Be it choosing what to buy, when to make the purchase and even resolving daily problems such as managing waste and traffic, community networks are likely to be the big influencers in 2020
How do you reach out to the young, wary shopper in 2020? Talk to their friends and family, get into local community networks and messaging boards and get social. A recent report on consumer behaviour by Kantar, a research and data insight consultancy, indicates that almost every big behavioural trend that will define the year ahead, stems from a growing reliance on trusted cohorts.
The consumer wariness on account of an economic slowdown is evident in the two big top trends the report finds (waiting to spend and waiting for deals to make a necessary purchase). However what is interesting is that almost every other behavioural signs that make the list, show a growing proclivity among Indian consumers, to lean in on friendly networks. Be it choosing what to buy, when to make the purchase and even resolving daily problems such as managing waste and traffic, community networks are likely to be the big influencers in 2020.
Consider the spate of social commerce apps that have opened shop, in barely two months into the new year, there are four new entrants into the market with Paytm, Sheroes, ShareChat and Instamojo throwing their hat into the ring. Social commerce, as the name suggests, works within the social network of apps such as WhatsApp, Instagram and Facebook to deliver a payments system that uses a combination of methods to acquire and engage customers and it is among the top five trends that Kantar predicts will define customer behaviour in 2020.
Meesho, the top-funded start-up in the category and backed by Facebook, uses a referral model. It lets sellers put up their goods and connect with re-sellers, essentially homemakers who agree to use their own WhatsApp network to sell these items for a commission. It now has two million re-sellers across 700 cities.
“Social commerce is a new way of leveraging a traditional practice in consumer behaviour — personal referrals,” said a spokesperson from Kantar. Such engagement creates entirely new purchase behaviour and what social commerce leverages is trust — both in individuals and communities, the report said. It offers small and medium businesses, as well as individuals starting out with their new offerings — a platform to quickly reach a community, and engages them in conversations where referrals play a massive role.
“Regular e-commerce works on search — you type in what you want and it shows up — or scroll through or click on a picture,” says Sajith Pai, a director at Blume Ventures. He believes that social commerce has helped remove some of friction in ecommerce. Now content-commerce will remove some others. “It is almost as if, the expanding e-commerce landmass needs new hooks to connect with audiences,” he adds.
Big venture capital (VC) investors such as SAIF Partners, Accel, Omidyar, Naspers and Sequoia are among many others have pitched for social commerce. By some estimates, over $300 million has been poured across social commerce investments in the past few years. Apart from a referral system, the apps are also using video and vernacular to expand their user base. Take BulBul.TV and SimSim for example, they use videos to pitch and sell products. Another social commerce platform Mall91 combines live videos-based shopping, local language voice recognition-based catalogue discovery and Whatsapp like chat/messaging checkouts — features it claims directly work with the ‘Bharat’ audience.