Will Twitter's Social Commerce Initiative Work?
This morning Twitter introduced its Buy Now button, a feature that enables users to make purchases directly on the social network as well as its mobile app. Twitter is the latest social network to integrate commerce into its offering, with previous efforts seeing varying degrees of success.
Twitter is slowly rolling out commerce functionality, with only two retailers — Burberry and Home Depot — having inaugural access. The social network said all shipping and payment information is fully encrypted and will not be shared with the seller without customer permission. Considering the recent news surrounding Home Depot, I'm guessing secure transactions was a sticking point for the home improvement retailer.
The retail partners can tweet products as part of their regular tweets, in ads or via promoted tweets. Here are a couple of scenarios of how the service could work, according to a CNBC article: Home Depot can tweet about a hurricane warning with a buy now button for hurricane-related supplies (e.g., flashlights, plywood), while Burberry can tweet an offer to buy a limited-edition coat available at a discounted price for a limited period of time, like a flash-sales site. The service is expected to cater to impulse shoppers.
The million-dollar question remains, however: Will consumers fully embrace social commerce? According to a recent survey from marketing and technology agency Digitas LBi, they might be moving in that direction — which is a bit surprising to me. Five percent of Americans have made a purchase on a social media site, and 20 percent would consider doing so.
"Our study reveals tremendous untapped potential for growth in social commerce, especially among younger consumers," said Tony Weisman, CEO, Digitas LBi North America, in a company press release announcing the survey's findings. "The 5 percent of Americans who have made a purchase on a social media site equates to around $14 billion in online retail revenue. If we can reach 20 percent, that figure scales to $56 billion. To activate that potential, brands and social networks need to provide social shopping experiences that meet the needs of consumers, including security around financial data, privacy and a seamless buying process."
While I've always been of the mind-set that consumers spend time on social networks not to shop but to be entertained, catch up on the latest news, and look at photos of friends and family, maybe this is changing.
Do you believe Twitter's buy now button will work? Or do you think it will it be the latest in a fairly long line of social commerce failures? And what are your thoughts on social commerce in general, both as a consumer and a retailer? Let us know by posting a comment below. We'd love to hear from you!