How Social Commerce Is Fracturing Brand Loyalty.
As social commerce surpasses $30B in ad sales in the U.S., which is expected to double by 2025, it has paved the way for startup and up-and-coming brands to detour consumers by visually persuading them to swipe and click away from their go-to brands. In the past year alone, 65% of these shoppers opted to buy products directly or to discover products that were never being considered for purchase, leaving well-established brands in unfamiliar territory as to how, or even if, they can win back their once loyal customers.
According to this Q3 2021 report by Emplifi, global ad spend on Facebook and Instagram grew 43% year over year, with record amounts predicted in Q4. This correlates to how consumers spent an average of 65 minutes daily in 2020 and 2021 on social networks, compared to 54 minutes and 56 minutes in prior years—a trend that experts believe will continue for years to come.
Fueling the Social Commerce Surge
“With lower budgets and less resources available to them, brands can be quickly spun up and easily discovered or inserted into the purchase consideration, just by creating the right search or retargeting strategy on these social media platforms.”
As shared in this article, “The Internet Broke Brand Loyalty,” brands like Warby Parker and Dollar Shave Club demonstrated how the right message and advertising can attract and convert consumers from the larger players. With lower budgets and less resources available to them, brands can be quickly spun up and easily discovered or inserted into the purchase consideration, just by creating the right search or retargeting strategy on these social media platforms. For example, we can swipe our Instagram feed where practically every other image or sponsored post provides another opportunity to get our attention, discover, or shop.
Next-Gen Challenger Brands Are Chipping Away at Brand Loyalty
Recently, I did a search using the term “hoody.” When I clicked over to Instagram, I was met with five to eight brands that I had never heard of. Despite this, I was able to visit each site within the app, compare styles, colors, return policy and price. It was very convenient, and allowed me to explore my options in just a few minutes and make my purchase in under a minute.
“During the COVID-19 pandemic, more than 75% of U.S. consumers tried a new way of shopping, many of them for convenience and value.”
“At least 65% of consumers who tried a new behavior plan to stick with it post-crisis.”
This McKinsey whitepaper further supports how consumers are shifting away from their preferred brands or retailer. “When consumers couldn’t find their preferred product at their preferred retailer, they changed their shopping behavior; many consumers have tried a different brand or shopped at a different retailer during the crisis. Value, availability, and quality were the main drivers for consumers trying a different brand.” During the COVID-19 pandemic, more than 75% of U.S. consumers tried a new way of shopping, many of them for convenience and value. “At least 65% of consumers who tried a new behavior plan to stick with it post-crisis.”
B2B’s Growing Interest in Social Selling
“60% of U.S. B2B marketers now using Instagram, up from 30% in 2020.”
While many B2B brands rely heavily on cultivating in-person relationships with prospects, more and more are recognizing the need to round out their marketing mix through channels that have been previously ignored. When it comes to social, for years Linked has been the go-to channel for B2B marketers. What may be surprising to most readers is how social channels like Instagram are reconfiguring digital media buys. This study validates this trend, with “60% of U.S. B2B marketers now using Instagram, up from 30% in 2020.”
Furthermore, “this figure is up from just 30% reported midway through 2020, demonstrating the power social media advertising—particularly that which is image- and video-based—has had throughout the pandemic. As remote work and business continues, it is evident B2B brands are investing in Instagram and other platforms to connect with their employees and potential customers in new and creative ways.”
“72% of the B2B salespeople who use social media report that they outperformed their sales peers, and more than half of them indicated that they closed deals as a direct result of social media.”
By adopting a social selling strategy, B2B and sales can place less emphasis on their outbound marketing efforts on content that allows the prospect to learn and download educational content, or by having the sales team answer questions directly in order to navigate the prospect down the sales funnel with a clear purpose of intent. Harvard Business Review reported this: “Three out of four B2B buyers rely on social media to engage with peers about buying decisions. In a recent B2B buyers survey, 53% of the respondents reported that social media plays a role in assessing tools and technologies, and when making a final selection.”
In addition, more than three-quarters (82%) of the B2B buyers said that the winning vendor’s social content had a significant impact on their buying decision. A LinkedIn survey found that B2B buyers are five times more likely to engage with a sales rep who provides new insights about their business or industry. Another survey showed that 72% of the B2B salespeople who use social media report that they outperformed their sales peers, and more than half of them indicated that they closed deals as a direct result of social media.
The B2B and B2C Trickle-Down Effect
Whether it’s a combination of COVID-19 effects on our digital habits, or brands such as Netflix, Uber and Domino’s that have redefined the meaning of personalization and customer experience, it has resulted in a customer expectation trickle-down effect impacting every B2B, B2C brand and sector. In fact, 52% of companies that have both B2B and B2C customers say they have seen more similarities in the way these two groups of consumers behave.
To monetize this convergence, B2B and B2C need to continue to explore how they can test and optimize digital experiences that meet their customer at the exact point of decision and that provides an experience that delights, informs and converts.
Has your brand or organization embraced social to extend their reach and deflect any consideration away from a competitor? If not, we’d be happy to help. Email us here.
As always, thank you for reading.
Photo by Kelly Sikkema on Unsplash