The Future of Shopping: How Social Commerce is Shaping the eCommerce Landscape
From Likes to Checkouts - The Rise of the Social Shopping Experiences.
E-commerce, the online buying and selling of goods and services, has transformed how people shop, with platforms like Shopify, Amazon, Asos, and eBay now central to global commerce. In the UK, retail is the largest growth sector, accounting for significant employment, and is expected to be worth £154 billion by 2027. The online portion of UK retail, currently at 26.7%, is projected to rise to 31.2% by 2028, with some predictions going as high as 50%. A key driver of this growth is social commerce.
Defining Social Commerce
Social commerce blends social media and eCommerce, turning social media platforms into digital marketplaces. It’s not merely about advertising products but engaging users directly, influencing their purchasing through organic and paid content, influencer marketing, and seamless shopping integrations that allow users to purchase without leaving the platform. This integration offers brands direct interaction with consumers, facilitating data collection, social proof, and feedback.
Social commerce -the promotion, selling and buying of products or services via social media includes:
- Social media-driven traffic: Content that redirects users to websites for e-commerce transactions.
- Seamless in-app shopping: Users can browse, purchase, and check out without leaving the social network.
- Customer engagement: Allows brands to engage with their audience, gather feedback and showcase social proof.
- Influencer marketing and product gifting: A powerful way to leverage creators' influence and user feedback.
As digital interactions increasingly define consumer behaviour, social commerce has become essential. By 2026, social commerce will be worth around $2.9 trillion globally.
Driving Factors Behind Social Commerce Growth
With 62.3% of the global population active on social media, averaging 2 hours and 23 minutes per day, social media has become the primary way we receive content and an essential platform for discovering brands. With 78% of users relying on social media for brand information, it tracks that content marketing increases lead generation for 74% of companies.
Key Components of Social Commerce
- Social Media Advertising and Content Marketing
Social media advertising is a primary driver of brand visibility in social commerce, with Meta (Facebook and Instagram) still attracting the largest share of ad spend. Social media ads account for 28.8% of all digital advertising, with global social media ad spending expected to reach $219.8 billion in 2024. Over a third (36%) of businesses allocate between 10% and 29% of their marketing budgets to content marketing. So we can note that this spending level doesn’t yet match consumption trends, This is because many larger companies are still adapting to the shift to socialcommerce. However, smaller brands are “social commerce-native” and have been quicker to adopt these high-growth channels.
Smaller brands with limited budgets are finding innovative ways to use social media effectively. They grow brand reach and customer engagement by sharing behind-the-scenes content, product development updates, and authentic snapshots of the entrepreneurial journey. This transparent approach builds a strong, invested audience who feel connected to the brand on a personal level. Founders are becoming influencers in their own right, sharing their entrepreneurial highs and lows, and attracting dedicated followers who buy into both the brand and the person behind it. This authenticity builds community and de-risks product launches. By regularly engaging with their audiences, these founders gather valuable feedback on product designs, formulations, and branding. With this insight, they can refine products before launch and even build waiting lists, which helps them leverage demand in negotiations with manufacturers, often securing better deals.
This approach underscores how social commerce isn’t just a sales tool but a method for building genuine, long-term connections with your customers. By fostering a social community, these brands are creating loyalty and credibility, all within the social platforms that their target consumers already use daily. Jumping on trending topics or sounds and creating viral content has taken brands that previously fulfilled single-digit orders per day to being sold out within hours especially when amplified by user-generated content (UGC) or endorsements from influencers and micro-influencer
- In-Platform Shops and Checkouts
Platforms like TikTok Shop and Facebook Shops now offer fully integrated shopping experiences. TikTok Shop, launched in the UK in 2021, allows businesses to sell directly within the app. TikTok also partnered with Shopify to streamline the setup for UK merchants, enabling catalogue sync, in-feed video ads, and live broadcasts that offer a seamless shopping experience for users.TikTok’s reputation initially attracted low-cost and fast-fashion items, with an average order value of around £25, but brands across are increasingly recognising its potential. The native shopping experience does need some work, its search for example isn’t up to par, but as TikTok invests in platform improvements, more brands are exploring it as a viable sales channel. Meta previously closed their Shop tab for Instagram which left the space for TikTok to position itself into the growth of Social Commerce.
- Live Shopping
Live shopping, popularised in Asia and bolstered in the West during the pandemic, is projected to reach £5 billion in the UK by 2025. It enables brands to recreate personal shopping experiences on social media, often using formats similar to traditional QVC-style shows but with added flexibility. Livestreams can feature behind-the-scenes tours, tutorials, and interviews, all of which deepen the consumer’s connection to the brand and its story.
The U.S. live shopping market is also expected to expand significantly, projected to grow from $31.7 billion in 2023 to $67.8 billion in 2026. This rapid growth illustrates the powerful appeal of live, interactive product showcases. Amazon, TikTok, Walmart and Meta support or run live shopping. The Founder Winnie of LVS Hub a full-service live stream and video commerce agency recently shared some interesting insights that 44% of men-targeted livestreaming actually performs better than women-targeted ones. Top categories that perform well in general include fashion, beauty and personal care.
- Scaled Word-of-mouth
While influencers continue to play an important role in brand visibility, many consumers now favour recommendations from people they personally know over endorsements from online personalities. Friends and family have become powerful drivers of purchasing decisions, as consumers increasingly value familiar, relatable perspectives over celebrity promotion. This trend underscores a shift toward scaled word of mouth, where everyday social connections drive brand inspiration, trust, and ultimately, sales.
Social media makes this scaled word of mouth possible by facilitating effortless sharing of personal recommendations and user-generated content. Instead of solely relying on influencer reach, brands are leveraging real customer experiences and peer recommendations to build trust and authenticity. This approach taps into organic, genuine enthusiasm for products, helping brands establish credibility and fostering lasting customer relationships. For eCommerce brands, understanding this consumer shift is essential, as it represents an opportunity to create marketing strategies that prioritise relatability and trust, driving long-term growth. As one marketing leader, we spoke to suggested, brands should view gifting as part of their cost of goods sold (COGS), strategically placing products in the hands of real users who can share honest reviews. For eCommerce finance teams, this model can offer a stronger return on investment (ROI) by reducing customer acquisition costs (CAC) and building a more loyal customer base with repeat purchase potential
- Social Media's Influence on In-Store Sales
Social media is not only driving online sales; it also influences 80% of offline purchases by raising brand awareness and directing foot traffic to physical stores, pop-up events, and marketplaces. These “digitally influenced” IRL purchases extend the impact of social commerce beyond digital boundaries, bringing shoppers to real-world locations.
Key Platforms Driving Social Commerce
- TikTok
TikTok, the fastest-growing social platform, is on track to reach 48.8 million U.S. users by 2025, surpassing Instagram’s 48.2 million users despite Instagram’s being six years its predecessor. While TikTok initially built its user base as an entertainment app, it’s increasingly becoming the preferred platform for search and discovery among younger users. Some 43% of Gen Z start product searches on TikTok, ahead of traditional search engines & marketplaces like Google or Amazon.A recent report by Oxford Economics, titled "The TikTok Effect" outlines TikTok's economic impact on small and medium enterprises (SMEs) in Europe. In 2023, TikTok contributed an additional €4.8 billion to the GDP across Germany, France, Italy, the Netherlands, and Belgium, supporting more than 51,000 jobs. SMEs on TikTok are also highly diverse, with nearly three times as many owners from diverse backgrounds and a younger demographic profile (under 30). However, despite TikTok’s rapid growth, many businesses, especially smaller brands, continue to allocate more of their advertising budget to Meta platforms. This is largely due to familiarity with Facebook and Instagram’s ad metrics, which provide clearer more established ROI tracking than TikTok. We have heard from brands who say they just don't find paid content to perform well on TikTok whereas organic content does. The challenge with ad content on TikTok is that it needs to blend seamlessly with entertainment content to avoid disrupting the user experience. Tikotok is offering support but for brands with significant ad spend budgets. As TikTok’s ad tools evolve, brands may gradually shift more spending towards it, but for now, Meta remains the preferred choice for most brands seeking measurable returns.
Facebook continues to dominate social commerce, with 89% of marketers using it for retail sales. A third of social commerce buyers in the U.S. reported that their most recent social purchase was on Facebook, which offers a well-established platform with features like Marketplace and Shops. Facebook’s integration with Shopify further simplifies catalogue syncing and shoppable posts, creating a cohesive shopping experience that mimics an online storefront.
Instagram is used by approximately 26% of the global population aged 13 and older, with 70% of users actively seeking shopping inspiration on the platform. It is an ideal platform for showcasing a brand’s aesthetic and experience. Brands often use Instagram to create a curated, visually appealing presence, leaving more candid, behind-the-scenes content for TikTok. This blend of platforms allows brands to balance aspirational content on Instagram with relatable engagement on TikTok.
Pinterest combines visual discovery with social engagement, functioning as a search engine for images and product ideas. With 465 million monthly users, Pinterest allows brands to reach users early in the discovery phase when they’re exploring options without a particular brand in mind—97% of searches on Pinterest are unbranded. Pinterest’s user base includes a significant portion of high-income users, making it an ideal platform for brands targeting customers with disposable income. Note that 85% of weekly users have made a purchase based on a pin they saw from a brand. By using shoppable pins and the Shop tab, brands on Pinterest can reach new customers who might not be familiar with their offerings, turning passive browsing into active shopping.
- Snapchat
Snapchat provides a unique social commerce experience by combining interactive, and the component of scaled word-of-mouth or peer-influenced content with immersive shopping tools. According to Snapchat, their users are particularly receptive to social ads, with 85% discovering new products through them compared to just 68% of non-Snapchat users. Furthermore, these users are highly influenced by personal connections: Snapchat users are 1.5 times more likely to trust recommendations from friends and family over influencers, making them a valuable network for brands seeking to build trust-based relationships with customers. This inclination towards trusted, peer-driven recommendations is something we have seen with growing brands.
Snapchat’s Augmented Reality (AR) shopping tools add an additional layer of engagement, allowing users to virtually interact with products in real time. For example, AR shopping lenses enable users to visualise how sunglasses or shoes might look on them, or how furniture would fit in their space, bridging the gap between digital browsing and physical try-ons. Snapchat has made this AR experience accessible with tools like the Lens Web Builder, a no-code solution that allows brands to develop interactive AR lenses without needing advanced technical skills. With 90% of Snap users saying their personal style is key to self-expression, and Snapchat users being 70% more likely to trust apparel, speciality goods, and beauty brands than their non-Snapchat counterparts (29-30% vs. 17%), Snapchat's AR is a key trend within Social commerce
Summary
Social commerce has reshaped e-commerce by combining social interaction with streamlined shopping experiences, providing brands with new avenues to engage consumers and drive revenue. For eCommerce businesses using platforms like Shopify, understanding this shift is critical. As social commerce expands across platforms like TikTok, Instagram, and Facebook, businesses have unprecedented opportunities to reach customers directly where they spend time, influencing both online and offline purchases. However, navigating this new landscape effectively requires strategic allocation of resources and a keen eye on Key Performance Indicators or metrics (KPIs).
For eCommerce brands, success in social commerce hinges on using insights to drive cost efficiency and revenue growth. This is where CloudFO the AI finance colleague and solution tailored for Shopify merchants, becomes invaluable. CloudFO helps brands set clear financial goals and leverage AI to track the ROI of social commerce investments, optimise ad spend, and manage the budgets necessary for expanding their social presence. From maximising performance on established platforms like Meta to exploring the ROI potential of TikTok, CloudFO empowers brands to make data-driven decisions that support their bottom line.
By aligning financial metrics with strategic social commerce goals, CloudFO ensures that eCommerce brands can effectively reduce costs, increase revenue, and maximise growth in the dynamic digital marketplace.
In Part 2, we’ll dive into mobile commerce (m-commerce), exploring the trends, tools, and insights shaping mobile purchasing and engagement. We'll also discuss the implications for brands navigating a mobile-first user experience and its connection to social commerce.