How does social commerce/influencer marketing affect manufacturing?

70% of consumers start their buyer’s journey on social media. 

92% of consumers trust online influencers more than traditional forms of advertisement or celebrities. 

These stats are a clear indicator that the way modern consumers shop has changed. Social media has fundamentally shifted the marketing landscape and the buyer’s journey. This cultural and behavioural shift presents a great opportunity for firms to expand their market and grow – that is, when it’s done right.

However, manufacturing companies often overlook social media when it comes to their marketing and growth strategy. This can be a costly mistake.

Traditionally, there are many layers between manufacturers and customers. The concept of social commerce has the potential to disrupt that.

The growing trend of social commerce and influencer marketing

Social commerce is the use of social media platforms for selling products directly to customers – encompassing the whole marketing and sales process, from promotion to after-sales services.

The growing trend of social commerce has been accompanied with the emergence of new platforms that gather brands, manufacturers, customers, and influencers all in one place. At the same time, it has pushed the established social media platforms like Facebook, Instagram, TikTok and WeChat to incorporate shoppable features directly into their environment.

Influencer marketing, in turn, is a type of social media marketing that brands use to promote their products using endorsements and mentions from online thought leaders and content creators (a.k.a. influencers). Influencers have their own loyal following and are considered experts in their niche.

The rise of influencer marketing is further driving social commerce as brands are leveraging the two to increase brand awareness and ultimately sales. The collaboration of brands with influencers is going as far as to include them all the way from the product design to the sales process.

In the social commerce ecosystem, China is the biggest market in the world, with $351.65 billion in sales in 2021.

According to the eMarketer Insider Intelligence report, China is paving the way in social commerce, relying heavily on influencers to drive engagement and sales.

The influencer-driven culture in China has seen the rise of new sales model, with livestream shopping being the most predominant one.

While still in its infancy in the rest of the world, Livestreaming was forecasted to generate over 131.52 billion in sales in China in 2021 according the eMarketer report. Livestreaming provides an interactive shopping experience as customers can see live product demonstrations, ask product questions to influencers, and make purchases in real time. All from within one platform.  

Lessons from China: The benefits of social commerce/influencer marketing for manufacturing companies

1. Increased sales

According to the Statista Research Department, in 2020, over 3.6 billion people were active on social media. This number is predicted to increase to over 4.41 billion in 2025. That’s over half of the world’s population. While not everyone on social media will be your target audience, it undoubtably exposes you to potential new customers every day.

Another report published on Statista shows that social commerce generated about 474.8 billion US dollars in revenue in 2020, which is expected to grow with 28.4 percent by 2028. 

Thus, social commerce puts your brand in front of more potential customers and gives them the opportunity to purchase directly within the social media platform. In other words, social commerce increases your exposure and makes it easier for customers to buy from you, which in turn, as the data shows, will positively affect your bottom line.

2. Offering a streamlined shopping experience

As previously mentioned, the social commerce ecosystems bring together merchants, manufactures, influencers and the end consumer, providing a streamlined and interactive shopping experience.

In turn, manufactures who focus on offering a streamlined shopping experience will set themselves apart from the competitors, find new partners to collaborate with, and ultimately have more opportunities to grow their customer base and increase sales.

3. Increased innovation opportunities

Social commerce allows manufactures to build a direct connection with their target market and end consumers. Being a two-way communication channel, social commerce provides you with vast amounts of insights in the form of customer feedback and purchasing behaviour data.

You can then use these insights to improve your products and further innovate based on customer wants and needs.

4. Establishing your brand image

Typically, manufacturing companies focus on simply explaining what they do. Nowadays that is not enough. Without a manufacturing brand in place you might find your business falling behind.

Manufacturing branding goes beyond what you do. Instead, it focuses on telling the story of what you stand for. And your business partners as well as end-consumers care about your values and why you do what you do.

Before, manufactures would give the marketing and promotion responsibilities to the retailers. While social commerce allows manufacturing brands to be in control of how their brand is perceived and collaborate with their partners to build products that the end consumer wants.

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