The Social Commerce Trust Problem: What Retailers Should Know

The Social Commerce Trust Problem: What Retailers Should Know

The Social Commerce Trust Problem: What Retailers Should Know

We addressed the skyrocketing use of social commerce in a recent post because it’s an important retail trend. Social platforms present a seemingly perfect retail landscape.

By offering a combination of visual, audio, and text elements, social feeds meet users where they already are, providing product discoverability that’s relevant without being intrusive.

But while consumers continue to embrace social commerce (global sales on social platforms are expected to reach $1.2 trillion by 2025), consumer adoption of social commerce faces a big problem—trust.

In this post we clarify the social trust problem—what it is, why it’s happening, and what can be done about it. But first, it’s important to understand what social commerce is (and what it isn’t).

What social commerce is (and what it isn’t)

When a sale—from product discovery to final purchase—occurs entirely within the gated walls of a platform like Facebook or Instagram, it’s considered social commerce.

Social media contributes to retail sales outside of the social platform itself and this is important to mention since it’s a huge driver of retail sales—but this isn’t social commerce.

Even though both approaches lead to sales (nearly 70% of respondents in a 2021 CouponFollow survey said they bought something from a retailer’s website after clicking on a social ad), social commerce is focused on the sale itself happening within a given social platform.

A platform-level look at social commerce

To get a tangible picture of what social commerce looks like at the platform level, here’s a short list of what each platform is actually doing to facilitate sales within their gated environments:

  • Facebook Shop, introduced in 2020, is a mobile-first shopping app that lets merchants create an online store within Facebook. Retailers can showcase and sell products from their catalog, track deliveries, and communicate with customers on Messenger, WhatsApp, and Instagram.
  • Instagram Shopping allows users to buy products featured in Instagram content by clicking on product tags. As with Facebook, merchants create an Instagram shop (e.g., storefront within Instagram) to add/feature products from their catalog. Products can be tagged within Stories and posts. The tags link to the shop where Instagram users can browse more products and/or complete a sale.
  • Pinterest’s Shopping Pins let users buy products directly from “shoppable” Pins. The Pins are enriched with metadata, so they contain basic product information (price, availability, product title, etc.) Users who see a “Buy” button below a Pin can complete the checkout process from within Pinterest. Currently, the feature is only available to U.S. users.
  • Twitter Shop Spotlight lets users buy from select retailers by scrolling through a carousel of products on a merchant’s profile. Tapping an individual product opens an in-app browser where the user can complete the purchase from within Twitter. The feature, introduced in March 2022, is still in its very early stages and it’s only available to a few Twitter-selected brands.
  • TikTok Shop is the commerce feature of the popular short-form video app. It allows users to buy products from within TikTok by clicking on a product link in a video or ad or via a “product showcase” tab. Merchants must create a TikTok Shop to manage products and incorporate them into live promotions, ads, and within organic posts.
  • YouTube Live Shopping, was a feature introduced during the 2021 holiday season. The feature  lets creators collaborate with merchants for live “shoppable” events with exclusive access to products. YouTube also lets merchants sell directly on YouTube as part of the Buy on Google program (only available for U.S. users). When a tagged product is clicked (from within a video), the user is taken to a product page where they can complete their purchase.

While the shoppable features on social platforms vary by platform, they all share one common goal: to make it easy for consumers to buy products directly from social media without leaving the app.

What is the trust problem with social commerce?

As consumers grow ever more vigilant about sharing their personal data with companies, particularly credit card and payment information, they’re hesitant to embrace social purchases.

Half of respondents in a 2021 Accenture survey said trust is the biggest barrier to adopting social commerce. Since social commerce is still so new, consumers unfamiliar with buying on social platforms aren’t yet comfortable letting social platforms manage the payment process. In fact, 43% of respondents in the CouponFollow survey indicated they don’t trust social platforms to handle payment.

Social commerce trust concerns among consumers include:

  • Fear a purchase won’t be protected, refunded, or exchanged
  • Skepticism about seller authenticity
  • Concerns about security, particularly among older shoppers
  • Worry that personal data will be mishandled
  • Skepticism about quality and/or validity of products
  • Unfamiliarity with a brand or product
  • Too many negative comments raise suspicion

Since it’s easy to comment on and interact with social posts, potential customers get instant feedback about the merchant they’re buying from. This includes customer opinions about the quality of a product and information about shipping speed, ease of returns, and customer service.

While this is useful for potential customers, it also works the other way around. Too many negative comments about a product, slow shipping times, or unresponsive customer service can impact trust and deter potential customers. Too few comments or likes also inspire a lack of trust because it puts the validity of a product or company into question.

The current reticence about completing a purchase within a social platform drives consumers to either abandon the purchase altogether or complete the sale on the retailer’s website. Over 60% of purchases from social media are completed externally.

When people do make a purchase on a social platform, the order value remains small. The average purchase made through a social platform is $63, though this increases as consumers become more comfortable with social shopping.

The cure for social commerce mistrust

Overcoming the trust barrier falls largely on social media companies who must place an emphasis on data protection, security, and privacy. But there are things that retailers can do to help inspire trust and confidence when engaging in social selling.

They include:

  • Making sure products are authentic and high quality
  • Shipping products quickly
  • Having a responsive customer service team
  • Making the return/exchange process easy (and fast)
  • Clearly listing product information and pricing
  • Leveraging social proof like user reviews, testimonials, or ratings
  • Building a strong social media presence with engaging content
  • Offering discounts or promotions
  • Prioritizing data protection before and after a customer makes sale

Certain things move the needle more than others. Establishing authenticity (e.g., convincing customers that your brand and business are real) is one of them. Nearly 90% of consumers in a recent Stackla survey said authenticity from brands impacted their decision to purchase on a social platform. Note:  authenticity = a brand is “relatable” and “real.”

Other top motivators that convince consumers to move from consideration to purchase include discount codes, friend recommendations, and product reviews.

Acting quickly when or if there’s a data breach is also important to maintaining (or rebuilding) customer trust. In the event of a breach, being open and honest about what happened, what steps are being taken to mitigate the issue, and what customers can do to protect themselves helps contain the damage.

While there’s no sure-fire way to guarantee social commerce success (yet), paying attention to the factors that inspire trust among potential customers is a good place to start.

The huge promise of social commerce

Nearly half of consumers in the CouponFollow survey said they’d made at least one purchase with a retailer on a social platform. Facebook, Instagram, and Twitter are the top platforms for social buying (in that order), with Facebook and Instagram comprising 57% of purchases.

Social commerce has huge potential. It’s a channel being embraced by global shoppers, particularly in China. In fact, a third of Asian internet users made a purchase from a social network in 2021.

In the U.S., social commerce sales will exceed $45 billion in 2022, driven by over half of U.S. adults making a purchase from a social platform. But the top reason cited for not taking the social commerce leap is distrust, mainly for how platforms handle payment information or being unsure of the legitimacy of a product.

Understanding the issues around social commerce trust helps retailers create strategies for social selling that overcome the trust barrier and result in more sales.

Facilitate social commerce with Kibo

Kibo Headless eCommerce or Kibo’s composable commerce platform facilitates social commerce by making it easy to connect your eCommerce store with any social platform. With Kibo, you can create a seamless social commerce experience for your customers by featuring products on social media and allowing them to purchase directly, without ever leaving the platform.

Kibo’s powerful APIs also make it easy to share product information, reviews, ratings, and other social proof across all your social channels, enhancing your efforts to inspire trust and confidence among potential customers.

Intuitive and interactive social commerce experiences not only build trust, they increase loyalty, inspiring repeat purchases and customer advocacy.To learn more about how Kibo can help you take advantage of social commerce opportunities, contact our sales team today.

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