Are digital commerce leaders ready for a social future, or a fall?
A few years ago, if you'd told commerce leaders that the future of retail would be in social media, you would've been met with disbelief and probably a bit of dismay.
How much difference just a few years can make!
Today, commerce leaders are not only aware of this social future, they appear to be embracing it. And it isn't hard to understand why - 70% of commerce leaders agree that today's generation of children will be difficult to market to.
So, commerce leaders seem to have concluded that their best chance at winning with these future customers is to align themselves with their interests.
But are commerce leaders' organisations really prepared for this social led future, and all the change that entails? Or has their natural overabundance of confidence skewed their perspectives?
To find out, we surveyed more than 500 commerce leaders across the UK and US for our latest report, "Ready or Not? The Digital Commerce Leader".
In this article, I'll examine whether commerce leaders really have figured out how to market to this prized demographic, and if they've finally learned to embrace influencers.
And, what commerce leaders' own social habits can tell us about them.
Social paradigm shift
There's no shying away from the act that we now live in a disruptive world. And that disruption is almost personified by the evolving tastes, habits and expectations of younger generations of customers. Retail giants such as Amazon and Alibaba have fundamentally changed societies' mentality when it comes to eCommerce.
Similarly, other factors such as climate change and corporate social responsibility have grown as a priority for younger shoppers.
Collectively, these factors have significantly altered the landscape for retailers - and the rise of social has only complicated it further.
When surveyed, almost a quarter of both commerce leaders (24%) and children (25%) agreed that when it came to marketing wares, social media influencers have taken the crown. This hints to a very positive alignment between these two groups.
However, whilst encouraging, it's important to dig deeper to understand if commerce leaders are truly prepared for the realities of a social future.
Ready, set, social!
A big part of being a commerce leader is future-gazing.
One half of this equation is predicting what customers of the future will want. The other half, however, involves practically putting plans in place to steer the organisation towards said predicted future.
And, according to our survey, commerce leaders have been incredibly proficient - a large majority (70%) claimed to already have a social commerce strategy in place.
This impressive figure suggests that commerce leaders are actively driving necessary changes in their organisations. And, positively, it may also indicate that our leaders are willing to learn from previous failings. Indeed, our new survey uncovered that - by their own admission - an alarming 54% of all digital commerce projects fail.
Taking a closer look, it's helpful to consider one specific aspect of social commerce that underpins a lot of this speculation...
Influencers - a complicated relationship
Social commerce and influencers are inextricably linked, and their importance really can't be overstated.
Currently, almost a fifth (19%) of commerce leaders believe brand sites are their most important channel today. But by 2029, that same percentage expert social to be the dominant retail channel.
So, it's no surprise that more than two thirds (68%) of commerce leaders believe influencers will be a key part of their marketing mix.
In an increasingly segmented and personalised world, influencers have become unmatched when it comes to impacting young shoppers' buying habits.
More than half (55%) of 6-16-year olds say they would want to buy an item if they saw their favourite YouTube of Instagram star wearing it.
Today, two thirds (66%) of organisations we surveyed stated that they currently work with social media influencers.
But what about the reputation commerce leaders have of their distrust of influencers?
Well, on one hand, it seems like that has begun to wane - most (71%) commerce leaders said influencers have had a significant impact on their brand awareness.
However, once you begin to delve into specific knowledge commerce leaders have around the influencer market, you start to see some cracks.
For example, Kim Kardashian was viewed as the most important influencer by both leaders and children alike. However, while only 40% of leaders agreed with this, 60% of children said the same. And there was a similar discrepancy between the two groups when it came to Kylie Jenner (35% of leaders to 49% of children).
And personalities like Greta Thunberg, who's viewed as highly influential by almost a quarter of commerce leaders, barely registered with younger audiences, only garnering 6% of their attention.
So, while they may be willing to accept this new paradigm shift, commerce leaders still have a way to go before they can be considered as 'down with the kids'.
Begrudging social progress
Commerce leaders understand the importance of social and influencers to the future of their organisations.
But old habits die hard.
Because, despite the undeniable benefits to their organisations, 57% of commerce leaders admit to still personally harbouring negative sentiments towards influencers.
However, commerce leaders are clearly trying to push their way past these feelings. There's a willingness to be open-minded - demonstrated in who they claim inspires their purchase decisions.
Leaders put friends first (17%), influencers second (16%) and celebrities third (15%).
Even the children we surveyed put their families above celebrities. This may illustrate how commerce leaders view their tastes and influences - just another extension of their role.
Whichever way you cut it, the consensus is clear: social commerce is going to be instrumental to the future of retail.
And while commerce leaders may not be where they need to be today, if they carry on investing in the right strategies and working with the right influencers, they soon might be.
Want to explore this further?
A note about our new report
This article is based on findings from our new report "Ready or Not? The Digital Commerce Leader". Research for this report was conducted by independent research consultancy Censuswide. A total of 503 senior decision-makers (including c-suites) in digital commerce were interviewed in October 2019; 252 in the UK and 251 in the US.