Social media has become the fifth limb of the upcoming generation of spenders. Here’s how brands are branching out services to incorporate this trend.
It would be an understatement to say that in 2021, the main purpose of social media only extends to building communities and fan followings. Social media has become the fifth limb of the upcoming generation of spenders and that’s exactly why brands are branching out services. This just leads to how the super app revolution is permeating social media too. With how many users social media platforms accumulate, these platforms identify whether the users have spending power and then roll out commercial features to sustain these customers.
Snapchat’s New E-commerce Section
Here are some facts about a revolutionary platform whose features sparked a copy-wave among its competitors: Snap has over 265 million daily users and their users open the application at least 30 times a day sending over 5 billion snaps. With such a gigantic host of users sitting on the application, Snap Inc realized they were sitting on a gold mine of Gen-Z: a generation that does not shy away from spending and is always searching for accessibility within the limits of authenticity.
Which led to them rolling out their acquisition of Fit Analytics, a Berlin-based retail tech startup that has previously helped customers choose the right apparel fit and footwear shopping online. Fit Analytics comes up with an expertise of working with brands like Calvin Klein, Patagonia and Puma.
With this acquisition, Snap has embarked on the journey of creating an e-commerce retail barrage within Snap. And it has already tied in big brands like NYX Professional Makeup, Ralph Lauren and Perfect Corp for campaigns where users could try on AR versions of their collections. This entire idea of e-commercializing these platforms with a huge following of spenders is smart because it understands two things: a) the love-affair Gen Z has with their front camera is unparalleled and b) tying in e-commerce might make Snap the all-in-one platform for Gen Z. No, for real because according to a research firm, Piper Sandler, US teens spent 40% of their expenditure on just the ‘Selfie Budget’ which comprises clothing, footwear, personal care and accessories.
But perhaps the biggest reason why this a great idea would be the timing they rolled this out in: the pandemic. With cases rising everywhere and vaccine rollouts taking a little longer than intended, a lot of users are still stuck to their work-from-home set ups.
How Brands Revolutionize Social Media Platforms
Anthropologie, a retail store realized the value of collecting and interpreting data while creating new features for the customers. Pinterest revealed that although most of the top search results they garner is unbranded, Anthropologie has amassed a niche within branded search. Search items like “Anthropologie home decor inspiration” increased by 1, 057% year-over-year in 2020 and “Anthropologie mirror” searches are up by 375%.
They recognized the demand for their aesthetics and now rolled out with their first digital-only catalogue. Users searching to imitate the aesthetics Anthropologie has will be shown products from their stores. They are taking advantage of the digital platforms where their customers are gathered densely. They are going where their customers are, not expecting their customers to walk to where they are.
Privacy concerns >> more $ for messaging platforms
Even messaging apps have realized there has to be some way they can generate massive revenue. And with how much privacy has become important for users all over the world (and Facebook’s terrible crisis management), the fickle nature of messaging apps has come under the limelight. And somehow, choosing the messaging app has become sort of a compromise for the users: anything will make do provided they remain transparent about their privacy policies.
But it has been issuing debt until recently. Up to 700 million dollars (according to April-end figures) debt. It desperately needs advertisers to up its revenue.
What it’s planning to roll out: non-targeted advertisements & premium features. It won’t be the first messaging platform to generate revenue by secondary features; aka Line. Line’s sticker collection was an entire revolution in messaging chats and it managed to generate at least 638 million dollars in five years (2014-2019).
WhatsApp has also launched in-app purchases, payment options and a version for small businesses too.