People no longer use social media just to stay connected with brands. It is now also a way to engage with brands, learn, and shop. Buying goods through social media platforms, also known as social commerce, has gained popularity with the increasing number of social media networks. Now, audiences can make purchases through platforms such as TikTok, Facebook, and Instagram. Its rapid rise in popularity has shaped how consumers find products, interact with brands, and purchase online.
Numerous factors are behind the growth of social commerce, from Gen Z's purchasing power to social media platforms' repositioning as marketplaces where consumers don’t need to leave the app to complete a transaction. Let’s explore social commerce as a payment trend. As a popular shopping method, the convergence of ecommerce and social media has met the millennial, Gen Z, and Gen Alpha consumers where they like to spend their spare time: social media.
The growth of social commerce is driven by several key factors that cater to modern consumers' evolving needs and preferences. Convenience is at the forefront, allowing users to read reviews, watch live demonstrations, ask questions, and complete purchases all within the same app. This streamlined process eliminates the friction of switching between multiple platforms, making shopping more efficient and enjoyable. Consumers can then pay for products from their chosen brands without leaving the platform. In-app payments will take social commerce to the next level as we move away from the broken checkout experiences of shoppers being redirected to the merchant's website to complete a purchase. Instead, with in-app purchases, brands can offer direct payments, keeping the checkout process simple, quick, and effective whilst keeping shoppers in their ecosystem. A Deloitte study shows that in-app payments could account for one-half of overall social commerce payments by 2030, making it a dominant shop-and-pay model.
Moreover, social commerce offers a more personalised experience. Algorithms analyse user behaviour to recommend relevant products, while consumers can interact directly with brands, boosting engagement and satisfaction. Personalisation to this scale is less available in traditional ecommerce, where interactions are often limited and less tailored.
Trust is another critical element propelling social commerce. User-generated content, the influencer culture, and a strong sense of community contribute to the credibility of products and brands. Consumers feel more confident purchasing items endorsed by people they follow and trust. This communal aspect is especially appealing to younger audiences. Notably, 43% of Gen Z audiences start their product search on TikTok, surpassing traditional search engines like Google and ecommerce giants like Amazon. This statistic highlights the shifting landscape of product discovery and the growing influence of social platforms in shaping consumer behaviour.
Global social commerce is expected to reach GBP 6.7 trillion by 2030, and nearly 6 billion people will use social media by 2027. Based on this, we can expect social media to gain more power to complete a purchasing journey, with influencer marketing taking the lead in influencing consumers. We’ve seen how modern-day consumers find comfort in social proof – from reviews and live videos to social media posts from influencers; the power of recommendation is growing. The reason for this comes from the vast available choices and customers’ need to trust the brand they choose to purchase from.
Shoppers' need for quick, seamless, and convenient shopping experiences will remain important, and accessibility through social platforms will gratify these needs. Social commerce sales are expected to nearly double comparing to 2023, exceeding 1 trillion by 2028 globally. The future of social commerce is lucrative, with improvements of additional technologies, such as AI customer support, to accelerate the speed of responding to customers and offer real-time support 24/7.
Currently, in 2024, there are more than 5.07 billion social media users worldwide, equivalent to 62.6% of the total population. Data Reportal showed that since 2023, there have already been 259 million new users on social media platforms, an average rate of 8.2 new users every second. The growth of social commerce and the growing number of social media users place social commerce as a disruptive force to traditional ecommerce. And so, businesses looking to elevate and engage with growing generations must work to navigate the rapidly evolving landscape.
Fintech products have opened financial services for businesses to engage with audiences internationally through multiple channels. To tap into the potential of social commerce, businesses must integrate their e-shops with the right payment methods. What does this look like? Well, it means offering payment solutions that cater to local preferences and facilitate frictionless cross-border transactions. Consumers need not only to see their preferred local payment methods and currency but also a way of payment that suits their financial preferences, such as instalments or subscription payments.
Payment institutions – including card issuers, networks, merchant acquirers, and payment facilitators – play a pivotal role in shaping the future of social commerce payments. By improving in-app payment capabilities on social platforms, they can offer secure and convenient customer experiences essential for social commerce success. And ultimately quickly launch businesses into the thriving world of social commerce. Given that most social media engagement occurs on smartphones, a seamless checkout and payment process is a baseline expectation. The support of digital wallets and features like one-click payments can make in-app social commerce transactions frictionless and nearly invisible, increasing online consumer spending. Consumers expect the option to pay with both traditional and alternative methods, including digital wallets, Buy Now, Pay Later financing, and even digital currencies. To meet these expectations, social platforms are increasingly partnering with payment facilitators to integrate a wide array of payment options, ensuring comprehensive and flexible payment solutions.
On average, social media users actively engage on 6.7 different platforms each month, spending around 2 hours and 20 minutes per day. This high engagement level highlights businesses' immense potential to leverage social commerce. By optimising their payment systems to be seamless, secure, and versatile, businesses can not only meet but exceed customer expectations, thus boosting their brand and ensuring long-term success in the competitive landscape of social commerce.
Irene Skyrnova is the Chief Customer Officer at Unlimit. She is responsible for all client interactions and for building the company’s long-term customer strategy. Irene is an expert in customer experience, success, cryptocurrencies, and ecommerce. She boasts a breadth of international experience, holding roles that span public relations and marketing to customer care and business development.
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