Accenture’s new report shows that global social commerce, which includes shopping on social media platforms, will grow three times faster than traditional e-commerce. It is expected to increase from 492 billion to 1 trillion US dollars by 2025.
Social commerce accounts for 10 percent of all ecommerce spending today. This number will rise to 17 percent in the next three-years. Accenture says that this growth will be driven primarily in part by Gen Z and Millennial social-media users. They will account for 62 per cent of global social commerce spending by 2025.
Accenture’s report, “Why Shopping’s Set For a Social Revolution,” shows that 64% of 10,053 respondents in the UK, US and China surveyed had made a purchase through social commerce in the past year. The entire shopping experience, from product discovery through checkout, was done on social media platforms. Accenture estimates that this number represents nearly 2 billion social customers worldwide.
Accenture’s global software and platforms industry leader Robin Murdoch said in a statement that the pandemic demonstrated how many people use social media platforms to access all their online activities, including news, entertainment, and communication.
“The steady increase in social media use is a sign of how important these platforms are to our everyday lives. They are changing the way people buy and sell. This provides brands and platforms with new revenue streams and user experiences.”
Global social commerce to surpass 1.2 trillion US Dollars by 2025
According to the report, clothing will be the most popular social commerce category in 2025 (at least 18 percent of all social commerce sales by that date), followed closely by consumer electronics (13%), and home decor (7%) Although the beauty and personal care categories are smaller in terms of total sales, they are expected to rapidly gain ground on ecommerce and capture more that 40 percent of all digital spend in key markets by 2025.
Accenture says that social commerce is more popular in developing countries. Eighty percent of Chinese social media users use social commerce to purchase products in a particular category. However, the majority of US and UK social media users have not made a purchase through the channel.
According to the report, shoppers in China, India and Brazil value features that allow them to find and evaluate potential purchases. However, those in the UK or US are more concerned about pricing and discounts.
Accenture’s global lead for consumer goods and services, Oliver Wright, stated that social commerce is a levelling agent driven by creativity, ingenuity, and power of individuals. It empowers small brands and individuals, and forces big brands to reevaluate their relevance in a market of millions.
“To get social commerce right, creators, resellers, and brands will need to take their products and services to the consumers, not the other way round.” It involves working in a dynamic ecosystem that includes marketplaces, social media, influencers, and platforms to share data, insights, and capabilities to provide the best incentives and consumer experience possible across an integrated digital marketplace.
Accenture reports that half of the social media users polled are worried about social commerce purchases not being protected or refunded correctly.
According to the report, trust is more important for older shoppers than it is for younger shoppers. The report explains that older shoppers value brand familiarity and security features, while younger shoppers are more attracted to livestreams. They also trust buyer reviews.
Wright said that “people who are yet to use social commerce point out that they lack trust in social sellers. Active social commerce users point out poor policies regarding returns, refunds, and exchanges. Although trust is a difficult issue to resolve, sellers who are more focused on these areas will have a better chance of growing market share.”