Pros and cons for companies


If you’ve been on Instagram for the past year, you’ve probably noticed the shopping bag icon at the bottom of the screen. This is a form of social commerce, where consumers can buy items directly from a brand without having to leave the app, from browsing to logging out.

Simply put, social commerce is the act of selling physical products through social media (think Instagram Shopping or Facebook Shops).

On the other hand, e-commerce is basically a general term to outline all forms of online purchase of physical products. In this piece, we will use the term to describe purchases through third party sites such as Lazada and Shopee.

Are there any that are better than the other for an SME or a micro-brand? Let’s take a look at some of the features users should expect from the online shopping experience and see how social commerce and e-commerce work.

Instant ad transactions

As mentioned, social commerce means that the entire shopping experience, from browsing to exit, takes place on social media and consumers will not have to leave the platform at all.

From browsing to payment, everything is done in the same social app

For brands, products can be taken out in a more fluid way, as customers will not be redirected to different sites. To add, they won’t have to create new accounts just to make a purchase, which can lead them to abandon their carts.

So whenever they see an ad on their social media channel, they can just click on it, fill in the submission data, and make a boom; this article will be on its way.

However, if you’ve ever clicked on your Lazada or Shopee recommendations on Facebook, you’re probably familiar with the annoying upload times needed just to see this product on the site. Most often, you don’t get to the brand page, but to the home page.

Although, if you’re already browsing third-party e-commerce sites, it’s no surprise that transactions are also perfect and instantaneous, but people tend to spend more time on social media than these sites.


Social trade 1
E-commerce 0

Keep customers up to date

Since social commerce is done through social media, customers have a direct way to connect with brands and keep up to date with new product launches, promotions and the like.

Also, if you have any questions about the products, questions can be clarified directly from the source with a comment or DM, which are usually seen and answered more quickly. This can make customers press this purchase button more safely without having to sleep on it first.

On the other hand, brands cannot really rely on third-party e-commerce sites to let their customers know that there has been a new product launch or a discount on certain items.

Customers will only find out if they are already actively looking for such a product, which means that the visibility of your brand’s activity is much lower overall, leading to slower traction and conversions.


Social trade 2
E-commerce 0

High reach and commitment

Word of mouth is powerful. If you’ve read most of our startup features, you’ll notice a common trend. Most started with just a handful of fan-cum-customers who shared their compliments about a brand and eventually also turned their own friends into customers.

With social commerce, consumers can post photos or videos in the form of posts and stories. When they tag the brand they bought, their followers will see it and have access to explore and research your brand profile, which can turn into sales.

Brands also have a clearer idea of ​​who their audiences are, as customer data on social media is available through site analytics. Therefore, brands can modify their ads to target specific customers or run split tests to find out what types of messages generate better sales.

For e-commerce sites, in the reviews section, you would mostly see people complaining (or complaining) about a product, but the people who would see these messages are just other customers who are already looking at the product.

Of course, if someone likes the product enough, they would do the same on social media, but if you’re a smaller or newer brand that doesn’t make your social media easily known, it’s rare for users to work on it. find yourself and tag yourself.


Social trade 3
E-commerce 0

Usability of search functions

Unless a user is able to identify the exact brand manager or user tag for their products on social media, it’s a hassle for customers to find the exact product they’re looking for. It is a feeling shared by the founder of Poptron, also an e-commerce site for microbrands.

Ecommerce sites have useful search engines, as it is a rule for marketers to name their articles with all possible keywords that apply to a product. Would I find the exact “Samsung S10e hard phone case” I need at Shopee? Yes, and I can also discover something else I didn’t know I needed to reduce the cost of shipping, such as a wireless charger that is now heading to me from China.

If I tried to enter the same keywords in Instagram stores, I would get a “No results found” message. But if I simply searched with “phone case” as keywords, I would be suggested some brands, where I would have to browse through each of them just to find the product I have in mind.

For a demanding and impatient buyer like me, the discovery of the latter is infuriating, which earns e-commerce a point in this category.


Social trade 3
E-commerce 1

Transparency of customer satisfaction

Vanity metrics are numbers that look spectacular on the surface (such as follower count and percentage of interaction), but that don’t necessarily translate into significant business results (sales).

When you trust social commerce, you may quickly get excited about the likes and comments you’ve received. However, these figures may not turn into successful sales, even if you have promoted your products through paid ads or if you have posted a post that has gone viral.

People don’t usually leave very useful comments (out of love or aversion to a product) on a brand’s social media, and it’s usually quite difficult to know which of the reviews is a real customer or just a fan of the products. nice brand.

For e-commerce, if a product listing has a high score and a large sales volume, it is an immediate sign that customers who have bought it love it. Other people are also more likely to buy your brand.


Social trade 3
E-commerce 2

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Perhaps the biggest advantage for social commerce is that it brings the entire online shopping experience to spaces where people are already hooked. On average, people from all over the world already spend more than two hours a day on social media and you can bet that some people spend even more time on it.

This means easier access for many potential customers and brands should start to at least have a knowledge of how to use these social marketing tools before they are left behind. As mentioned, e-commerce websites (whether brand-owned or third-party) still have the benefits of a better search feature, but over time we won’t be surprised if social media sites too adopt this function.

But that doesn’t mean third-party e-commerce sites have the job cut. As we explain, they still offer new and growing brands many advantages here.

In any case, the entire buying process on Instagram is only available in the US and not in Malaysia. Throughout my own Instagram Shopping strip, it looks like I have yet to see the product on the brand’s actual website and make my purchase there.

So for now, if you don’t think it’s worth setting up your micro-brand on third-party e-commerce sites transaction fees, you could first use the classic “Custom DM” and grow your social media user base in preparation.

  • You can read more online shopping articles we’ve written here.

Featured Image Credit: Vulcan Post

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