Report: Social commerce on the rise despite sluggish business readiness

Many Australian businesses have no social media presence and no intention of accepting payments via social platforms

Shopping via social platforms has emerged as the “new frontier” for online commerce, with business uptake not far behind consumer adoption, according to a new PayPal study. But there’s still a gulf between consumer mobile payments behaviour and business readiness to support mobile transactions.

The PayPal Australia mCommerce index, a biannual barometer on the state of mobile commerce in Australia, found 11 per cent of Australian consumers have made a purchase via a social platform over the past six months, while 7 per cent of businesses indicate they accept transactions via social media.

Another key finding was that 71 per cent use their mobile devices to make payments, yet only 49 per cent of businesses are mobile optimised. Almost one-third (31 per cent) of businesses stated they have no plans to optimise for mobile sales, while millennials are the most annoyed when websites are not enabled for mobile (59 per cent).

Commenting on the business adoption of social commerce, PayPal Australia managing director, Libby Roy, said early adopters in the business community are getting on board with social commerce and noted business uptake is not far behind consumer adoption at 11 per cent for this new way of buying and selling.

“However, there’s a huge gap between the early adopters and the majority in the business community, with 34 per cent of Australian businesses having no social media presence at all and 89 per cent of businesses stating they have no intention of accepting payments via social platforms within the next six months,” she said.

Social media is also shown to be a strong channel for driving purchases in the report, with 18 per cent of respondents buying something after seeing it on social media, a figure that jumps to 24 per cent among the 18-34 age group. Despite this, 28 per cent of businesses don’t believe their customers want to buy via social media platforms, the report said.

Security was a significant barrier for consumers in relation to purchasing through social media platforms with roughly half stating that security and safety is a concern and 59 per cent stating they don’t want their financial information linked to their social footprint, the report said.

Among businesses, security concerns were lower (19 per cent); however, lack of understanding poses a challenge to adoption with 25 per cent of Australian businesses stating they don’t understand how purchasing via social media works.

The index also revealed finds a high level of mobile commerce adoption among Australian consumers, with 71% of respondents reporting that they use their mobile devices to make payments and 22 per cent indicating they spend more than $500 per month via mobile.

But only 49 per cent of online businesses are optimised to accept mobile payments, presenting an opportunity gap for Australian businesses looking to capitalise on mobile-savvy customers, the report found.

Additionally, almost one-third (31 per cent) of businesses have no plans to optimise for mobile sales, which is reflected in the proportion of online businesses (26 per cent) which have zero sales via mobile devices.

Roy said there’s an "opportunity gap" for Australian businesses. “Australia has one of the highest levels of mobile penetration globally with 80 per cent of the Australian population owning a smartphone, so I was surprised to discover the low level of business readiness to accept sales effectively via mobile devices," she said.

“The mobile payments landscape is fast-evolving and the Index reveals how habituated Australian consumers have become to mobile shopping with more than a third of us making mobile payments at least once a week – a figure that jumps to 47 per cent for the under 35s. So although online businesses may think they don’t need to optimise for mobile now, they will have to if they want to stay competitive in the near future."

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+: google.com/+CmoAu


Join the CMO newsletter!

Error: Please check your email address.
Show Comments

Supporting Association

Blog Posts

Behaviour change, by design

​We’re living in an age of unprecedented change. We experience with Oculus Rift, invest with Acorns, consume video through Hyper, tune into Pandora and navigate with Waze.

Glen Jeffreys

Head of UX, Deepend Group

Chat bots: How to use them commercially right now

I’m sure that many of you out there have heard a lot about chat bots (aka messaging bots) recently, and the fact that they are here to stay is pretty evident by now.

Deniz Nalbantoglu

Managing director, Webling-Interactive

Top tips to uncovering consumer insights for business innovation

An in-depth understanding of consumers sits at the heart of what we all need to do, but we know it’s not always easy to uncover insights that will unlock a true innovation opportunity.

Matt Whale

Managing director, How To Impact

This was amazing and so inspiring. Thanks for sharing.

Vijay Kumar

Design thinking: Leading with experience

Read more

Great read, thanks for posting. MR should be seen as the holy grail for marketers and brands, as it offers an unprecedented capability to...

Barney

Interview: The business case for mixed reality in marketing

Read more

what a load of shit, and what a major stuff up... the new brand device is sterile, boring and just plain bad. Would be better suited to a...

James Yoi

Tennis Australia unwraps new brand identity for Australian Open

Read more

Cool stuff. https://blogs.adobe.com/digita...

Mary

Design thinking: Leading with experience

Read more

Conversation commerce is a double edged sword. Do it right and it can create customer delight. Do it wrong and it can lose customers.

Jinal Shah

Why conversational commerce is going to reshape customer engagement

Read more

Latest Podcast

More podcasts

Sign in