Consumers Remain Skeptical Of Shopping on Social Media
A recent report by AiBuy reveals a distrust among social commerce but looks at potential growth through transparency and targeted strategies.
Social commerce, consumers browsing social media to find goods and services, has become the next frontier within the direct-to-consumer e-commerce space. According to McKinsey reports, social commerce's popularity within China has been documented for years but the U.S. continues to be a smaller yet rapidly growing market segment.
In 2021, $37 billion worth of goods and services were purchased through social commerce channels in the U.S. McKinsey predicts that it will reach nearly $80 billion by 2025 to account for 5 percent of all e-commerce and worldwide, social commerce will grow to more than $2 trillion by 2025.
A recent report by WWD forecasts that 2024 will be the year that social commerce truly takes over social media feeds. TikTok has 503 percent more fashion-focused searches versus Google and YouTube yields 12 million more searches than
Google for fashion-related terms.
To understand the current state of social commerce, AiBuy, an in-content shopping solution, released its “2023
Social Media Shopping” report looking at which areas U.S. consumers struggle to trust with the concept of social commerce and find opportunities for brands hoping to leverage the spaces. The survey was conducted by Censuswide and polled more than 1,000 U.S. adult social media users.
“While social media has been around for nearly two decades, the concept of shopping directly through social platforms is still very new, so it comes as no surprise we're seeing this reluctance to purchase,” said Randy Bapst, chief executive officer at AiBuy. “With 45 percent of social media users in the U.S. open to the concept, there is ample untapped opportunity for brands who are not already leveraging the space, and for those that are, to tailor their approach moving forward. We're hopeful that as new technologies emerge to strengthen the customer path to purchase and overall user experience, trust will increase and this concept of social shopping will become more mainstream.”
According to AiBuy's report found that 52 percent of Generation Z and Millennial social media users in the U.S. don't buy products sold on social media platforms. One explanation for this, the authors of the report said, is a lack of trust lies with the platforms — over a third of respondents
(38 percent) said that they trust TikTok the least when purchasing directly on its app.
Moreover, 63 percent of people polled reported that they are discouraged from social media purchases because “they're worried about illegitimate merchants and scams.” Fifty-seven percent said they're put off from sharing checkout information such as credit card numbers, addresses, phone numbers and more to social media merchants.
Some other concerns from American consumers include counterfeit or lowquality products, lack of privacy and data security safeguards, unclear refund and return policies, lack of customer reviews and ratings and lack of regulations with made-at-home products.
The report's authors note that transparency market strategies are the key to success, as 36 percent of consumers said they felt personally deceived by social media ads.
Nearly three in 10 people agree that social media shopping has a more personalized experience than traditional online stores. Twenty-four percent of shoppers said they are more likely to impulse buy from these platforms as well.
Regarding brands working with content creators or maximizing content creator affiliate programs, the top motivations behind social commerce user purchases include exclusive discounts offered by a creator or a social media platform, targeted ads based on consumer interests and finding the cheapest available option.