Do people find products or do products find people?
On 30 March, EACA participated in the webinar “When Products Find People, Businesses Find Growth” organised by IAB Europe in collaboration with Facebook. The webinar discussed how e-commerce platforms and social networks are changing the way people shop. Increasingly, social media is being integrated with e-commerce platforms and this has led to brands having to keep up with evolving trends, technologies, and new approaches to better exploit the business opportunities they represent.
In 2020, partly due to the Covid-19 pandemic, there was a shift in advertising towards digital: in 2018, €67bn was spent on traditional advertising and €58bn on digital advertising. In 2020, €51bn was spent on the former and €62bn spent on the latter. This investment by advertisers has had a big impact on consumers: in fact, an extrapolation made by EUROSTAT showed that in 2020, two-thirds of the population in Europe used e-commerce. This not only included existing users, as could be expected but also first-time e-commerce users.
Social networks have become a way for consumers not only to communicate with each other but also to learn about new brands and products. It is estimated that globally 40% of new users learn about a product or brand through a social network (data from Facebook).
Besides, users’ awareness of online shopping has increased. In fact, in 2020, there was a 10% increase in the number of searches made by users before making a purchase. This demonstrates a reversal of the trend: users do not make purchases just because they are attracted by an advertisement, but because they have informed themselves and are genuinely interested in that product.
This has led brands to review their marketing strategy and look for new ways to connect with people, create empathy and a sense of community with users: from launching message rooms, to investing in reality labs and engaging influencers.
Despite this development, however, globally more than 80% of purchases take place outside digital channels. Nevertheless, a positive trend in the development of e-commerce can be seen. This is demonstrated by the fact that during the lockdown period, there was an increase in the use of e-commerce even when shops had reopened indicating that e-commerce is slowly making its way into the lives of consumers, replacing shopping in person.