Purchases on social media platforms expected to reach $ 1.2 trillion globally by 2025, new study from Accenture finds
NEW YORK–(COMMERCIAL THREAD) – A new study from Accenture (NYSE: ACN) has found that the $ 492 billion global social commerce industry is expected to grow three times faster than traditional e-commerce to reach $ 1.2 trillion in by 2025. Growth is expected to be primarily driven by Gen Z and Millennial social media users, accounting for 62% of global social commerce spending by 2025.
According to the Accenture report, “Why shopping is ready for a social revolution“, social commerce means that a person’s entire shopping experience – from product discovery to the checkout process – takes place on a social media platform. Just under two-thirds (64%) of social media users surveyed said they made a social commerce purchase in the past year, which Accenture says reflects nearly 2 billion social shoppers globally.
“The pandemic has shown how people are using social platforms as an entry point for everything they do online – news, entertainment and communication,” said Robin Murdoch, global head of the software industry and platforms at Accenture. “The constant increase in the time spent on social media reflects how essential these platforms are in our daily lives. They are reshaping the way people buy and sell, which offers platforms and brands new opportunities for user experiences and revenue streams.
While the opportunity is great for large companies, individuals and small brands should also benefit. More than half (59%) of social shoppers surveyed said they were more likely to support small and medium businesses through social commerce than when shopping through e-commerce websites. Additionally, 63% said they were more likely to buy from the same seller again, showing the benefits of social commerce in building loyalty and encouraging repeat purchases.
“Social commerce is a leveling force that is driven by people’s creativity, ingenuity and power. This empowers small brands and consumers, and allows big brands to reassess their relevance to a market of millions of consumers, ”said Oliver Wright, global head of consumer goods and services at Accenture. “For social commerce to be successful, creators, resellers and brands will need to bring their products and services to where the consumer is and will be, rather than the other way around. It means working together within a dynamic ecosystem of platforms, markets, social media and influencers to share data, ideas and capabilities to deliver the right incentives and the best customer experience in a digital marketplace. integrated.
However, half of the social media users surveyed indicate that they are concerned that social commerce purchases may not be protected or reimbursed properly, making trust the biggest barrier to adoption, as was the case with the early stage electronic commerce.
“Those who have not yet used social commerce say that one of the reasons they are being held up is their lack of confidence in the authenticity of social sellers, while active social commerce users point to poor social commerce policies. return, refund and exchange as one area for improvement, ”says Wright. “Trust is an issue that will take time to overcome, but sellers who focus on these areas will be in a better position to increase their market share. ”
Who buys what
The Accenture report found that by 2025, the highest number of social commerce purchases globally is expected in clothing (18% of all social commerce by 2025), consumer electronics (13%) and interior decoration (7%). Fresh foods and snacks are also a large product category (13%), although sales are almost exclusive to China. Beauty and Personal Care, while smaller in terms of total social commerce sales, is expected to quickly gain traction in e-commerce and capture over 40% of digital spend on average for this category in key markets here. 2025.
Among the other findings of the study:
- Consumers in developing countries are more likely to use social commerce and often do. Eight in ten social media users in China use social commerce to make purchases for a given category, while the majority of social media users in the UK and US have yet to make a purchase through social commerce.
- Buyers in China, India and Brazil care more about features that help them discover and assess potential purchases while those in the United Kingdom and the United States place more importance on prices and discounts.
- Confidence is more important for older generations than for younger generations. Older buyers emphasize security features and value familiarity with the brand, while younger generations are drawn to live broadcasts and trust buyer reviews more.
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Accenture Research has conducted a series of studies on social commerce to better understand the nature of this opportunity. We designed and conducted an online survey of 10,053 social media users in China, India, Brazil, US and UK. The online study was conducted from August 12 to September 3.e, 2021. We also conducted in-depth interviews with buyers and sellers in these same five markets between May 26 and June 2sd, 2021.
Accenture’s social commerce market forecast was produced using econometric modeling, taking into account the optimization of consumer preferences to accelerate existing market dynamics. The social commerce market includes products or services ordered through social media, regardless of payment or fulfillment method, covering business-to-consumer (B2C) and consumer-to-consumer (C2C) transactions.
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