Social networks have not been around for long but have managed to become an obsession of global proportions. With the meteoric rise of Facebook and Twitter, companies are still busy exploring ways of capitalising on that mania.
They have already established that social networks can be formidable tools for building brand image and fostering customer loyalty. Recommendations and product reviews on social networks can be a mighty sales booster although the platforms themselves have yet to become significant direct sales channels.
Nevertheless, Barclays predicts that “social shoppers” will be a powerful force in retail by 2021 and sales influenced by social media will reach £3.3bn within five years, or more than double the current amount of £1.4bn.
About 70% of online shoppers actively use social networking sites. By 2021, 41% of UK consumers will be making purchases under the influence of social media or through the platforms themselves, according to the bank. At present, 45% of Britons aged between 25 and 34 have already embraced social commerce and in a decade the proportion will reach 73%.
Facebook and its ilk may be greatly beloved communication tools but they are not exactly buzzing with shopping activity. On the other hand, such platforms are doing an amazing job in acting as influencing agents and multi-channel integrators. The unrelenting popularity of social media has brought the most benefits sales-wise to the fashion, footwear, music, film and grocery sectors. Direct sales through social networks are also expected to improve in the five years ahead although growth will be less impressive than that of sales influenced by the channel. Barclays forecasts an increase from £210m to £300m over the period.