There’s no question that the rise of social media has had a profound impact on our daily lives. These platforms have changed the way we communicate, socialize, seek our entertainment, and even get our news.
But the impact of social media extends far beyond even this. It’s rapidly transforming the relationship between businesses and the customers they serve. This has catalyzed the growth of an entirely new commercial sector: social commerce. And with the advent of social commerce comes increasing demand for next-generation payment processes, including social payments.
What Are Social Commerce and Social Payments?
Social commerce refers to an increasingly popular subsector of e-commerce in which goods and services are promoted, researched, and sold entirely on social media platforms. This capitalizes on the enormous popularity of social media by allowing consumers to complete the entire customer journey without ever having to navigate away from the social media site.
Social commerce is made possible through the development of reliable and secure social payment technologies that allow transactions to be completed through the social media portal. Social commerce offers consumers an unprecedented measure of convenience, speed, and security in progressing from interest to purchase.
But consumers are by no means the only party to benefit from the rise of social commerce and social payment technologies. The social commerce revolution is giving retailers an extraordinary capacity to reach a truly global market, increasing brand awareness and engaging with consumers around the world.
What’s more, online consumer-to-business (C2B) payment technologies enable prospective consumers without access to a bank account or traditional credit card to make purchases. This can be done particularly effectively by leveraging the popularity of person-to-person (P2P) transactions, as well as the infrastructure supporting these payments, to promote C2B business.
This also means that small retailers no longer have to confine themselves to competing with the big-box store down the street. It also means they don’t necessarily have to invest precious resources into creating and maintaining a dedicated virtual store. Rather, they can use social media to engage customers, raise brand awareness, and complete sales all in one place.
Driving Engagement Via Social
The meteoric rise of social commerce is instigating increasing calls for more and better social payment opportunities. In light of this, it appears that seizing the social commerce trend would be a no-brainer for enterprises across industries—from retailers to financial institutions.
Nevertheless, jumping on the social commerce bandwagon isn’t always a given. Before you engage your business in any new market, and before you add or transition to a new payment system, due diligence is essential.
As with any change in business strategy, conducting a thorough risk analysis should be your first priority. When it comes to the integration of social commerce and social payments, critical factors to be considered should include your tech infrastructure. At the very least, you’ll want to ensure that you have the capability to securely, reliably, and efficiently process potentially high volumes of digital payments.
The good news is that the immense earning potential of social commerce means that it could well be worth your while to invest in the infrastructure you need. Whether you’re an e-retailer or a banking institution, building your capacity to manage next-generation payment methods in their myriad forms will dramatically increase your scalability.
Enhancing the Customer Journey
When you begin the process of integrating social commerce into your business model, it’s important to remember that the customer journey will inevitably be significantly affected. After all, the whole allure of social commerce is that it grants the consumer the ability to learn about, research, and buy goods and services without ever leaving the social media platform.
This means that consumers can go from awareness to deliberation to purchase in record time without needing to find a physical store, a customer service number, or even a website. But to capitalize on the efficiency and ease of the process for consumers, businesses must work diligently to connect organizational silos that might otherwise disrupt the customer journey.
For instance, in social commerce, marketing, sales, and IT are more directly linked and more profoundly interdependent than in other types of business channels. If teams and systems are not well aligned across these diverse divisions, the result is going to be an inefficient and frustrating experience for the consumer. And that, in many cases, will cause merchants, and the financial institutions they partner with, to lose the sale.
The Takeaway
The rise of social commerce and social payment is changing the way consumers shop and the way businesses and banks do business. This subsector of e-commerce promises to truly open up the worldwide marketplace and make it accessible to buyers, sellers, and payment servicers in every corner of the globe.