People are spending more and more time on the internet, with much of it spent browsing social media platforms such as Facebook, Instagram, Twitter, and others.
Research from 2020 shows that internet users from around the world are spending an average of 145 minutes per day browsing their various social feeds.
With billions of eyes glued to smart phones, tablets and laptops, companies, like Facebook, have increasingly been finding ways to monetize traffic and sell products.
In the case of Facebook – which launched Facebook Marketplace back in 2016, allowing users to sell items amongst one another – the social media goliath took another step forward this past year by introducing a feature called Facebook Shops, a virtual marketplace for businesses to sell products directly off their platform.
Facebook Shops is also available on Instagram, which was purchased by Facebook for a cozy $1 billion back in 2012.
The new addition is the latest example of a growing sales and marketing strategy called social commerce, which utilizes social media to help users buy, and businesses sell, products online.
Businesses on Facebook Shops, for example, can create online stores on the platform, with users able to make purchases directly off the app.
“In today’s business environment, selling via social media holds a lot of appeal, as more people are spending time on social platforms such as Facebook and Instagram and more people are already accustomed to buying online,” wrote Yuval Ben-Itzhak, CEO of Socialbakers, in a published commentary. “Where social commerce differs from social media marketing is that instead of directing users to an online store, brands can offer users the ability to purchase products directly within the social network.”
Allowing users to make purchases without leaving the comfort of their social media platforms has already shown itself to be profitable. Social commerce sales in the U.S. came out to $38 billion during 2020 – a growth of 35% – and is expected to be at $50 billion annually by 2023.
Globally, the numbers are even more eye-popping. The market for social commerce during 2020 was estimated to be at $89.4 billion and is expected to grow to around $600 billion by 2027, a compound annual growth rate of about 31%.
“Brands who aren’t developing a social commerce strategy will eventually get left behind,” Ben-Itzhak wrote. “That’s not to say that brands need to stop investing in their website or other owned media today and focus everything on social. Instead they need to start working to find a way to marry their owned media with the reach, engagement and simple purchase process afforded by social media.”