The Rise of Social Commerce and Gamification of Online Shopping Experience
For the past 20 years the rise of the internet and technological advancement have changed our lives drastically. From daily weather check, news reading and communication to education and work – there is almost no aspect of our life that would stay untouched by the power of the internet. The reason is obvious, the internet makes our lives easier, simplifies our mundane routines and simply saves a lot of time. Moreover, the spread of the internet went hand in hand with the advancement of technologies, especially smartphones which led to such unavoidable results as transferring some parts of our lives into the internet world.
One of these aspects is shopping, which has transformed for the last couple of decades significantly. If previously people had to go from shop to shop in order to purchase even the most basic necessities and spend hours on it, now all the shops are just one click away whether you want to order food or purchase clothing. Additionally, shops even personalize their product offer specifically for every customer taking into account their buying experience and preferences, saving even more time for consumers. On top of that, they add extra discounts or coupons for ordering online, send ‘thanks for shopping with us’ gifts and provide special offers for loyal customers. Therefore, customers save both time and money and have their purchases delivered right to their doorstep like it’s Christmas every day.
As more and more people prefer online shopping, the e-commerce business is expanding rapidly. It is predicted that in the upcoming years the global e-commerce market will grow to unprecedented numbers reaching USD 26.59 trillion by 2027. The driving force behind the growth of online shopping is increasing adoption of digital technologies, changing consumer behavior and the rapid expansion of internet access worldwide. One of the crucial roles in e-commerce is played by so-called social commerce which increasing popularity is determined by increased usage of smartphones for consumers’ daily tasks and online shopping.
So, what is social commerce and how is it different from online shopping? Social commerce is a form of e-commerce that takes place on social networking websites such as Instagram, Facebook, X (formerly Twitter) and others. Products and services are promoted and sold on these networking websites where people can also comment on them, put likes, share and repost them. Marketers also use different tactics to promote their products/services and make ad campaigns more successful. Some of them include using videos, user-generated content, hashtag ad campaigns, collaboration with celebrities and influencers, gamification and interactive video ads (IVA) produced by Multiplayer Agency which is one of the recent tactics used in social commerce. So, let’s look how social commerce became so popular and what role gamification is playing in it.
The Power of Online Shopping
Let’s begin with online shopping and its growing popularity among different groups of people worldwide.
There are over 2.14 billion online shoppers in the world and, according to the numbers provided by Statista, global retail e-commerce sales reached nearly 6 trillion U.S. dollars and is projected to continue growing over the coming years. By the year 2027 it is expected that the numbers will grow 39 percent and surpass 8 trillion dollars.
These numbers indicate that the popularity of online shopping is undoubtful and, taking into account how impressive the numbers are, more improvements and developments can be expected in the e-commerce sector.
Is Online Shopping Taking Over the World?
Currently it is difficult to find a person who has never ordered anything online and there is extensive research and studies explaining what the reasons for this phenomenon are. But even just looking at our consumer experience we can see that the main two reasons for this are convenience of online shopping and unprecedented usage of smartphones.
As indicated in the report “The Next Billion Consumers: A Fast-growing Opportunity for Digital Commerce” provided by Accenture, consumers globally now prefer online shopping due to the wider product selection, better pricing and overall convenience.
Moreover, 80% of surveyed consumers indicated that they use different online channels such as social networks, search engines and other online services to research products before buying them. Additionally to buying online, people are also influenced to buy products by social media and other online platforms. 76% of respondents admitted that ‘likes’ and ‘good comments’ on social media influence their buying decisions.
Interestingly, mobile devices are playing a crucial role in online shopping now even though they were considered no more than a wireless device for connection just 20 years ago. However, now the majority of the population worldwide cannot imagine their daily life without a smartphone. When it comes to shopping, in 2023 over 70 percent of all retail website visits around the world are accounted for by smartphone users. It vividly demonstrates that smartphone integration into shopping will continue shaping the shopping experience in the future.
One more important factor in the spread of online shopping is the effect that social networks have on people. Everyday people spend hours on Instagram, Facebook and other platforms, see dozens of ads and posts by influencers using some products or services. This content naturally creates a feeling among people that they need to “keep up with the Joneses”. 40% purchases are made because people were influenced by social media even though they might have probably not even considered buying anything.
The presence of business online is also underlined by the fact that 63% of shopping occasions begin online, whether or not the consumer ends up making their purchase online or in-store.
Therefore, having products and services presented on different platforms including social networking websites is not only beneficial in terms of establishing online presence, but also important for capturing customers’ attention during the earliest stages of their shopping journey.
We can see that the development of smartphones, internet and social networking websites is a match made in heaven that naturally led to the creation of social commerce and its impressive growth. For many years we have witnessed that commerce is going to ‘the most crowded places’ – from newspapers, to TVs, to websites, to social networks, trying to get the attention of as many people as possible. So, it’s not a surprise that such platforms as Facebook and Instagram that have billions of users worldwide became the next big thing in the world of online shopping.
Social Commerce – Next Big Player?
According to a report by Straits Research and verified by Statista, the revenue of social commerce around the globe has reached $913 billion for the past year and is predicted to grow by 31.6% a year reaching $6.2 trillion by 2030.
Social Networking Sites – a Bridge Between Customers and Commerce
The most widespread platforms for social commerce are Instagram, Facebook and TikTok where the vast majority of brands can present their products and services and use the platforms according to their needs.
Instagram offers a number of tools that can significantly boost the online presence of a business and lead to a more enjoyable customer experience. Instead of clicking the links and trying to find the desired products on a website, customers can directly access it at the moment of discovery due to the interactive clickable content.
Products can also be tagged in posts, stories and ads, making the access to them easy and providing a safe checkout.
Facebook has similar functionalities to Instagram due to being owned by Meta. Shops can be found on the business Facebook page, in posts and stories where the products are tagged. Users can save the products they liked and even continue with checkout without leaving the app.
TikTok took one step even further in social shopping providing both customers and sellers with a number of useful and effective tools.
They provide the most seamless integration of products into the content of the app without disrupting the overall user experience. On the one hand, users can enjoy the content they like without being bombarded with endless unskippable ads. On the other hand, users interested in discovering new products can easily find them due to integrated products, shoppale videos and interactive ads.
Driving Forces of Social Commerce
But what are the driving forces behind the social commerce that makes it take over the world? Market specialists underline several important factors that push social commerce revenue to such highs.
Firstly, as it has already been mentioned above, the technological advancement allowed consumers to have access to their favorite products and services right through their smartphones making customers just a couple of clicks away from the goods they need. The number of smartphones is currently around 5.25 billion around the world and growing. So, as far as the trends go, there is no doubt that social commerce will keep rising along with it reaching $3.44 trillion by 2027. However, it is not only about having a smartphone, it is about the amount of time that users spend on mobile devices. According to numbers, in the US alone, daily people spent almost one hour more in 2023 than they spent 4 years ago. While in 2019 on average users were spending 225 minutes every day on smartphones, it increased by almost 23% by 2023.
Of course, a substantial amount of time is devoted to browsing through social network platforms. As of 2023, the number of social media users has increased to a record 4.9 billion users worldwide.
What’s more, these users are not tied to a single platform only, their digital footprint spreads across six to seven platforms a month. That is why we can see the increasing multi-platform marketing bombarding, turning social networks into a one-stop shop.
Unsurprisingly, social networks are taking their fair share of attention when it comes to commerce. On top of that, it created the whole industry of influencers, product placement and marketing tricks in order to come up with the most effective way to sell products and services. Even though social commerce is a relatively recent phenomenon, it has already gained significant trust among consumers. Thus, 50% of millennials place their faith in social media influencers’ recommendations and 88% highlighted their appreciation of authenticity they can find in reviews on social media platforms.
As for the brands’ owners, the possibilities that social networks offer are astonishing. The combination of social interaction, sharing, commenting, learning who’s using what and the ability to turn social signals into potential e-commerce conversions is bringing online shopping to a brand new level.
The Allure of Gamification in Social Shopping
Gamification arrived to the marketing and e-commerce domain as the answer to the main challenges that marketers and sellers had faced. Even though the abundance of online shops and the simplicity of the shopping process seem to drive more sales, there are some problems that make sellers seek ways to avoid them and keep customers interested. Some of the challenges include:
Abandoned Carts
According to the Baymard Institute, the average documented online shopping cart abandonment rate is 70,2% which constitutes about $260 billion worth of lost orders.
Brand Loyalty
It is understandable that consumers always try to find the best offers in order to purchase the goods for a better price. Therefore, brands and shops provide a variety of discounts and special offers for their customers, so switching from one brand to another that offers better options is a completely normal consumer behavior. However, from the brands’ perspective, such behavior is a challenge, because luring new customers is both time and money consuming. It costs 5 times more to acquire a new customer than it does to retain a returning one. Moreover, loyal customers spend 43% more money on their favorite brands. Therefore, keeping customers interested is one more challenge that is vital for online commerce to address.
Customers attention
As it has been mentioned above, the abundance of brands, shops and products caused the difficulty to attract the attention of customers. Taking into account that on average a person is exposed to 4 thousand advertisements a day, it is impossible to expect that people will attentively scrutinize each of them. Therefore, finding the ways to make a brand stand out is a significant challenge that companies must overcome to succeed.
Therefore, we can see that gamification elements are being utilized more and more in order to address the common issues that brands face. Even though we can see some gamification elements in the physical world, such as an interactive brochure of a car company Peugeot, the real power of gamification became apparent with the advancement of smartphones and internet technologies. Gamification gave a start to the spread of such efficient marketing tactics as loyalty programs, reward systems, interactive challenges, limited-time offers, flash sales, augmented reality (AR) experiences and others. Let’s look at them a bit closer.
Loyalty Programs and Reward Systems
Loyalty programs and rewards are powerful tools in the arsenal of brands due to the number of advantages they offer to customers. Firstly, they provide people with financial benefits: they can purchase goods and services with discounts or special prices. Secondly, it affects the overall customer experience, because it makes customers feel a part of a bigger community giving them an important feeling of belonging. 81% of consumers agree that a loyalty program membership influences their likelihood of making a purchase. Moreover, it is beneficial for brands not only in terms of sales, but in terms of understanding their customers’ purchasing habits, thus, making their offers more effective. The list of companies that offer customers loyalty programs is long including such brands as Starbucks, Sephora, Mac, Nike and others.
For example, Sephora’s ‘Beauty Insider’ loyalty program provides their customers with special offers, points collection, recognition and special titles for achievements.
In 2023 they started utilizing the full power of gamification creating challenges to encourage participants earn more points. Tasks include online and offline activities as well as non-purchase tasks.
Overall, such gamified experience engages customers, makes them more interested in following brand’s offers and news, increases overall interaction with a brand resulting in better brand-customer relations.
Livestream Shopping
Livestream shopping first appeared in China in 2016 as an attempt of a famous Chinese platform, Alibaba, make customers more involved in the Single’s Day shopping.
The idea of livestream shopping is similar to the programs broadcasted on TV where a host would demonstrate products and everybody could call and order it. However, like anything you transfer from TV to digital, the interactive options are much broader: users can click on a product and buy it, send comments and reactions, ask questions and be an active participant of the livestream. Liveshopping had a tremendous success in China and demonstrated impressive results. For example, in 2020, the first 30 minutes of Alibaba’s Singles’ Day presales campaign on Taobao Live generated an impressive $7.5 billion in total transaction value. It vividly illustrated the power of making customers active participants of the shopping experience telescoping their journey from discovery to purchase. As for the leading categories of livestream shopping, unsurprisingly, they are the products that can be easily demonstrated such as apparel and fashion items.
After such a tremendous success, livestreaming was destined to spread to Western countries and soon after such social networking platforms as Instagram and Tiktok started working on adding this function to their platforms. Even though Meta has recently stopped liveshopping, they continue to offer livestreaming tool that brands and influencers can use to connect with their customers and promote products.
For example, popular fast-fashion retailer, Shein regularly conducts livestreams providing customers with the information on the latest trends, demonstrating products and discussing them in the live stream. Customers can watch it on such social platforms as Instagram, Youtube, Facebook and others and receive bonus point and discounts for participation.
But not only big brands rely on the power of live streaming, small businesses also benefit from the boost that livestreaming can provide as the revenue stream. A pre-owned designer handbags business called Bagriculture is one of them.
When learning about livestreaming the CEO of Bagriculture decided to transfer his business from physical to digital world. While physical shops were making $100 thousand, livestreaming allowed them to reach a broader audience and generate $100 thousand a day. By livestreaming at several platforms simultaneously, the business could establish better connections with customers by answering their questions and demonstrating products, thus, providing higher quality customer experience and reaching new customers at the same time. “All the metrics exceed any other form of shopping I’ve seen – period,” Velez, CEO of Bagriculture, said.
TikTok is also one of the social platforms that creates and provides tools for commerce growth. Taking into account that on average a TikTok user spends 858 minutes per month on the app, it represents a lucrative opportunity for businesses to catch the attention of a substantial number of users, especially among Gen Z.
In December 2020, Walmart and TikTok partnered to pioneer a novel shoppable live stream experience for the U.S. market. This collaboration, targeting the beauty segment, yielded impressive results, showcasing the potential of live commerce to engage audiences and drive sales.
The initial live stream event exceeded expectations by 700%, garnering significantly higher views than anticipated. Additionally, Walmart’s TikTok follower base witnessed a remarkable 25% growth, demonstrating strong audience engagement and brand awareness.
Capitalizing on this success, Walmart hosted a second live stream event, the “Spring Shop-Along: Beauty Edition,” in March 2021. This iteration featured renowned beauty influencer Gabby Morrison alongside other creators, offering an interactive experience brimming with fresh product recommendations and shoppable tutorials.
The event showcased a diverse selection of national, private, and Black-owned beauty brands, catering to a wider audience. Viewers gained valuable insights through product demonstrations and trend-focused makeup, skincare, and haircare routines. The seamless shopping integration within the TikTok platform facilitated instant product purchases, enhancing the overall experience.
Along with live streaming , TikTok offers a variety of additional options for businesses. They can be entitled to being the most advanced networking platform in terms of business tools and customer experience. They are one of not many platforms that offer interactive and gamified tools for brands which include:
- Live shopping adds;
- Interactive add-ons;
- Dynamic showcase buttons;
- Call to action buttons and many more.
Therefore, by providing businesses with these creative and efficient solutions, TikTok increases the possibility of customers visiting a physical store by 350%, buying a product – by 150% and visiting a website or app – by 40%.
Augmented Reality (AR) Experiences
Augmented reality is a relatively new technology that has already had a significant effect on the world and people’s lives. In the world of commerce AR is considered to be the new step in advancement of consumer experience due to its ability to encourage customers to interact with a product.
According to Deloitte’s AR Report, 56% of shoppers agree that AR gives them more confidence about product quality and over a half of people want to use AR technology to assess products allowing for a risk-free ‘try-before you buy’ experience. Additionally, AR interactions lead to 94% higher conversion rate and 25% decrease in product returns.
A number of brands have already started utilizing the AR technology in order to provide customers with a more personalized and quality shopping experience. From IKEA’s Place AR App to Nike’s ‘Nike by You’ AR filters AR technologies little by little winning the hearts of both businesses and consumers.
Luxury brand Gucci took a bold step into the future by partnering with Snapchat for the first ever global AR shoe try-on campaign. This marketing strategy of Gucci was an innovative move, aiming to generate excitement for their new sneaker collection and it certainly delivered. The campaign was focused on awareness and engagement, but the results exceeded all expectations.
The AR filter allowed users to virtually try on shoes choosing from 4 available styles. The filter also included the ‘Shop now’ button that made a purchase process much easier leading users straight to the Gucci website. This immersive experience wasn’t just impressive – it was effective. Many users went straight from virtual try-on to purchasing their favorite pair. Not only did the AR try-on experience catch many Snapchatter’s attention, it also kept them engaged, which further translated to sales. The shopping AR experience generated positive ROAS and 18.9 million unique reach.
The Future of Social Commerce: Gamified, Immersive, and Irresistible
The rise of social commerce, fueled by the advancement of smartphones, social media, and gamification, is fundamentally reshaping the retail landscape. This “match made in heaven” offers captivating experiences, fosters deeper brand connections, and drives impressive sales growth. As we look to the future, several key trends will define the evolution of social commerce:
1. Gamification as Standard Practice
Gamification’s ability to overcome common challenges like cart abandonment and low engagement positions it as an essential tool. Loyalty programs, reward systems, interactive challenges, and livestream shopping will become widespread, offering customers exciting journeys tailored to their preferences.
2. Livestreaming Takes Center Stage
Livestreaming transcends passive product display by transforming viewers into active participants. Platforms like Instagram and TikTok provide businesses with powerful tools to showcase products, engage audiences, and generate sales in real-time. This interactive format builds trust and community, fostering enduring brand loyalty.
3. AR for Hyper-Personalized Experiences
Augmented reality empowers customers to virtually interact with products, try them on, and visualize them in their space. This personalized experience builds confidence, reduces purchase risk, and increases conversion rates. As AR technology evolves, its impact on social commerce will only grow.
4. Social Commerce Goes Phygital
The boundaries between online and offline shopping are blurring. Social commerce platforms will increasingly integrate with physical stores, offering features like click-and-collect, in-store AR experiences, and live-streamed events from physical locations. This phygital fusion will provide seamless, omnichannel customer journeys.
5. Building Communities, Not Just Sales
Social commerce goes beyond transactions. Brands that leverage the power of storytelling, user-generated content, and influencer partnerships can foster passionate communities around their products and values. This emotional connection translates into brand advocacy and long-term customer loyalty.
In conclusion, the future of social commerce is brimming with possibilities. By embracing gamification, immersive experiences, and community building, businesses can tap into a vibrant and engaged audience, driving sustainable growth and creating truly remarkable shopping experiences. As technology continues to evolve, the boundaries of social commerce will further expand, offering exciting opportunities for both brands and consumers alike. This future is not just about selling products; it’s about connecting with people and shaping the very nature of how we shop in the digital age.
