Why is Social Commerce The Future of E-Commerce? transcript

$1.3 trillion is what social commerce has been in Asia this year alone $1.3 trillion that's a completely different ball game than what we're doing here right now right like last month Tik Tok shop was 700 million we are just at the beginning of what this social commerce craze really is and why consumer behavior is going to change [Music] forever that is um a staggering number $1.3 trillion is a staggering number I had no idea that was the case I would my followup my immediate question actually was going to be or my clarifying was like how much really am I sleeping on Tik Tok shops and your answer there appears to be like a lot you're sleeping on it too much if you're not getting into it well generally generally that area like southeast Asia China is about the same right as far as gmv is concerned as America right so if we think that this is about a 1.3 trillion dollar 1.3 to 1.5 trillion doll industry that is what people are sleeping on right now now yeah right so is is this like the most incredible thing right now well I'd say I'd say in some ways Yes actually right for the brands that are actually understanding it and taking advantage of it yes um I I have been on the Forefront like on this on the kind of cutting edge of it just kind of barely seeing like what is it and it's funny because I'm a Canadian I don't even have access to Tik Tok shop and yet I see this incredible uh just this incredible future of what shopping is going to look like like and how people are going to shop and we're absolutely all in on it yeah um okay that so when you so let's actually Define a term here you you use the phrase social commerce um what do you mean by that exactly so when I'm talking about social commerce I'm talking about the checkout actually happening within the app itself right so within the social app itself but there's been there's been you know meta checkout for a long time do I consider consider that social commerce no I consider social commerce when it is being influenced by uh by other people on The Social Network right so you and I so something that I would consider social commerce I'm like hey Andrew do you have a good app for this and you tell me about it right word of mouth I consider that social commerce what Tik Tok shop has done is it's come into affiliate marketing right influencer affiliate marketing and it's really created that that same type of word of mouth it's just the way that people like to scroll on Tik Tok that has happened to absolutely exploded that's the social aspect of it right so when I look at social commerce it's like it's it's not so much search right it's actually seeing what other people are doing and being like Oh I like that before it was like hey I like that I'm going to bookmark that for later right oh I like that person's like that influencer and so I'm going to kind of listen to what they say but it wasn't really direct response social commerce is direct response influencer marketing yeah yeah I mean you you what you've had to do for a while is like the game plan like the sh guy I just had Taylor lag on here you know where it's like get you know you seeed the product to the influencer on Instagram or Facebook or whatever they they post about it then you grab the content and go put it in ads manager so you actually have to like there's like this middle step in there the the way they've done a lot of influencer marketing for a while right where you're like you like you aren't you know they would even say after running a bunch of influencer agency stuff like this is um the influencer approach like the post is gravy basically what you really want is the content to go put in your ad and and what you're talking about is something very different than that right which is like now now the actual like everything about it is going to happen at the level of the influencer affiliate relationship um and and that's not I mean I don't want to sound like that's breaking news like we've we've heard about Tik Tok shops for a little while and I was actually also talking with Taylor holiday recently um for for also an episode of the podcast and we were I was talking about how there's this thing where for you know 10 years basically my entire time in e-commerce there's there's this Dynamic which is that meta ads just rules the roost like you you build your business on meta ads and you know there's these outlier cases you know Isaac mad's out there just getting endless YouTube views and and you know whatever right there's some people ISAC is amazing when it comes to YouTube like have you had him on before like yeah a long time ago it was one of my most popular episodes ever actually it's not even on YouTube because before I was even on YouTube but like if you go back into my pod feeds you can find it it's actually great episodes it was when he was doing Katana stuff and it was like 10 million in Revenue zll in ad spent and you're just like what in the world this is the most profitable business in the world um but um but yeah but like but see that's exactly it though he's such an outlier um and increasingly one of the things that I've seen is right now you're hearing people talk about app Lov as this other Dynamic so that's like total separate thing you know right where it's like oh whoa Facebook like grow ass at like meaningful scale but the only other thing I can think of recently that I've heard of anybody talk about that is like this even though I've thought for a while this kind of thing was going to happen like meta at some point met wasn't going to be the only thing for ever you know um was Tik Tok shop and it was people going like oh okay but it seemed to me that there was like this real PTO principle kind of thing where a few people more than more than Isaac mados on YouTube but a few people are making a bunch of money on Tik Tok shops um but that it was but that it was only a sort of subgroup and I'm increasingly hearing little bits of chatter like you really need to be lower aov you really need to be the right customer you know um and so I like part of the reason I was so jumped at like oh Jordan please come on my podcast is because I'm uh stealing Knowledge from you right now so that I can uh understand how how you see the world with this like what is happening right now with Tik Tok shop and then where is this going you can answer that in any order that you want so this is I think that that it's all kind of combined together right it's not just it's not just today cuz today is also amazing for nearly every one of my clients our Facebook ads pixel is installed with Billy not with a Shopify native integration not with any other thirdparty tool out there and that's because Billy is the best meta ads pixel tool in the world of which I'm aware it's also the most affordable the way I know that is because I've run tests with Billy against the native Shopify integration I've run it against other thirdparty tools and over and over and over again Billy reports the most complete picture of my actual roas my actual performance because it tracks the most information the best and also uh it gives me the highest event match quality score scores of anything that I've seen so it is objectively the case that's why I use it and I love it you can get started for $1 today there's all kinds of other great things about it go check it out right now b. a go use Billy today today is incredible right we have all of the eyeballs think about how much time people are spending the 170 million daily users in the US are spending on Tik Tok we've known for a long time that Tik Tok drives a huge amount of business in basically every single product category the problem is we didn't have really good attribution right and we were relying again it's funny because I just had Max blank one of the founders of triple whale on and we we're talking all about multiat attribution and this move to MMM right and this move to more more of these bigger kind of models that are actually modeling out like what exactly is pushing actual consumer Behavior right and we found out that Tik Tok was actually one of those things that was right a lot of organic on Tik Tok and Tik Tok ads now the problem was Tik Tok as a platform is so ridiculously good at keeping you on the platform that it's horrible for advertisers in a direct response way we never saw anything meaningfully at scale like we did with Facebook right Facebook is really good at getting traffic to your site knowing who to get there and KN knowing who was going to convert at the time Tik tok's thing is that they're so good they're the crack of social media more than anything right they're so good at keeping you on the platforming keeping you scrolling on the platform so they were the perfect ones to introduce social commerce right and they introduced it in a hard way and so today I I think all of those things that you said are wrong they're they're just they're just wrong and and the reason why is I have this incredible case study right now of a very well-known shoe brand with an aov of 80 to9 yeah that is absolutely crushing on Tik Tok shop right absolutely crushing now here here's the other crazy thing is that it's not just that so we we were able to get them from zero to seven figures monthly the fastest of any of these big Brands um which was which was phenomenal but it wasn't just that it was that their their VP of e-commerce was coming to us and saying hey our CEO is wondering what the halo effect is because we've never seen such a sell through on dotcom on Amazon and in retail everything is up and we can't really figure it out because we this is kind of the one big new initiative and we're only doing I mean this is a billion dollar brand right we're only doing a million dollars a month right now so they're like to them that's not really a big deal yet but they're seeing it everywhere right and so we're we're coining this and I'm coining this I I'll take it the Tik Tok shop effect right that that there is this there's this thing that happens and you can see like if if you've talked to Paul from from BK Beauty at all and seen anything that he's I have him scheduled for like a week or two from now yeah awesome so talk to him about the Tik Tok shop effect because you'll see he was just floating along like like a norm Ecom dude doing maybe five million bucks a year right nothing to write home about and then boom went on Tik Tok shop and up like that yeah right so there's something there's something there about the influence that Tik Tok specifically has and I think it's going to translate over to Instagram I think in when Instagram and Facebook and when meta releases their platform we're going to see something happen over there very similarly right right now it's not direct response we we know influencer marketing isn't direct response resp um and it's not necessarily influencers that are doing all the selling sorry Andrew I feel like I can just talk and talk and talk about this stuff so I'll let you like jump in here no I uh I I was loving if you if you didn't just lose that thought keep finish it you're doing great I mean I appreciate it it's really helpful yeah I mean the the big news is that social commerce is here to stay right let's just say January 19th like the the US is crazy and shuts Tik Tok down which is not going to happen right no nobody thinks that that's going to happen in fact even Trump today said that he is not going to allow that to happen on January 19th yeah so we know that's not going to happen but let's just say that it did social commerce as a theory is here to stay right shopping within these apps is here to stay live shopping is here to stay I was recently in San Diego um and I went into a uh a shoe store and I heard this guy being like really loud in the back and he was behind a curtain and I was like what is going on in here and then I realized oh the dude is live selling on whatnot and he's just going through and he's just like all right I got this thing and he pulls it out he's like all right sold to you and it was like every 10 seconds he was selling something live selling in his retail shop and that was part of this experience that was going on in the background and I was like oh my gosh the Asia is here right this is not a new thing in Asia this is very normal right think about it we have one agency that I know of in all of nor America that has live shopping capability for Tik Tok shop right now it's Orca in in La I was just chatting with them yesterday I don't know if anybody else maybe there's like a few outliers out there we do not have the infrastructure built for this yet and yet it's coming right we can see it's coming and and it's here at the same time right it's one of those things where it's like we are build we're building all of our capabilities right now knowing that social commerce is going to be the next big play [Music]