Rise of social commerce brings new challenges

Social commerce is rapidly gaining ground in the Netherlands. For instance, 61% of consumers consider shopping via smartphone as the most efficient method. Also, 49% see social media as the way to stay on top of trends. However, a new retail report by Soti shows that there are considerable challenges for retailers that can significantly undermine consumer trust and loyalty.

The rise of mobile and app-based shopping is challenging the retail industry to adapt, according to Soti, a mobile solutions provider. Among Gen Z, 70% now see the mobile phone as the most convenient way to make an online purchase. Among baby boomers, the figure is 36%. Also, 49% believe social media is a good way to keep abreast of trends. An opinion especially prevalent among Gen Z (60%), but much less so among baby boomers (28%).

Personalised shopping experiences

With more than half of consumers (56%) preferring personalised shopping experiences, social commerce is ideally suited to provide personalised recommendations and targeted ads that match individual preferences. But despite the growing popularity of social commerce, Soti sees major challenges for retailers that could undermine both consumer trust and loyalty.

For example, of those who shopped via social media in the past six months, 36% experienced delayed deliveries. In addition, 30% never received updates on product availability after showing interest. Also, 24% received products that were significantly different from what was ordered. Finally, 18% experienced a website or app that constantly crashed.

These logistics and supply chain challenges are all the more urgent as 77% of Dutch consumers say speed of delivery and variety of delivery options are top priorities when shopping online. To harness the full potential of social commerce, retailers must therefore prioritise seamless mobile platforms and stronger supply chain models to meet consumer expectations, Soti says.

Consumer protection and building trust

When making purchasing decisions, consumers need confidence in the retailer and the payment system that protects their personal data. The report shows that 72% of Dutch consumers are concerned about entering personal data online or on a device in shop. More than half (53%) worry in this regard that smaller retailers are unable to keep personal and payment data safe. 23% are uncomfortable with tracking purchase links from social media.

‘In today’s fast-paced, digitally-oriented world, consumers expect more than just competitive prices and convenience. They also need confidence that their personal and payment details are secure. Retailers that prioritise reassuring customers about data security will not only meet the expectations of anxious consumers, but also build long-term loyalty in a market that increasingly relies on trust,’ says Peter Schuchmann, Director of Sales Benelux at Soti.

Deploying secure mobile technologies crucial

Despite these concerns, 68% of consumers in the Netherlands have no problems using third-party payment solutions, such as PayPal. This shows that although traditional payment methods are sometimes viewed with distrust, trusted third-party solutions can help restore this trust.

With the introduction of stricter cybersecurity requirements under the Network and Information Security (NIS2) directive, it becomes crucial for Dutch retailers to deploy secure mobile technologies to manage consumer data and comply with these new standards. This presents an opportunity not only to comply with regulations, but also to simplify and improve the consumer experience with retail brands, Soti says.

For the report ‘The rise of social commerce: online audiences embracing technology turn into influenced buyers’, a total of 12,000 consumers aged 18 to 65 were surveyed. They came from 10 countries: Australia, the United States, Canada, Mexico, the United Kingdom, the Netherlands, Germany, France, Sweden and Japan.