platforms: Social media, networking and e-commerce companies offering social commerce features for product discovery and purchase [wpdatatable id=1538] Reseller-Based Social Commerce: Companies that are helping retailers to sell their products to consumers through resellers, leveraging social media channels [wpdatatable id=1539] Group Buying: Companies using social media channels to help consumers avail discounts through group buying and deal sharing [wpdatatable id=1540] Video Commerce and Livestreaming: Companies providing shoppable videos and live videos for product discovery and purchase through social media channels [wpdatatable id=1541] Social Payments Integration: Companies offering peer-to-peer digital payments that integrate social functionality such as text, voice and video [wpdatatable id=1542]