Social sites move to boost retail sales
Photo sharing social sites have become hugely popular over the past few years as consumers check out clothing and other products. The challenge for the sites and the retailers using them has been to figure out how to turn browsing into purchases. Now, it appears as though Pinterest and Instagram are ready to address the challenge with buy buttons.
The opportunity to use Pinterest to generate sales is supported by the findings of a new Millward Brown study. A Fortune article, which references the research, reports that 93 percent of active pinners say they use the site to plan purchases. Eighty-seven percent report having made a purchase because of Pinterest.
When Pinterest users see "buyable pins" on the site, they can now click and receive a list of attributes such as size, color and quantity, make a selection and click the buy button in order to complete the purchase. At this point, neither shoppers nor merchants will pay any fees, so it is not clear how Pinterest will make money.
The Instagram Buy button, similar to the one Facebook piloted last year, allows advertisers to include a button on their ads, which takes users out of the Instagram app to pages where they can complete shopping transactions.
Photo: Pinterest
The recognition of the growing importance of smartphone-enabled, instant shopping isn’t restricted to the online world. Ad Age reports that a U.K. company called Powa Technologies is rolling out its PowaTag, a QR code-like image that, when scanned with smartphone apps, places the item from the advertisement directly into a mobile shopping cart. Television and radio advertisements will also be able to make use of the technology by sending out audio signals that will interact with smartphones in the same way as the scanned tags.
Powa Technologies CEO Dan Wagner told Ad Age his company is currently working with 1,200 brands, which will begin running the PowaTags this summer.
Discussion Questions
Do you expect to see a marked increase in shopping via social sites over the next several years as Pinterest, Instagram and others add buy buttons? How do you see the social media shopping experience differ from other forms of online shopping and what must retailers do to address that behavior?
Poll
BrainTrust
Dan Frechtling
CEO, Boltive
It’s about time. Pinterest and Instagram have been leaving a lot of money on the table by not offering buy buttons. This is the next logical step in what I call social purchases. Retailers now have more reason than ever to become involved with social media.
80-plus percent of consumers already research online and a vast majority consult one or more social media sites as part of that research. Social media can be a rich sale opportunity if it can be orchestrated for today’s omnichannel shoppers.
The problem with social media sites to date is that consumers have, well, been social. Facebook and even Twitter have historically been text-based, focused on interacting with friends.
Pinterest and Instagram are exclusively visual-based. A quick scan gives you a visual reference on not only friends’ preferences, but a larger view of fashion and trends as a whole. Without having to engage in any discussion, Pinterest and Instagram provide immediacy, and a context to filter what’s in style and what’s trending. Pinterest is already a premiere source for “pre-shopping.” The challenge has been conversion.
The other historical problem with social media has been that it was not very easy to make an immediate purchase. The “one click” to buy certainly makes it easier to purchase items, especially impulse purchases.
If we have learned anything from Amazon, it is:
The power of immediacy.
The power of visual and rich content.
THE POWER OF ONE CLICK TO PURCHASE.
Expect to see one-click buy buttons popping up everywhere.
For social shopping to take off, social sites need to think mobile apps first.
Around 80 percent of users access Pinterest through mobile. Ads are interruptive and entice users away from what they were viewing to make a purchase. Because of the small screen size, it’s awkward to click to another site to complete a transaction on a smartphone.
Social sites that reduce friction will win. Pinterest and Facebook allow purchases from within their apps. Facebook allows users to store credit cards for faster checkout. Instagram takes users away from the image to an “in-app browser,” and does not process payments within its app.
For now it’s a free-for-all, literally. With no commissions charged to participating retailers, what a great time it is to experiment.
Pinterest and Instagram are just two more social channels where the target customer “hangs out.” There will be plenty more where these came from. My observation is that the marketing is based on images, just like the old days of looking through catalogs. The cool thing about these social sites is that customers post their images too. So you get the word-of-mouth marketing bump with the strategically-placed marketing efforts.
As my 19-year-old daughter would say, “turns out, people love social media … ” (pause, eyes roll). Yeah, it’s HUGE! A very non-evasive way to sell things using a third party you trust. It’s the way of the future: curated goods algorithm-ed to your taste.
The perfect combo of brand and technology, IMO. Relax Boomers, you can’t control it. Just make sure you’re focusing on quality.
There is no question that transactions will grow with the convenience and popularity of social sites and brands leveraging these channels. It’s just too easy for shoppers to purchase via this path. The personal, crowd chat-style reviews of products drives confidence in consumers’ minds.
It’s going to be huge, and ubiquitous and the roll-out is going to make Amazon’s one-click positively quaint.
Absolutely! There will be increased social selling by retailers as customers have been pulling retailers in that direction. Social shopping experience is different than traditional forms of online shopping as it takes place in a public forum where customers can instantly share what they’ve purchased, their reviews of the product/service, etc. Customers value the trust economy that is inherent with transparent shopper reviews and retailers will win if they embrace this new way of shopping. Retailers must also be prepared to provide social customer service with a social-first mentality if they are to use social channels to sell.
I am especially excited to see consumers using buy buttons or QR scans while watching TV or streaming. This will be huge and retail better be ready.
And that’s my 2 cents!
Some quick stream of conscious unedited thoughts (my disclaimer):
1. Hey Retail Software Companies including the big ones: if this is a method being using by shoppers, then where is your buy button? Or how about a try button? Or how about a reserve button/number in stock? Or how about measuring item demand based on number of pins made by a retailers customer?
2. Hey retailers: some of your customers are on Pinterest now—they are in a sense their own personal boutique—reach their followers, let them earn money for their curating talents. You know about stores-within-a-store, how about a pinner within a retailer?
3. A Pinterest board can easily be a person’s closet, or shed, or living room, or kitchen. Every retailer should be hooked into these boards. If a retailer is following their customers closets and those closets have a pin that is shared by others, why can’t the retailer do a group buy?
4. Retailers might want to find the top pinners in their customer base, why not let them look at items that you are considering for your stores? If they like it they can pin the item in their closet, kitchen, shed, wish lists/scenarios, etc. They can help you test the waters in certain customer/wish-scenario affinity groups.
5. Buyers and merchants have natural talent, they are professional pinners. Retailers have those people on their payroll. What if you create roll-pinners, like Macy’s Accessory Pinner—starring Jane Doe. That way you can keep the followers if Jane leaves.
Some of what I am suggesting didn’t really need the buy button, but now that photos are electronically connected to downstream activities we have new scenarios that retailers can ponder.
As an example:
Scenario: find in a followed Macy’s customer’s Pinterest closet, note local availability, reserve and view/try in store, get discount for pinning item in your closet, earn points for subsequent pins.
I think that social commerce will expand significantly in the near future. It simply makes sense to meet consumers where they are and make it easier for them to make purchases.
Shopper behavior could differ vastly across social sites based on demographics and layout of the site/app. Conversion rates are much lower on mobile compared to desktop, so it will be interesting to see if buy buttons on these sites will have an impact.