The second decade of the third millennium has made it hard to recall what the world looked like before the advent of social media and the associated eCommerce. Since the mid-2000s, social media platforms have exploded and literally changed the way the world lives, works, learns, and plays.
By early 2021, there were already 4.2 billion active social media users, each spending over 2 hours daily on average on social networks and messaging. Clearly, the long-tail impact of social media is playing out and will continue to do so in the foreseeable future.
Over the past decade and a half, social media has evolved from its original premise, i.e., a way for individuals to socialize, have personal conversations, and engage in personal or professional networking to playing a critical role in the “purchase economy.”
The sheer volume, velocity, and diversity of transactions on social media platforms show that we are on the brink of a new era of eCommerce driven by social media.
The impact of social media On consumer buying decisions
As per recent analysis, 54% of people use social media to research products. Social media also makes it more likely that 49% of users will try a new or previously unknown brand. And perhaps most importantly, social media referrals influence 71% of consumer buying decisions.
How does social media influence these decisions? Here are the three key ways:
Peer recommendations and social proof
Social proof has perpetually played a role in human decision-making. People often ask their friends and family for recommendations on which product to buy, which features to focus on, and which brand to trust (or not). But now, consumers can ask for the opinions of their social media “family” on a much broader scale.
The recommendations and criticisms of social media users can instantly be seen and heard by – and influence – thousands of other users. According to Forbes, a whopping 81% of consumers’ purchasing decisions are influenced by their friends’ posts on social media. People trust the opinions of their friends and even strangers on social media, which influences how they research, compare, and buy products online.
The influence of influencers
Andrew Arnold, on Forbes, writes that just “5% of the social media influencers offering product recommendations [drive] 45% of social influence” for certain consumer product categories. Likewise, another report reveals that almost 40% of Twitter users make purchases as a direct result of an influencer’s Tweet.
Like friends and personal connections, influencers have earned the trust of their followers. The greater the trust and the more compelling their message, the more power they have to persuade buyers to make a purchase. Millennials, in particular, are most likely to be influenced – 84%, according to Gartner – based on social media content.
Buyer journeys are shorter and driven by eCommerce
Pre-social media, buyer journeys were longer but less complex. For instance, before purchasing a refrigerator or handbag, almost all would-be-buyers learned about the product from TV, radio, a newspaper, or a magazine. Occasionally, they would ask a friend for advice or seek recommendations through old-school means like face-to-face or telephone conversations. After considering the information at hand, comparing their (limited) choices, and finalizing their budget, they finally purchased the product. Depending on the product type and cost, this buyer journey took days, weeks, or even months.
In this day and age, this journey takes just a few hours or minutes. Through social media, a consumer can look for product information, check other users’ ratings, ask about customer experiences, and review recommendations. Then they can go to the product’s eCommerce store and order it in just a few clicks. Research is effortless and the shopping experience even more so. No wonder buyers influenced by social media are 4X more likely to spend more.
COVID-19 and the unprecedented eCommerce catalysis
Starting in March 2020, when so many brick-and-mortar businesses closed, buyers turned to eCommerce and social media for purchasing.
More than a year later, consumers are now more likely to be influenced by brand advertising, user-generated content (UGC), and influencer posts – on social media. No wonder 79% of users say that they’re now more inclined towards shopping on social platforms than they were a year ago. That goes to explain why brands have increased their social media marketing spending by 74% in a matter of a few months.
These pandemic-inspired shifts are not limited to B2C companies. B2B companies, too, are increasingly looking to leverage the purchasing influence of social media. In 2020, 91% of B2B organizations used social media platforms in their marketing mix, including TikTok, Instagram, Facebook, Twitter, and unsurprisingly, LinkedIn.
The Need for Growth Marketing in a Social Media Purchase Economy
The way people approach the purchase experience has changed due to social media. Today, buyers (both B2B and B2C) leverage these platforms to research products, engage in product discussions with others, and accordingly/subsequently make their purchases. For all these reasons, social media is, unsurprisingly, a crucial component of the marketing mix.
But in an already crowded, super-noisy social media landscape, it’s getting more difficult for brands to stand out and capture the attention of their audience. Further, many struggles to create unique content and deliver online experiences that encourage audiences to connect with (and stay connected with) the brand.
To address these challenges, businesses must invest in social media growth marketing. An experienced growth marketing agency like Ignitiv can help leverage the true power of social media to craft integrated digital experiences, influence more customers, and move them down the purchase funnel. To know how Ignitiv’s unique growth marketing strategic framework can supercharge your business’ social media presence, click here.