The $492 billion global social commerce industry is set to grow three times as fast as traditional e-commerce, reaching $1.2 trillion in sales by 2025, according to a new study by market research and business services provider Accenture.
In the report Why Shopping’s Set for a Social Revolution, Accenture defines social commerce as occurring when a consumer’s entire shopping experience from product discovery to the check-out process takes place on a social media platform. Accenture maintained that, by 2025, it expects the highest number of social commerce purchases globally to occur in the apparel category, at 18%, followed by consumer electronics at 13% and home décor at 7%. Fresh food and snack items should also represent about 13% of global sales but will almost exclusively occur in China. Accenture predicts that beauty and personal care, although smaller in terms of total social commerce sales, will quickly gain ground on e-commerce and capture more than 40% of digital spend in the category across key markets by 2025.
By Accenture’s definition, 64% of social media users surveyed said they made a social commerce purchase in the last year, which Accenture estimates to reflect almost two billion social buyers globally. Gen Z and Millennial social media users will drive the growth, the company asserted, accounting for 62% of global social commerce spend by 2025.
Although it represents a significant opportunity for large businesses, individuals and smaller brands also stand to benefit from social commerce. About 59% of social purchasers surveyed said they are more likely to support small and medium-sized businesses through social commerce than they are when shopping e-commerce websites.
Social commerce can have long-term benefits, Accenture pointed out, as 63% of study participants said they are more likely to buy from the same seller again. This suggests social commerce could have advantages in building loyalty and driving repeat purchases.
The prospects for social commerce don’t come without qualifications. Accenture indicated half of social media users, particularly older users, worry that social commerce sellers will not protect purchases or refunded properly, making trust, an early factor in e-commerce acceptance, the biggest barrier to adoption.
“The pandemic showed how much people use social platforms as the entry point for everything they do online: news, entertainment and communication,” said Robin Murdoch, global software and platforms industry lead at Accenture. “The steady rise in time spent on social media reflects how essential these platforms are in our daily life. They’re reshaping how people buy and sell, which provides platforms and brands with new opportunities for user experiences and revenue streams.”
