Social media has minted its own internet celebrities, but many entrepreneurs are trying to judge whether platforms such as Instagram and Facebook will make fortunes for retailers.
With the billions of people checking social media every day, these platforms should be natural candidates for shopping. In mid-2020, the platforms, both owned by Facebook Inc., the Menlo Park, Calif., technology conglomerate that earned more than $70 billion in 2019, introduced Instagram Shops and Facebook Shops. In the future, consumers will be able to pay for items through Facebook’s Messenger and Instagram Direct.
The timing to introduce the Shops feature could not be better. 2020 was the year that digital commerce skyrocketed. E-commerce sales increased 49 percent during the 2020 holiday season, according to a report from Mastercard Spending Pulse, a market-research group of the Mastercard payments network. However, commerce on social media is still considered relatively new yet a force that is gaining momentum, said Paula Rosenblum, managing partner and co-founder of Retail Systems Research, a Miami, Fla., market-research company focused on retail technology.
Currently, social media is an important forum to introduce consumers to products, Rosenblum said. “What you are talking about here is the purchase journey. It fits into product discovery,” she said.
Product discovery is a primary social-media function for Lisa Kline, a once-prominent bricks-and-mortar retailer. In 2011, she closed her Lisa Kline physical boutiques, which had cultivated a big following when they did business on high-profile shopping streets such as Los Angeles’ Robertson Boulevard.
Since 2011, she has worked as a retail consultant for high-end hotels like Shutters on the Beach and organizing brand placement for programs such as the “Today Show.” But in June 2020, she got back into retail by opening shoplisakline.com, a Los Angeles–headquartered digital-commerce retailer where the @shoplisakline Instagram page is an important part of the operation.
She uses Instagram and Facebook profiles to tell the world about products that she is curating and to reintroduce Lisa Kline to the shopping public. Before the COVID-19 pandemic, and definitely before digital commerce dominated retail, the way to tell the world that a retailer was ready to do business typically required opening a physical store. Along with serving as a place to make transactions, the physical store would serve as something of a billboard, according to conventional retail wisdom.
“Social Media has been crucial for promoting my new website, letting people know I am back in the space, and promoting brands. I already see it working by bringing in sales off of Instagram and Facebook posts. In 2021, there will be a big focus on promotion via those social-media channels,” she said.
Social media has been reaching its revenue-making potential for Wallis Barton, who makes most of her income from the vintage-fashion boutique The Cornwall Collection, which she runs on the Instagram page @thecornwallcollection. She also earns money through working as a style influencer on the Instagram page @_wallis_. If it weren’t for Instagram, her avocation for vintage fashion would have remained a serious hobby. Since 2018, she has sold vintage designer fashions, as well as vintage T-shirts, and, more recently, furniture and homewares on @thecornwallcollection. She believes that many who are interested in vintage clothing’s sustainability angle visit her profile page.
“It’s a lot Gen Z and Millennials” Barton said. “They pay through Venmo and give an address. I put their orders in the mail.” For those who do not frequent Instagram, she has also produced the e-commerce boutique thecornwallcollection.com. However, the informality of social media has built a community around her Instagram pages, she said. “I put an item on the page, and they DM me,” Barton said of the direct messaging feature on Instagram.
The pictures and the video she posts also develop a conversation around the clothing that she sells. “[Shoppers] get to have an experience,” Barton said. “You get to know me and it feels more personal. I am not a nameless, faceless company. You are helping to support me, my rescue dog and two cats.”
BY ANDREW ASCH