Are Social Media Networks Turning Into Shopping Malls?
We’ve all grown accustomed to liking, re-tweeting, pinning, and sharing each other’s posts and materials in the world of social media, but all of that may soon be supplanted by the next step in social evolution: buying and selling.
Word is leaking that social media site Pinterest, a platform that more or less operates like a digital scrapbook, is planning on adding a “buy” button to its interface. The news comes our way via Recode, which reports that Pinterest has had the idea in gestation for a long while, and appears to finally be willing to pull the trigger on its implementation. The network itself boasts 70 million daily users, and by moving forward with its new e-commerce strategy, is finding a prime way to further monetize all of that traffic.
Like its social media counterparts Facebook and Twitter, Pinterest has focused on generating revenues through advertising sales thus far. But making the jump to e-commerce will be a rather large and potentially monstrously profitable change. And Pinterest isn’t alone. Both Facebook and Twitter have also been kicking the idea of adding a ‘buy now’ button to their platforms, and it appears that even Google will be getting in on the action.
The risk that these social media networks run when enacting this plan, of course, is that they will ultimately malign their respective user bases. That was the initial fear when Facebook first started to implement advertising several years ago, and instead of scaring away users, the company became an international business power. Thus, other networks followed suit by adding paid advertising with little to no negative effect. Adding e-commerce and further revenue-driving capabilities to these sites seems like the next logical progression for them to make, especially with coming valuations and plans for further expansion.
When you crunch the numbers on how much money is out there and up for grabs, it only strengthens the case for social media companies to jump into the fray. Amazon has really pioneered the platform for e-commerce over the years, and by adding “buy now” buttons to their interfaces, social networks will start to straddle industry lines by assuming a different identity than the one that sparked their initial growth.
Really, though, it’s hard to blame the leadership behind these social media giants for wanting to make this move. eMarketer reports that worldwide retail sales topped $22 trillion in 2014, and 5.9% of that — or $1.3 trillion — was through e-commerce sales. By 2018, that share is expected to grow to 8.8% of all sales, and probably continue an upward trajectory from there.
So, using 2014’s numbers, there is $1.3 trillion in potential revenue being spent by consumers online this very moment. It would really be foolish for social media companies — who already have some skin in the game on some level — not to try and siphon off some of those dollars for themselves. Social media use accounts for 22.5% of all the time Americans spend online, according to e-commerce company Wiser, and consumers are 71% more likely to buy products from a brand that they currently follow on social media. Companies like Pinterest, Facebook, and Twitter obviously have our attention, so it only makes sense that they should bridge the gap between buyer and seller, while taking some commission for themselves.
Otherwise, wouldn’t consumers just jump over to Amazon and order it? There’s little reason not to simply step into that role, and act as the intermediary.
Again, the only real risk any of these platforms are running is changing the experience for their users, and ultimately scaring them away. But if all of these platforms are adding e-commerce capabilities at roughly the same time, it’s really limiting where users can ultimately flee to. That may not be intentional, but it’s certainly going to work in their favor. And it’s really unclear whether users will actually see their experience change on these sites, other than simply seeing “buy now” buttons, and actively using or ignoring them.
From a consumer and social media user’s perspective, the biggest difference the implementation of e-commerce protocols on social media networks may simply be that these platforms adopt a more Amazon-esque appearance or functionality. But they are social platforms first and foremost, so there probably isn’t too much to worry about.
For social networks themselves, there’s really no downside. With literally trillions of dollars up for grabs, there’s no reason no to wade into the e-commerce fight. Amazon and others may find a way to counter, but for now, online shopping is about to get a lot more social.