Consumers are becoming increasingly connected on social media, and retailers are taking notice.
In a bid to grow engagement and sales, merchants have taken to social media platforms to promote their wares. In turn, these platforms have made it increasingly easy for consumers to buy things they like instantly. For instance, TikTok launched TikTok Shop in the U.S. in September, narrowing the gap between retailers and consumers.
“Tracking the Digital Payments Takeover: Monetizing Social Media,” a study conducted by PYMNTS Intelligence and Amazon Web Services, examined consumer use of social media to review and purchase items. As part of this study, we surveyed a census-balanced panel of almost 3,000 U.S. consumers.
The study found that 43% of consumers use social media to find goods and services, but just 14% purchase those goods and services via social media.
What consumers actually buy is a different story.
Clothing and apparel, food and beverage, and beauty products are the top three categories of retail products that consumers plan to buy on social media in the next 12 months, according to PYMNTS Intelligence.
However, other categories are expected to record higher growth in social media shopping: pet products, toys and home furnishings. The social platform where consumers plan to shop varies depending on the product category: While consumers turn to TikTok for toys, YouTube is the kingdom for pets, and Instagram leads home furnishing purchases.
PYMNTS Intelligence data also found that 86% of consumers currently making purchases through social media affirm they are very satisfied making purchases this way. As a result, almost half of consumers are considering making a purchase on social media in the next 12 months.
The share grows with younger generations: three out of four Generation Z consumers and two out of three Millennials intend to make a purchase through social media. In addition, Gen Z consumers were the most likely to shop on social media because products are more attractive there, something that makes this generation distinct.
Pet product purchases through social media are expected to see a major growth, with a projected doubling of the current share of shoppers. The popularity of pet videos and dedicated profiles on Instagram or Pinterest, as well as the proliferation of pet shops and small brands on different digital channels, drives this trend.
Toy purchases via social media are also expected to grow by 85% in the coming year, PYMNTS Intelligence found. The toys category is fueled by the extended consumer trend to buy toys online out of season to get better prices and special discounts.
Some of the top toy manufacturers are moving in that direction to capture this opportunity. Mattel, for instance, has pushed Barbie as a flagship brand into a broader space of social media to further fuel sales. As a result of this and other marketing strategies, the company announced a 9% increase in its third-quarter 2023 net sales.
The digitalization of retail purchases on social media is occurring across all categories but at a different pace. While more established categories such as clothing or beauty keep expanding steadily, others are catching up by growing faster and creating opportunities to draw in more consumers.