The last few weeks have seen a flurry of social networks announcing plans to morph themselves into ecommerce operations. First YouTube announced plans for shoppable adverts, before parent company Google quickly followed suit with a similar concept. Then we had the excitement of Instagram and Pinterest announcing plans for what are effectively ‘buy buttons’ on the same day.
The ‘buy button’ isn’t a new phenomenon. Twitter announced plans for a ‘buy button’ back in September last year, so it was only a matter of time before the others caught up. Twitter’s ‘buy button’ caused quite a lot of excitement, not least because the infamous social network is part of a growing number of internet start-ups that gain huge valuations without actually making a profit. We’ve seen a quite a few of these so-called ‘unicorns’ recently, and investors’ logic seems to be that there must eventually be a way to make money from having that many people in the same place.
Having said that, today’s departure of Twitter’s CEO might suggest they’re running out of patience. What really interests me, though, is the effect that these sites are going to have on ecommerce more generally. It’s amazing to think that ecommerce is now affecting businesses that might previously have seemed immune to the march of technology. In March, formalwear retailer and hire service Moss Bros announced that its full-year pre-tax profits had jumped 9%, largely thanks to its ecommerce sales growing by 59%. Previously I’d have though that a customer experience as intimate as buying or hiring a suit couldn’t be replicated online, and obviously it can’t, but the convenience offered by online shopping can’t be replicated in store either. The spate of ‘buy buttons’ from the likes of Google, Instagram and Pinterest are designed to make online shopping even easier.
One crucial aspect that they all share is that the user can now make purchases without leaving the website where they found their purchase in the first place. If ecommerce is all about the conversion rate – that is, converting someone from simply browsing to actually buying – then making shopping this convenient is a good place to start. A recent article in the Harvard Business Review suggested that Pinterest is well positioned to harness the visual nature of its service, and that rivals would do well to follow suit. As a photo-sharing app, Instagram also looks like a good bet to be successful. Instagram is, of course, owned by Facebook, which has plenty of data regarding its users’ likes and interests, so its shoppable ads should be well targeted.
Are we going to see more exciting shoppable ads from the ecommerce operations of bricks-and-mortar retailers, then? Possibly, although as the Harvard Business Review points out, part of the attraction of sites like Pinterest and Instagram is that you’re likely to stumble across items they weren’t necessarily looking for, whereas the average Moss Bros shopper probably set out to buy a suit. I think there will be space for both types of ecommerce to exist, but one thing I can say for sure is that we’re witnessing the most exciting evolution of social media since it was born over a decade ago.
How much do you think internet-based shopping will change the social networks? Let me know at moira@thembsgroup.co.uk and have a great weekend!