Discover Global Network Points to Social Commerce as Example of Shopping’s Digital Transformation

The lines between social interaction and commerce are increasingly blurred, and they show no signs of separating, at least not anytime soon.

“Social commerce takes the entire shopping experience, from finding a product, researching it and paying for it, onto a social media platform,” Discover® Global Network Global Head of Digital Acceptance Ellie Smith told PYMNTS.

This phenomenon, which represents the seamless integration of social media and eCommerce, is reshaping the retail landscape, offering new opportunities for consumers, merchants, tech providers and payment networks by transforming traditional online shopping into an engaging and interactive experience.

“For consumers, social commerce is a fundamental shift from a one-dimensional experience to an interactive event,” Smith explained.

Consumers can engage with brands, ask questions and interact with influencers who demonstrate and endorse products, making the shopping experience more personalized and engaging.

For merchants, social commerce opens a new channel to reach and sell to consumers, enhancing their digital footprint. Smith underscored that as social media grows, this channel becomes increasingly crucial to capturing market share, especially among younger generations who spend much of their time on various social platforms.

“It is a way for merchants to stay relevant,” she said.

As a key component in the digital commerce ecosystem, tech providers, payment enablers and credit card networks also increasingly view social commerce as a transformative opportunity.

These players must adapt to facilitate seamless transactions within social media environments, whether it’s collaborating with external payment solutions or developing new capabilities. This ensures a positive and secure shopping experience.

“We want to make sure that regardless of how our consumer wants to buy products and how our merchant wants to sell them, it’s a positive shopping experience,” Smith said.

The Rise and Impact of Social Commerce

The rise of social commerce is closely tied to the broader digital transformation of retail. As online shopping becomes more prevalent and social media use continues to climb, the convergence of these trends has naturally led to the growth of social commerce.

“For consumers and merchants, social commerce is a totally different way to engage in buying and selling,” said Smith.

She highlighted the evolution from early storefronts on platforms like Facebook and Instagram to today’s sophisticated livestream shopping events and artificial intelligence-driven shopping experiences.

“We’ve seen companies get a lot better at social commerce over the last couple of years,” Smith explained.

The focus has shifted to personalized content and targeted advertising, making social commerce more effective and appealing to consumers.

Still, despite its growth, social commerce faces challenges, particularly regarding consumer trust. Many shoppers are still wary of buying through social media platforms due to concerns about security and transparency. As one example, Smith recalled her own experience of abandoning a purchase on Instagram due to discomfort with the process.

“It’s a struggle to make sure you have the right environment to get consumers comfortable enough to actually make the sale,” she said.

Establishing a baseline level of trust and credibility with consumers is crucial for the continued success of social commerce. This involves ensuring secure checkout processes and using technologies like tokenization and digital wallets to protect transaction data. Smith explained that regional differences also play a role, with areas like Asia-Pacific leading in social commerce adoption due to earlier and more natural integration of mobile internet usage.

The Role of Social Media Platforms and Tech Companies

As expected, social media platforms and technology companies are at the forefront of driving social commerce implementation.

Major players like Meta and TikTok have integrated social and affiliate links, allowing merchants to drive consumers to their websites or third-party marketplaces, and Smith explained that advanced integrations enable platforms like Facebook Shops to connect directly with eCommerce stores, streamlining the shopping process for users.

“Every social media platform in one way or another is looking at driving social commerce,” Smith said.

These integrations allow social media to serve as powerful storefronts for merchants, enhancing the overall shopping experience for consumers.

Looking ahead, social commerce is poised to continue its upward trajectory, driven by the growth of social media and the increasing digitalization of shopping experiences. As consumers spend more time on social media, it stands to reason that social commerce will expand accordingly.

Key areas of future development include advancing the integration between social commerce platforms and eCommerce providers through enhancing security and trust measures. Collaborating with wallet providers or similar payment solutions can ensure that transactions are processed securely.

An additional key includes using the growing influence of social media personalities and influencers.

“The role of the influencer continues to grow and will be interesting to see how much that evolves over time,” Smith observed.

While social commerce is unlikely to completely replace traditional physical stores or standalone eCommerce websites, it will undoubtedly remain a growing part of the retail ecosystem.

As Smith concluded, “There is definitely a place for social media and a place for social commerce in the future, and certainly, I don’t think there’s much place for it to go but to continue to grow.”

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