The Social Shopper: Millennials And Gen Zers Are Changing The Face Of Social Commerce

The last two years of crisis have undoubtedly pushed direct-to-consumer brands to rethink how they interact and market to shoppers in the digital world. The eCommerce revolution, mostly driven by the forces of the world wide web and social media has helped brands connect with consumers, and shoppers find brands that align with their social behavior. 

Although eCommerce has remained a stronghold for many brands before and during the pandemic, a new era of online shopping is being born from the generational shift in consumer behavior. 

Today, social media has become a go-to place for online shopping. It’s not only because social media is the platform of choice for a majority of Millennials and Gen Zers. It’s become a place where these shoppers can follow new trends, search for items, read shopper insights, interact with influencers, and communicate with like-minded brands.

Social commerce, which entails shopping on native social media apps and platforms, is now common practice among younger consumers. By far it’s outpacing the likes of eCommerce, as recent estimates by Accenture found that the $492 billion global social commerce industry will outgrow traditional eCommerce to more than $1.2 trillion by 2025. 

Online shopping is now in the midst of a social revolution, and at the forefront of this growth, Millennial and Gen Z consumers are leading the charge. 

Don’t underestimate Millennials and Gen Zers consumers

Coined as the generations that were raised by the internet, Millennials (born between 1980-1997) and Gen Zs (born between 1997-2006) are gradually changing how businesses market and sell their products and services in the digital ecosystem. 

For starters, around 58% of Millennials in the United States claim that social media is an important tool of information when making shopping decisions. For Gen Zers, this percentage was around 50%, while Baby Boomers were the least influenced by social media when making shopping decisions. 

Piloted by social media, and influenced by the digital era, both Millennial and Gen Z consumers are now the driving force behind the shift in eCommerce trends. 

The same study by Accenture as previously mentioned found these two groups will be the primary growth behind social commerce in the coming years, accounting for more than half, or 62% of global social commerce spending by 2025. 

The digital habits picked up during the pandemic have changed both their social and work-related interactions. Social media is perhaps the biggest influence of all, as it’s become a domain where instead of traditional means, where users share photos, and videos and follow one another- it’s now a digital marketplace where brands can directly target consumers with digital ads and influencer marketing tactics. 

In the real world, the numbers speak for themselves.

A recent segment by Rest of World covering ByteDance owned TikTok, and the social platforms’ ambition to dominate both eCommerce and social commerce in various parts of the world through TikTok Shop showcases how some users can generate five to ten extra sales after posting live stream videos. 

While the Rest of World segment primarily covers the rapid expansion of social commerce in Southeast Asia, in other parts of the world, such as the United States, United Kingdom, and Canada the same ecosystem is already ripe with opportunity. 

In 2021, TikTok announced that it will be partnering with Shopify in an effort to expand its eCommerce offerings for small businesses and entrepreneurs on the app. The partnership helped TikTok add a “Shopping” tab to the app, enabling users to sell and purchase goods through Shopify. 

The partnership between these two behemoths means that brands and creators are now able to access markets that they previously had no chance of accessing through traditional means of marketing and advertising. 

In April 2021, it was found that Gen Zers made up the majority of TikTok users, around 58%, while Millennials made up 39% of global users. But TikTok isn’t the only place where these two groups of consumers are shopping. 

Other popular social apps such as Meta’s Facebook and Instagram have also recently upgraded their business features to help small and medium-tier businesses sell easier through their platforms. The difference here is when a user purchases a product, the entire transaction remains within the native app, whereas with TikTok, users will be redirected to the businesses’ webshop. 

Hopping from app to app not only allows these consumers to have broader access to a variety of products and brands, but it also means that those brands are now able to market on different platforms, through different mediums, and to different crowds. 

What social commerce means for consumers 

For the modern consumer, social commerce makes up a big part of their time online. Recent statistics found that 44% of Millennials and 50% of Gen Zers report using social media daily. More interestingly enough, 92% of Gen Z’s want to utilize Augmented Reality (AR) tools for shopping according to a report by Snapchat. 

So yes, social commerce is changing, not just from traditional eCommerce platforms, but completely taking hold of digital tools that these sites have to offer. So what does that mean for these consumers?

Quick and Convenient Shopping 

The most noticeable attribute of social commerce is that it’s fast, quick, reliable, and convenient. It’s become an all-access-driven platform, where users can follow the brands they like, and purchase the products that appeal to them the most. 

Around 60% of people have reported saying that they’re more likely to discover new products on Instagram, and roughly 30% reported they're more open to purchasing any type of social media app. 

Social commerce, whether it’s through Facebook, Instagram, TikTok, Snapchat, or YouTube is a growing sensation that;’s captivating audiences. 

Connect with brands more easily 

Perhaps the most intriguing part when it comes to social media and social commerce is that it connects the brand with the consumer. Research by software developers, Sprout Social found that the majority of consumers, around 65% thereof feel more connected with a brand when it has a social presence and activity online. 

Better yet, 70% of consumers are more attracted to a brand when the CEO has a social presence or social media account. And when we look at Millennial and Gen Z consumers, and their usage of social media, their contributions can attribute a majority of online interactions. 

Influencers drive meaningful behavior 

Younger consumers now rely more on people than on physical brand information to help influence their purchase decision. 

Social media influencers have a large and loyal fanbase, secondly, they collaborate with brands that younger consumers feel aligned with, and finally, they speak a more human narrative than traditional marketing tactics. 

Roughly 22% of Gen Z internet users in both the United States and the United Kingdom have made a purchase online after it has been endorsed and inspired by an influencer. Millennials make up 20% of the cut, and Gen X, 16%. It’s clear that younger cohorts are more prevalent in influencer marketing than their older counterparts. 

What social commerce means for business 

We’re well aware of how younger consumers are now changing the face of eCommerce and online shopping, but what do these practices mean for the businesses that can increase their digital footprint. 

More authentic experience 

Social media, while a digital tool that connects us virtually, can become a platform where businesses can establish a more unique and authentic experience with their consumers. 

American menswear brand, Birddogs not only has a quirky brand itself, but its social media presence is more authentic and directed at the consumer base. Birddogs have a dedicated following, both online and commercially, and by speaking directly to their consumers, either through reels, stories, or photos - they are connecting themselves to those who are willing to support them. 

Low cost 

Instead of having to splurge thousands, if not hundreds of thousands of dollars each year on maintaining and operating a webshop, unless required, small and niche businesses can simply make use of social commerce to help drive sales. 

Social media is a free-to-use medium, for everyone, and this means that businesses can leverage this perk to help tap into their target audience without having to dedicate large portions of their marketing budget to improved sales. 

While it’s important to have a dedicated marketing and sales strategy, social media is a simple tool that helps businesses connect with their following easier and quicker. 

A lower percentage of cart abandonment 

Car abandonment is perhaps one of the last things business owners want from a potential client. According to statistics released by Shopify, around 69/57% of online carts are abandoned for various reasons. If you think of it like that, that means that for every 100 shoppers, 70 will end up abandoning their carts. 

This is a major challenge for businesses. And while it’s still possible that consumers can abandon carts on social media, the percentage thereof could perhaps be slightly lower. 

Now that businesses can draw the attention of the consumer, either through video or image, and direct them towards their social store - the business can have a higher chance of completing the sale, than ending up with an abandonment purchase. 

Drives change in how consumers make purchases 

Then finally, social media, as we’ve now seen, can change how consumers, either Millennials or Gen Z's, purchase products and services online. For the most part, we see how social media plays a vital role in the decision-making process. More so, we see how various aspects, from the language being used, to the content that’s being shared can entice users. 

There’s a lot of thought that goes into social commerce, and for businesses looking to make a success from it, it’s perhaps considered to conduct proper research on the target audience, and also, social media content with what younger consumers want to see and interact with. 

To Finish Off 

While social commerce now makes up a majority of online shopping, it’s clear that younger consumers are only going to drive innovative change in the ongoing development of social commerce. 

The digital ecosystem is driven by these two generations, and their desire to interact via social media platforms. 

Businesses may be able to align their marketing strategies with that of their audience, but more importantly, it’s already apparent that younger generations want to support brands that are sociable, active, and drives new trends in the consumer market.