4 Tips to Consider Before Selling on Social Media
Social commerce is an e-commerce term for buying and selling via social media networks. It includes everything from learning about a product, direct messaging sellers, and purchasing the item using a social app.
With the COVID-19 pandemic forcing brick-and-mortar stores to close their doors, including many small businesses, social commerce can be a tool for them to make up for lost sales during lockdown. And many younger consumers — including millennials and Generation Z — are leading the way with adoption of social commerce as an alternative to shopping in-store. As popularity for social commerce continues to grow globally, it's important to understand the nuances for selling in this emerging channel, as well as the potential challenges to selling globally.
Here are four key considerations for merchants looking to adopt social commerce into their e-commerce strategy:
Communicate Delivery Expectations
Since many merchants use social commerce, but don't actually carry inventory, they must contract with drop-shippers to sell all over the world. However, if they fail to let their customers know that there may be a delay in receiving the goods, this could be detrimental to the customer experience. Since many small businesses don't have access to logistics operations like Amazon.com or Walmart, they need to be very transparent as to the expected timeframe for receiving the goods. Not communicating on delivery dates can lead to chargebacks and refunds, which can put merchant accounts in jeopardy.
If you choose to sell globally, it's important to localize the checkout experience for each country you operate in and allow customers to pay for products in their native currency. To do this, small businesses will need a gateway that supports multiple currencies. Ultimately, localization leads to higher conversions and a frictionless checkout experience for customers.
Protect Customer Privacy
A 2018 survey found that security and privacy concerns are preventing social commerce adoption, with 71 percent of respondents saying they're concerned about security, and 65 percent citing privacy as an inhibitor. Merchants can ensure their customers’ data is safe by maintaining Payment Card Industry (PCI) compliance, which refers to the technical and operational standards that businesses must follow to secure and protect credit card data provided by cardholders and transmitted through card processing transactions.
Ask for Reviews and Ratings
Recent data found that positive reviews led to higher social e-commerce conversion rates on Facebook, Twitter, and LinkedIn. The power of customer reviews and ratings is real, and it’s important for merchants to ask their customers for these. If you don’t ask for positive reviews, you will only get negative reviews from unhappy customers. E-commerce brands should also monitor reviews and respond to both good and bad comments to reinforce positive feedback and resolve any issues.
According to research from TechNavio, social commerce sales in the U.S. were expected to grow by $7.3 billion in 2020 — 33 percent year-over-year — and continue growing at a similar rate through 2024. As e-commerce merchants increasingly offer more shoppable content that allows their customers to check out directly in the app (vs. solely browse for product inspiration, then move to the website), the above considerations will be extremely important in gaining customer trust and eventually converting that trust into sales.
Donald Kasdon is the founder of T1 Payments, a premier international card payment processor.