Social Commerce Market 2023: Statistics, Global Size, Analysis, and Forecast

Market Overview:

The global social commerce market size reached US$ 778 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 3,652 Billion by 2028, exhibiting a growth rate (CAGR) of 27.9% during 2023-2028. Rising levels of consumer interaction on social media, the widespread accessibility of high-speed internet connections, the surge in smartphone and tablet usage, along with the growing preference for online shopping are the primary factors propelling the market.

Social commerce refers to the combination of e-commerce and social media platforms, facilitating online buying and selling operations directly within social media networks. It provides businesses an opportunity to interact, engage, and transact with customers directly through social media platforms, such as Facebook, Instagram, and Pinterest, among others. It simplifies the shopping process by allowing consumers to purchase products or services without leaving the social media site or app, thereby enhancing the user experience. This system leverages the power of social interactions and user-generated content to increase sales, capitalizing on product recommendations, reviews, and social influence. Nowadays, social commerce is becoming an increasingly integral part of business strategy and driving multi-channel retailing.

Some of the factors driving the growth of the market include the integration of the latest technology and the rise of personalized shopping experiences. The utilization of technologies like artificial intelligence (AI) and augmented reality (AR) are proving crucial in enhancing the user experience. For example, AI helps in analyzing consumer behavior and preferences to offer personalized product recommendations, while AR solutions enable virtual 'try-ons', creating an immersive shopping experience. Furthermore, the unique personalization capabilities of social media platforms allow businesses to cater to individual consumer needs and preferences, thereby significantly improving customer engagement and conversion rates.

Social Commerce Market Trends/Drivers:

Rise of Social Media Usage

The rapid proliferation of social media websites globally has provided an unprecedented platform for businesses to interact with consumers. The number of social media users worldwide has reached billions, with the average user spending a significant portion of their daily time online on these platforms. This wide-reaching, constant accessibility allows businesses to directly market to consumers, presenting products and services in a more relaxed and non-intrusive manner. Moreover, these platforms also serve as an avenue for consumers to share their purchase experiences, acting as a form of social proof that can persuade potential customers.

Advancements in Mobile Technology

The past decade has seen significant advancements in mobile technology, with smartphones becoming a vital part of daily lives. Enhanced smartphone capabilities and internet connectivity have led to increased mobile commerce, with users often choosing to shop directly from their devices. Mobile shopping offers improved convenience as consumers can shop from anywhere at any time. As most social media platforms are primarily accessed via mobile devices, businesses are optimizing their strategies for mobile users. They are designing seamless and easy-to-use shopping interfaces, which, in turn, is driving the market.

Expanding Influencer Marketing

Recently, influencers have emerged as a crucial force in shaping consumer behavior. These individuals are able to influence the purchasing decisions of their followers through their content, recommendations, and product endorsements. Companies are leveraging this trend in their strategies, collaborating with influencers to promote their products or services. Influencer marketing often provides a higher return on investment compared to traditional marketing strategies due to the personal connection influencers have with their followers. This form of peer-to-peer marketing feels less like advertising and more like advice, leading to higher engagement and conversion rates, thus significantly driving the market.

Social Commerce Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global social commerce market report, along with forecasts at the global, regional, and country levels from 2023-2028. Our report has categorized the market based on business model, device type, and product type.

Breakup by Business Model:

• Business to Consumer (B2C)
• Business to Business (B2B)
• Consumer to Consumer (C2C)
   

Business to Consumer (B2C) represents the most widely used business model

The report has provided a detailed breakup and analysis of the market based on the business model. This includes business to consumer (B2C), business to business (B2B), and consumer to consumer (C2C). According to the report, B2C represented the largest segment.

The B2C model is the leading business model in the market due to the direct nature of transactions between businesses and end users. In the B2C model, companies sell products and services directly to consumers, usually in a single step buying process. This is an ideal match for social media platforms, which are predominantly consumer oriented. Social media platforms offer businesses an opportunity to directly target consumers, engage with them, and understand their preferences. The ability to provide personalized shopping experiences and customer engagement on social media platforms drives higher conversion rates and increases customer retention.

Breakup by Device Type:

• Laptops and PCs
• Mobiles
• Others
   

Mobiles account for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the device type. This includes laptops and PCs, mobiles, and others. According to the report, mobiles represented the largest segment.

Mobile phones dominate the market, driven by their wide availability. The convenience offered by mobile shopping aligns with the flexibility of 'on-the-go' shopping. As social media platforms are predominantly accessed via mobile devices, their design optimizes navigation, product browsing, and direct purchases. Moreover, enhanced mobile technology has bolstered security for online transactions, which, along with the simplification of the checkout process through mobile wallets and secure gateways, promotes consumer confidence and facilitates a seamless shopping experience.

Breakup by Product Type:

• Personal and Beauty Care
• Apparel
• Accessories
• Home Products
• Health Supplements
• Food and Beverages
• Others
   

Apparel dominates the market based on product type

The report has provided a detailed breakup and analysis of the market based on the product type. This includes personal and beauty care, apparel, accessories, home products, health supplements, food and beverages, and others. According to the report, apparel represented the largest segment.

As fashion is a visually driven industry, it has emerged as a perfect fit for the image and video-centric nature of popular social media platforms. High-quality images and videos of apparel items can effectively capture user attention and generate engagement. Moreover, the rise of influencer marketing has significantly impacted the apparel sector. Fashion influencers command significant followings on social media, and their endorsements can lead to considerable sales for apparel brands. Furthermore, technologies such as AR are being increasingly used to provide virtual fitting rooms, allowing consumers to virtually 'try-on' clothes before making a purchase, thereby enhancing the online shopping experience.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia-Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

Asia Pacific exhibits a clear dominance, accounting for the largest social commerce market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa.

Asia Pacific leads the market due to its vast user base and high rate of social media penetration. The region boasts a sizable youthful population who are digital natives and have adopted social media and online shopping trends. Additionally, the proliferation of affordable smartphones and improved internet connectivity, particularly in emerging economies like India and China, has propelled the reach of social commerce. Local businesses and global organizations are leveraging these platforms to engage with consumers. Furthermore, the strong influence of KOLs (Key Opinion Leaders) or influencers in these markets amplifies product reach and acceptance, thereby accelerating the market growth.

Competitive Landscape:

Major companies in the market are partnering with social media influencers for product promotions and endorsements. They are also focusing on providing a personalized shopping experience to their customers by employing advanced technologies like AI for tailored product recommendations. Additionally, businesses are optimizing their platforms for mobile shopping, given the prominence of smartphones in the segment. They are also investing in secure and varied payment options to provide convenience and build customer trust. Another prevalent strategy is active engagement with consumers through social media channels for customer feedback, queries, and resolution. These strategies are helping companies in the market improve their customer reach, engagement, and conversion rates.

The report has provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:

• eBay
• Etsy Inc.
• Facebook
• Meesho Inc.
• PayPal Payments Private Limited
• Pinterest Inc.
• Poshmark Inc.
• Reddit Inc.
• Taobao (Alibaba Group Holding Limited)
• Twitter Inc.
• Verizon Communications Inc.

Recent Developments:

• In April 2023, eBay added a social sharing integration on their Seller Hub. This feature allows eBay sellers to link their social media accounts to their Shops from the Seller Hub, making it easy for them to share listings on Facebook, Instagram, Twitter, and Pinterest?.
• In May 2020, Facebook launched Facebook Shops, a platform that allows businesses to set up online stores on both Facebook and Instagram, making it easier for small businesses to connect with customers and sell their products.
• In April 2023, Pinterest announced that it will be opening up third-party ad demand on its platform. The first partner for these ads will be Amazon, allowing more brands and relevant products to reach Pinterest users. The partnership aims to provide a seamless buying experience for consumers and strong performance for advertisers.

Social Commerce Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the social commerce market from 2017-2028.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global social commerce market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the social commerce industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.