Daily news, E-Commerce, Mobile payments, Mobile Wallet, P2P, social commerce -

UK social commerce set to double in the next six months

UK social commerce (selling on social media platforms) is set to double over the next 6 months. That’s one of the findings from PayPal’s fourth annual Commerce Index.

The new research also found that security remains a concern for the UK’s online consumers and that UK businesses may be missing out on the international opportunity. Let’s look at those in turn.

The social commerce opportunity

Almost one in four (24%) British businesses already allows customers to make transactions through their social media channels. That’s set to double over the next six months as mobile shopping extends into social channels. The stronger customer connection that businesses can build on social channels appears to be valuable. Those that already sell on social say that 38% of their sales volume comes via social media.

That’s a big number, but it compares with a global average of 45% of sales volume. UK sellers and buyers are clearly playing catch-up on social commerce. And, that means a huge opportunity for UK businesses to get ahead of the game.

Currently 8.4 million British consumers shop via social media, with Facebook, Instagram and Snapchat being the most popular channels. A fifth of those already purchasing through social do so weekly, with individual social spending averaging £71 monthly.

PayPal annual Commerce Index

Who’s buying what on social media?

Social commerce is growing within all age groups but, as you’d expect, it’s the younger demographic that’s leading the way. Almost one in four (24%) Millennials and just over one in five (22%) Gen Z-ers have purchased or paid using social media in the last six months. That compares with one in six (17%) from Gen X and one in nine (11%) Baby-boomers.

Perhaps unsurprisingly, the top categories for social commerce are Clothing & Accessories (15%) and Health & Beauty (10%). Other popular categories include Home & Garden (8%), Books & Magazines (7%), Food & Drink (6%) and physical Toys & Games (6%).

Security stays top of mind

The Commerce Index also found that security and trust remain a concern for UK online shoppers. They are also the top priorities for UK online businesses. “Ensuring the privacy of customer data” ranked as the top priority for business (at 34%). “Ensuring the security of ourIT/technology system” came a close second (33%).

For shoppers, the convenience of using a mobile device wins out with almost three quarters (73%) of consumers using mobile devices for purchases and payments. Nearly half (48%) use their mobile at least weekly for purchases and payments.

Security or trust issues remain a potential barrier, however, cited by nearly two-thirds (64%) of shoppers. That’s the highest level of all the 11 markets surveyed. One in four (26%) UK shoppers have abandoned a transaction on mobile because of security concerns.

As social commerce grows in popularity, there will be an increasingly a close eye kept on the data collected during the social shopping experience and its potential implications. No surprise then that this is reflected in the Commerce Index research:

  • 39% say “I don’t trust the process of buying on social media platforms”
  • 38% say “I don’t want my financial information linked to my social media”
  • 37% say “I am worried about safety / security of my personal information on social media.”

To capture the social commerce opportunity, businesses will need to pay special attention to these concerns by providing processes and payment methods that are trusted and secure.

Don’t miss the cross-border opportunity

The Commerce Index research also suggests that the UK’s online businesses may be missing out on cross-border sales. While one in three UK businesses have made international sales in the past six months, only 10% of businesses say that they actively target international buyers.

But global online shoppers increasingly enjoy cross-border shopping. Our research suggests that more than half (55%) of consumers shop across borders on a regular basis.

The top reasons for shopping on international sites are:

  • Access to items not available in their home market (50%)
  • Better prices (46%)
  • To discover new and interesting products (28%).

Add to that the fact that British brands are often highly valued by overseas shoppers and the research suggests a large and untapped opportunity for the UK’s online sellers. In the research, 17% of business respondents said ‘selling to international customers has helped our business grow’.

“The UK falls some way behind the global average for selling via social, something which must be addressed if businesses are to compete and make the most of their selling potential,” says Nicola Longfield, Senior Director of Small and Medium Businesses at PayPal UK.

“Security remains key for consumers shopping on social and companies of all sizes must address these fears, offering mobile-friendly payment options like PayPal to help instil trust from shoppers and ensure purchases are made securely.”

The post UK social commerce set to double in the next six months appeared first on Payments Cards & Mobile.