Social commerce is one of those subjects that periodically grabs marketers’ interest, but has yet to take off in a major way.
Even the definition is becoming increasingly fluid. Where once it referred to direct sales, particularly "buy buttons" for users to click through and purchase an item immediately, it has expanded to encompass influence, days or weeks of consideration, and multiple purchase channels—even in-store.
A millennial-focused Cowen and Company survey, conducted in December 2017, shed light on the current state of social commerce. All social platforms have influence on purchase behavior, and—no surprise—more so among younger users.
Social platforms are also discovery vehicles.
Some 38% of millennials discovered a brand on Facebook that they ended up buying, closely followed by Instagram (37%). Both figures were higher than the overall average of 30% for Facebook and 29% for Instagram.
Meanwhile, Pinterest had higher rates of organic posts leading to purchase, Facebook caught users’ attention with paid ads, and Instagram had similar levels of shoppers triggered by organic posts and ads.
Perhaps the most interesting discovery, though, was where social media users actually bought products they saw on these platforms. Amazon was No. 1 (42%) for brands seen on Facebook. In fact, Amazon took the top spot for all social sites/apps included in the survey except Instagram.
"Shop Now" buttons generally take shoppers to the brand site within an Instagram framework, so it makes sense that 40% of respondents cited them. Very few of those polled purchased directly on social platforms, likely because many don’t facilitate such transactions. Even Pinterest, a site that has made efforts to encourage shopping within it, only captured 18% of purchases.
The proportion of purchases that occurred in physical stores hovered between 14% and 17% across all five platforms, which is a good reminder that the path to purchase often involves multiple channels.
One question beyond buying habits is where the coveted millennial demographic is spending time on social activities. eMarketer recently estimated that Facebook will lose 2 million users ages 24 and younger this year, and a January 2018 survey from Moosylvania found Facebook usage dropped between 2017 and 2018 among millennials at both ends of the spectrum—from 52% to 40% for those ages 17 to 27, and 48% to 33% for users ages 28 to 38.
However, according to both eMarketer and Moosylvania, Instagram is still attracting younger users. eMarketer predicts Instagram will add 1.6 million users ages 24 and younger in 2018, and Moosylvania found Instagram usage held steady for that younger segment (33%) and grew to 24% among older millennials.