YouTube is moving in on the action and plans to invest in the growing social commerce market. The video platform, part of the Alpha Group, is already testing an affiliate marketing program and has a project called "From YouTube to You" to help influencers and brands sell products, while the introduction of these social commerce features should serve to diversify revenue streams.
According to a Financial Times interview with the general manager of YouTube Shopping Michael Martin, YouTube plans to deepen its investment in shopping programs to capture the growing social selling market. The platform is already testing an affiliate marketing program with some U.S. creators in which it pays them a commission for selling products. This program benefits YouTube, creators and brands, as all three share a portion of the revenue. YouTube has also introduced its “From YouTube to You” project by offering popular influencers curated gift suggestions, exclusive product introductions and deals in a series of videos, live streams and shorts.
In 2023, YouTube plans to pay creators 45% of the revenue generated by inserting ads between shorts in the U.S., India, Brazil, Canada and Australia. The company aims to focus on the best monetization opportunities for creators in the market and (strongly) differentiate them from other platforms where appropriate. This investment in social commerce is part of a broader trend of tech companies, including Amazon and Meta, that are trying to combine social media and shopping. As TikTok most recently unveiled its eCommerce program in the US.
Find an example of an influencer marketing campaign using social commerce on the Influencer Marketing Blog by Kolsquare.
Social commerce is the use of social media platforms to sell and promote products and services. It is about integrating e-commerce with social media feeds and interactions to create a seamless shopping experience for consumers.
YouTube, as a popular social media platform, plays an important role in social commerce. For the video platform, social commerce is mainly a marketing and advertising tool where influencers or creators promote products and services in sponsored videos or product reviews. Integrated e-commerce on YouTube, aka social commerce, manifests itself in the form of direct shopping features such as clickable product links and shoppable ads that allow viewers to buy products directly from the videos.
The expansion of social commerce features on YouTube is the company’s response to the weakening economy and the weak digital advertising market to diversify revenue streams. YouTube plans to launch two pilot shopping programs in 2023, including the previously mentioned “affiliate marketing” program, in which creators who sell products will receive a commission and the”Shoppable Shorts” feature available in the U.S., India, Brazil, Canada and Australia.
Success in the social commerce market usually depends on the relationship between influencers and their followers. YouTube focuses on Generation Z users who prefer “video-based interactions without a doubt” and has more than 1.5bn monthly users on its Shorts channel, surpassing the one billion users on TikTok. While YouTube has tested live shopping, the platform has so far focused on markets where it has become popular, such as South Korea.
Brands can benefit from social commerce by creating “shoppable” galleries, tagging products in posts and incorporating influencer marketing with user-generated content (UGC). Influencer marketing brings your brand to an engaged community that is interested in your products, thanks to the influencers’ recommendations. If they can buy your products directly with just a few clicks, you increase your sales chances enormously.
Kolsquare tip: Successful brands leverage the value of their influencer content outside of social media and integrate it into other marketing channels such as emails and website ads.
In general, influencer marketing is the key driver of social commerce. For example, Pixlee TurnTo’s 2022 Influencer Trend Report found that 80% of influencers regularly use products from brands they have partnered with.
Social commerce on YouTube and influencer marketing have become important strategies for brands to reach their target audience and encourage interaction with products. As consumers are turning to social media more than ever for product recommendations and inspiration, thus, brands must adapt to meet their customers’ needs. In this context, the following examples show the importance of leveraging user-generated content, giveaways, video marketing, customer feedback, social proof and experience-based content to drive sales and brand awareness on social media platforms like YouTube.
CLUSE is a jewelry and watchs brand that has successfully transformed its social media feed into a digital storefront. The brand’s social media presence is like a well-oiled machine that drives sales, with hashtags and links that directly lead followers to the store. The brand has leveraged social shopping with great success, and companies can learn from their experience, including using user-generated content to create a more personalized and engaging shopping experience.
Sinless Beauty harnessed the power of giveaways to drive engagement and visibility. By launching a giveaway, they encouraged their followers to share content and tag the brand. At the same time, they were able to test which hashtags were most relevant to their target audience. Giveaways are a great way for brands to engage their followers and drive traffic to their social media pages.
Burberry is a luxury brand that has been attracting the attention of users and consumers lately, especially through artistic, creative and visually stunning videos.
For brands in the luxury sector, it is more difficult to get interested parties to buy high-priced products directly via social networks. Potential Burberry customers expect a different buying experience, so you evidently need to understand your target audience carefully. In conclusion, social commerce is a promising opportunity, but it’s not suitable for every marketing strategy.
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