Social commerce might be the next big thing, but what ROI can brands expect from it?

The space for social commerce is growing rapidly on a global scale. According to a report from Essence, the social commerce market size was valued at US $ 474.8 billion in 2020 and is expected to grow at a compound annual growth rate of 28.4%, from 2021 to 2028.

Another report states that social commerce in India is expected to reach US $ 16-20 billion by 2025 and US $ 60-70 billion by 2030. The digital boom, supported by internet and smartphone penetration , further contributes to the growth of social commerce. As a result, new players are entering the space.

main announcement


BestMediaInfo spoke with industry leaders to better understand the space.

A social commerce platform typically aims to make the shopping experience smooth for the end consumer. Globally, around 41% of internet users make or intend to make purchases on social media platforms. Social commerce is becoming increasingly popular in many Southeast Asian markets. In some markets like China, social commerce accounted for 13% of total e-commerce sales in 2021. According to the WARC report, around 70% of people in China have made purchases from social media websites, it also states that Singapore, India and Indonesia come next with 50%, 49% and 48%, respectively.

In this scenario, what kind of returns can brands expect?

Mansi jain

According to Mansi Jain, Managing Director and Vice President, Roposo and Commerce for Glance, many B2C brands see social and live commerce as a whole new channel for consumers. She said that brands are getting as much as 15% ROI in terms of revenue, engagement and conversion rate.

Pulkit Agrawal

Giving an example of return on investment, Pulkit Agrawal, Co-Founder and CEO of Trell, said, “Our solutions enable brands to drive and amplify their communication throughout the cycle of awareness, consideration and buy-sell. . We have observed that brands are investing more in engagement with Trell influencers, as they see a 25x growth in product pageviews on Trell Shop and a 25x increase in sales on the platform. ”

Agrawal explained that in India, where the majority of people depend on word of mouth for purchasing decisions, social commerce has the power to bridge the discovery gap through personalized recommendations and reviews. Trading platforms allow brands to expand their reach into new markets and promote their products in new geographies.

Sunil Kumaran

Sunil Kumaran, Country Head, Product, Marketing and Thwink Big, Big FM, who recently launched Big Living, a social commerce space, said social commerce will further boost the growth of e-commerce in the country. He also said that when it comes to digital, getting big numbers doesn’t take a lot of time.

“In South East Asia, it has increased rapidly over the past two years and we are also on the same path. Electronic commerce has really exploded in the country; digital and smartphone penetration is extremely high. Because digital is almost becoming a way of life, we will likely follow the same path as most of these advanced countries in Southeast Asia. ”

Will the space for social commerce be cluttered?

There is a notion that, given that so many players venture into space, it could end up getting crowded. Experts say the only way to avoid being part of this mess is to keep innovating and continuously delivering.

Agrawal said video content and social commerce platforms will continue to gain traction in the years to come. He also said platforms need to do a lot more than just entertain short product-related videos. “To gain a competitive advantage in this space, customer focus and innovation are essential for survival. Simplifying the journey of each actor in the ecosystem is essential to ensure long-term success, ”he added.

Speaking on similar lines, Kumaran explained that social commerce is an extension of e-commerce, and as e-commerce evolves, social commerce will become a very large part of it.

“Because it will be tall it is likely to be crowded. Having said that, what happens with any category is that differentiation will start to play a big role. As you would see with any of the content platforms, which have become very crowded, unless you have a strongly differentiated product, you won’t stand out. This will also happen with social commerce, ”he explained.

Social commerce is the next big thing but not the next big advertiser?

While in any space, growing market size leads to increased ad spend, this might not be the case with social commerce players.

According to Kumaran, there will be a slight increase in player advertising although it probably won’t translate into mass advertising.

“We’re a very big media outlet and yes, so for us our media presence is largely dictated by our channel. If you get an ecommerce player to go into social commerce, they will mainly promote it on their platform itself. So there will be advertising but I’m not sure there will be advertising in the mainstream media, ”he said.

Likewise, Jain said the designer economy is booming. She said they mostly relied on Glance, an AI company that delivers personalized content to smartphone lock screens. Jain said this gives them access to over a million social media users.

“We have an unfair advantage with Glance, so unlike others, we don’t have to invest in advertising per se. The majority of our spending is on Glance, ”she said.

Agrawal said, “60-70% of our growth has been generated organically through word of mouth and the amazing community we have built over the years. ”

When it comes to social commerce, lifestyle, beauty and fashion retail are the main categories that associate with these platforms. However, as marketers explore the possibilities of social commerce, categories such as travel and crypto have started to invest in the space as well.


The biggest challenge for the category, according to Kumaran, is gaining trust and engaging credible influencers.

“Social commerce isn’t any form of advertising, or it’s not just simple influencer marketing. Social commerce is done on the basis of credibility and trust. It works thanks to authentic, credible influencers who have a certain respect among the audiences they interact with. Unless you have a really good influencer list, the platform isn’t going to thrive, ”Kumaran said.

On the other hand, Agrawal said there is a lot of skepticism in India as a market and especially when it comes to online payments. He said: “Most of the Indian population is not English speaking, whereas the internet mainly serves the English speaking community. As a result, when individuals use the internet, they often do not relate to the content or understand the descriptions provided, leading to reluctance to make purchasing decisions. To survive and thrive in the social commerce industry, businesses must adapt and rapidly develop innovative solutions to solve customer problems.

[email protected]

Comments are closed.