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Headquartered in Switzerland, CBC has been deeply rooted in the Asian market for more than 26 years.

Jan 17,2023

The Evolution of Social Commerce on Platforms like Facebook Instagram and Tiktok

The traditional internet traffic dividend continues to diminish and the initial pattern has been set in the internet consumer space; instead, with the rise of social platforms, global consumers will spend 3.8 trillion hours on their mobile phones in 2021, with 70% of that spent on social and photo and video apps, according to the State of the Mobile Market 2022 report. The report states that the increase in time spent on apps by users has a direct impact on consumer spending.

In addition, in the past two years, under the continued influence of the overseas epidemic, overseas users' needs for information, lifestyle and entertainment, work and study have all shifted to social media, which has also accelerated the trend of overseas consumption channels going online. The massive shift of consumers to spend on social media has gradually transformed social media into an important channel for e-commerce.

Another important reason for the gradual transformation of social media into e-commerce is the change in business models. In the future, the business model will gradually move towards a share purchase model, which means that the business model will only focus on two things: one is volume and the other is profit. In the past, business was about selling products, but in the future, business will be about sharing products, a digital business model where consumers share their experiences through social media platforms to generate sales and benefits.

What Is Social E-Commerce?


Traditional e-commerce is goods-centric, generally through the e-commerce shopping platform after the customer's needs are stimulated to search and filter the purchase, belonging to the typical "people looking for goods" model, while social e-commerce is people-centric, such as in the process of watching videos, live, chat and other social sharing recommended to consumers, belonging to the social e-commerce The "goods looking for people" model. 

In the 1.0 era of social commerce, merchants basically channeled their traffic to the e-commerce platform through social media marketing to achieve traffic conversion. However, with the improvement of online payment functions of social media platforms, more and more KOLs (net celebrities) are bringing goods through their personal homepages, and consumers are gradually getting used to buying directly on social media, social commerce is gradually moving towards the 2.0 era, and the boundary between social media marketing world and e-commerce will become increasingly blurred.

The History of Overseas Social E-Commerce


Throughout the decade, social media has been more of a Facebook acquisition history. Until Tik Tok was introduced in 2018 and quickly fire out of the ring, which clearly appeared to be a blow to Facebook's user base. Facebook launched the short-video app Instagram Reels in more than 50 countries around the world shortly after the failed launch of the cottage Tik Tok, but always Facebook was lukewarm in the short-video segment.

It wasn't until 19 years ago that overseas social media started to look to China and the US and other countries started to copy China, from instant social software, short videos, social e-commerce (Jitterbug Small Shop - Tik Tok Shop - Facebook Shop - Instagram Shop...), to live streaming apps and more.

TikTok announced in September, 2022, that the platform had surpassed 1 billion monthly hits. As a new social platform, its social e-commerce has come from behind and has huge potential for future development, which is the focus of brand marketing. It has become the world's most profitable app this past 2022. According to app analytics firm Data-AI consumers worldwide spent more than $840 million on TikTok in the first quarter of 2022, up 40% from the fourth quarter of 2021. Of this, the US was one of the main drivers of growth, with consumer spending up 125% in Q1 2022.

While TikTok is gaining momentum globally and is a favorite among local internet users in Europe and the US, it still has a big rival in Instagram, which has seen the most download numbers since 2014, according to its Q4 2021 app performance tracking report. In Asia, Instagram is a favorite among Indian netizens, especially after TikTok was banned and Instagram Reels took over as the "number one" short video app in India.

On 27 April 2022, parent company Meta announced its results for the first quarter of 2022: Facebook remains one of the world's largest social applications with 2.936 billion monthly active users and almost 2 billion daily active users in March. However, with TikTok's competition for users and the announcement of its withdrawal from the Russian market, the growth rate of Facebook's active users has been significantly affected. So, we can simulate that by 2023, the proportion of TikTok users who are purchases will be comparable to that of Facebook users.

Future Trends in Overseas Social E-Commerce


One-Stop Shop:

Allow and encourage more businesses to open virtual storefronts on different social platforms, such as Facebook Shop, Instagram Shop and Tik Tok Shop. Consumers do not care where and how they shopping.

According to a sprout social survey of more than 1,000 consumers' social e-commerce behavior, the key trends include:

  ● In 2021, 68% of consumers will have made a purchase on social media, and this percentage will continue to increase.

  ● Consumers are turning to big social platforms like Facebook Stores, Instagram shopping and TikTok shopping.

Brand Differentiation:

Social media is more focused on the creation of personal IPs and personalized brand personas that can be more easily remembered by consumers. The classification of products is still a relatively large classification in social commerce. Making it easier for consumers to remember the brand requires the creation of a different brand identity that differentiates it from mass brands.

Create An Easy Shopping Experience:

The one-stop shopping of social e-commerce shortens the selection time for consumers, who can communicate with those online at any time before placing an order, discuss and buy the products they most desire.

Seamless Shopping:

Of course, with a one-stop shop, there is also the need to ensure that consumers have a seamless shopping experience during the platform shopping process, such as how to use the payment method and so on. One-click purchase is the best design to prevent the consumer from changing their mind, shorten the purchase process, and drive the purchase.

China's WeChat model is the most important reference model that overseas social media platforms and brands seek when building social e-commerce strategies. At present, Facebook, Instagram, Tik Tok and other platforms all adopt this method, that is, users can use social e-commerce at the same time of social platforms, and complete purchases can be made on one platform without jumping to other platforms or pages, which also reduces the loss of jumps to the greatest extent.

Digital Marketing and Social Media:

Social media marketing can be described as a marketing strategy used to promote products and build influential relationships with customers across different social media platforms. Social media is a platform, known as a simple place for users to share information, videos and other content. Social media marketing vs digital marketing, social media marketing conveys richer content, is more attractive to consumers, and is easier to establish an influential relationship with consumers.

Final Thoughts:

The moment has come for firms to shift their focus away from traditional retail marketing and fully embrace social shopping. This is necessary, or else you run the danger of missing out on the newest and most influential customer generation.

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