By Taylor Fielding, CEO of TFM Digital
We are the generation of instant gratification. From our media, through to our retail habits. Waiting is no longer a necessity.
Aussies spend just shy of two hours every day on social media. Brands understand that it’s about meeting the people where they spend their time, which is why digital ad spend represented almost three quarters of total ad spend in the country last year.
And one area where we’re going to see big changes in 2025 will be the number of items that are purchasable through shoppable ads. Social commerce now accounts for almost 1 in 5 e-commerce sales globally, which is massive, and it’s only going to grow.
Rise of social commerce
It’s already been a decade since the first business profiles launched on Instagram. Since then, we’ve seen Twitter’s ‘Buy Now’ button come and go, Instagram and Pinterest battle with platforms to make purchases in-app and most recently Paramount spruik shoppable TV with a new Survivor pilot.
In 2020’s is when tech, along with demand from brands has taken off. As an SEO agency, we’ve seen evidence of where digital ad spend is delivering the best returns, and often it’s outside of the likes of Meta and Google.
TikTok’s meteoric rise and its success in the live streaming space is starting to deliver new opportunities.
Gamechanger: TikTok
One US study found 40% of 18 to 26 year olds have made at least one purchase on TikTok Shop, compared with 14% of Gen Xers. But check out the trajectory for TikTok heading into next year and beyond. In the US at least, it’s already on course to be the primary platform for social buyer conversions in 2024.
Aussies are clearly favouring the platform in terms of hours spent with platform, with monthly hours spent on TikTok topping 42, twice the length of time than the next social app Facebook.
Where we’re going
Depreciation of cookies [since iOS 14 and beyond] and walled gardens of platforms have been other drivers behind the growth in social commerce according to Sam Chadwick, head of marketing at Muscle Nation.
Getting access and valuable conversations with customers is increasingly starting on social, given the time spent on these platforms.
Indeed tactics are changing. “Brands need to be leaning in harder towards social commerce. The biggest success I’ve seen from brands doing significant volume in the US have been treating it like an affiliate platform, and letting creators have their own tone of voice,” believes Sam.
Success across shoppable ads, have often been for lower ticket items to date. As the market matures I expect the average order value will increase with greater adoption. Chadwick adds that testing and iteration are the key: “Don’t just test one thing, try using employees vs. creators, different angles, and see what sticks for your brand.”
Growth in Aus
Social commerce is a habit adopted by 95% of Chinese online shoppers. In Australia that figure is just 57%. This means there is a lot of room for growth. I also foresee the bigger ticket items to be purchased through social/digital channels.
If you’re hesitating, don’t, act today. If luxury automotive brand Mercedes-Benz is earmarking 25% of its sales coming from online sources in 2025, then I imagine your brand should too.
For those that haven’t started, what are you waiting for?
TikTok Shop has been so successful in the US, now converting almost 44% of US users into buyers in 2024, and it’s already rolling out Shop globally to 13 other territories. Depending on the fallout from any potential ban in the US, the roadmap for further global expansion may be brought forward.
While other social platforms are working on copycat live shopping experiences, the competition in this space will intensify, leading to a greater market adoption from brands. Social streams of packing product live have already proved successful and according to Chadwick, it’s the novelty of seeing your order come in live which draws in a greater volume of purchases. So expect more partnerships with creators heading into 2025, and it’s those brands that lean in when it comes to social, that will win out.
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Top image: Taylor Fielding