There is no question that social media platforms have grown to become an important part of people’s lives. They can help people connect across great distances, and they are also extremely useful in sharing ideas, news and opinions. Moreover, social media platforms like Twitter, Facebook, LinkedIn, Instagram and TikTok have also evolved to become vital for various organizations around the world, because they can be used to promote businesses, products, and services. By using social media apps, companies worldwide can now reach wider audiences, boost brand awareness, and build better relationships with their customers.
While these features have proved to be extremely important in digital marketing, social media platforms have also transformed other industries around the world. e-Commerce is undoubtedly one of the fields currently undergoing important changes. According to Digi Venders, the ongoing growth of social media has given rise to social commerce, a combination of social media and e-Commerce that lets users buy products and services directly from social media platforms. However, social commerce is just one of the trends linked to social media development that are currently reshaping e-Commerce.
Social Commerce Is Likely to Grow
Social commerce has been an important part of e-Commerce in recent years, and yet it has only recently surged in popularity. While the international social commerce market was worth approximately $89.4 billion in 2020, analysts predict that its value will expand to reach $604.5 billion by 2027. With a remarkable compound annual growth rate (CAGR) of 31.4%, social commerce is undoubtedly one of the most important aspects of social media now reshaping e-Commerce. Furthermore, social commerce is likely to grow progressively as more and more Gen Z members become adults, considering the fact this cohort has had access to the internet and social media since childhood.
Social commerce comes with many benefits that are likely to change consumer behavior in the future. According to Digi Venders, social commerce is extremely convenient, it provides customers with a personalized shopping experience, and it also provides businesses with new ways of engaging with their customers. Furthermore, more and more social media platforms are now joining the trend and investing in social commerce features. Companies can now profit from new opportunities, like Instagram Checkout, Facebook Shops, and Pinterest’s Shop the Look, to sell directly to their consumers via social media.
TikTok Is Refocusing on Western Markets
According to the Financial Times, TikTok has restructured its social commerce business. The Chinese short-form video hosting platform plans to focus its e-Commerce efforts on Western markets, such as the US and the UK. While the social media platform has encountered challenges in exporting its livestream shopping model beyond its home country, the moves suggest it will continue to fight for its place in these markets. However, gaining interest from consumers and content creators in US and UK may prove to be problematic for the Chinese-owned company, especially considering the fact that the app is suspected of collecting an “excessive” amount of data.
Even so, TikTok Shop is emerging as a formidable competitor to established e-Commerce players, like Shopee and Lazada in Southeast Asia, according to CNBC. A similar development might soon be seen in Western markets, like the US and the UK. According to sources cited by the Financial Times, the initial goal of providing US sellers with unrestricted access to TikTok Shop, without requiring manual assistance from TikTok employees, was set for the beginning of this year. However, due to difficulties in attracting a sufficient number of small local businesses in the US, the timelines have been postponed until the summer of 2023.
Changing the Future of e-Commerce
The fact that TikTok is becoming a prominent rival to traditional e-Commerce companies and social media platforms might be concerning, considering the cyber-security threats associated with the use of the app. However, social media and e-Commerce are both highly competitive industries, and TikTok may need to up its game and address these concerns if it hopes to thrive in the Western markets. While its expansion remains hard to predict for the moment, it will undoubtedly leave a mark on the industry. Like TikTok, numerous other social media platforms are also launching or expanding their e-Commerce features, which indicates continuous growth in the coming years.
