TREND 2 Buying: The rise of social commerce
Singles day in China
Three weeks before Singles’ Day 2021 – China’s biggest shopping event – one man sold $1.7bn worth of products. He isn’t the CEO of a brand. He is Austin Li Jiaqi – also known as the Lipstick King. He’s part of an e-commerce phenomenon – one that merges technology, shopping and celebrity.
In many ways, China is streets ahead of the rest of the world when it comes to innovative ecommerce; 45% of all of its purchases were made online in 2020. Li Jiaqi is a driving force in this culture of online shopping; he spends hours showcasing beauty products (hence the Lipstick King moniker) and selling to his millions of followers in real-time.
The closest the western world comes to this are influencer-hosted Instagram lives, or TV shopping channels. Neither format has distilled the boundary between entertainment and shopping quite like China’s livestreamers. We have to look at the entire user journey to understand why.
In China, social media platforms are better optimized for livestreams. Doyun – the Chinese version of TikTok – allows users to make purchases within as little as three taps. Social platform WeChat has multiple sub-apps just for shopping, and mobile payments are highly popular – shopping giant AliBaba has its own mobile payment service, AliPay.
In the realm of social commerce, China is decades ahead – but with Gen Z fuelling purchases the world over, western territories are set to follow, as predicted by marketing coach Danny Denhard: “We will move into ‘live’ shoppable video; shoppable feeds and live buy-a-longs. This will appear across all of the major platforms. Influencers will inject personality into this format, as they take the role of presenters encouraging the audience to shop along.”
We will move into ‘live’ shoppable video; shoppable feeds and live buy-a-longs. This will appear across all of the major platforms. Influencers will inject personality into this format, as they take the role of presenters encouraging the audience to shop along.
Danny Denhard, Marketing Coach
China has dedicated livestream platforms…
China has dedicated livestream platforms that have gone mainstream. The UK and US have Instagram – and more recently TikTok. 60% of US Gen Zs have bought something they’ve seen on Instagram, and 55% say the same for TikTok. At present, neither platform has the capacity to host a 12-hour shopathon. But that hasn’t stopped 18% of US Gen Zs and 14% of UK Gen Zs from watching a livestream shopping event.
TikTok and Instagram are two platforms that Gen Z…
TikTok and Instagram are two platforms that Gen Z are most native to – so it’s not surprising that they are closely entwined with their shopping habits. Perhaps more surprising? One in four Gen Zs have purchased something from Facebook Marketplace.
Facebook was quick to pioneer regulated peer-to-peer sales …
Facebook was quick to pioneer regulated peer-to-peer sales via its platform back in 2015. Two years later, it rolled out the Instagram Shops function. Both, it seems, have been championed by Gen Z ever since.
Arguably, both decisions were made off the back of demand from existing communities on those two platforms – before the infrastructure existed, Facebook had buy-sell-swap groups and local communities, while Instagram had influencers entering brand partnerships with fashion brands.
As shopping and social media become ever more entwined..
As shopping and social media become ever more entwined, the demand for more structure around social selling will continue to grow. TikTok is a prime example: from CleanTok (for those obsessed with cleaning) to FitCheck (a trend where people show off their outfit of the day), target audiences are already self-organizing into groups online – all they need now is a “buy” button.
Jonno Brech, CEO of Audiens
COVID-19 created havoc on the high street. But instead of shutting shop, small brands and local artisans pivoted to operate online-only stores. Artisans and entrepreneurs who previously counted a single neighbourhood as their market suddenly went global. In 2020, the number of UK Shopify merchants doubled, creating $22bn in economic activity and 112,780 jobs (that’s more than people living in the US Virgin Islands!).
But more interestingly, these artisans brought with them authentic brands with ethical credentials, which are a must-have for Gen Z consumers.
2022 will continue to see the “rise of the online artisans” and they will pull in increasingly more of Gen Z’s ecommerce spend. The big brands’ lack of personality and ethical credentials will show a stark contrast versus the artisans’ sense of purpose and warmth towards their customers.