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BizReport : Ecommerce : May 17, 2021

Reports: Social, payment options at issue for merchants, brands

The interest, from both merchants and consumers, in social commerce continues to increase. But at least one report notes that many shoppers remain wary of actually buying from social media sites because of data risks they associate with social media. That, according to experts, is why merchants need to make a specific change to their social commerce campaigns.

by Kristina Knight

Omnichannel payments may be the next big 'get' for merchants, especially in the social space. That is a key takeaway from new Semafone data which indicates that while about 56% of shoppers are wary of making social commerce purchases because they associate data security risks with social media, especially when it comes to their money.

"Brands need to educate customers on the steps they have taken to ensure consumer privacy and security measures within their overall marketing and awareness strategies as it is a critical component of retaining and attracting customers," said Gary E. Barnett, CEO of Semafone. "Cementing new transaction methods with customers is an ongoing challenge. The phone has become a lifeline of sorts in the past year, but when using it to share PII or financial information, there is a fear to overcome. Fortunately, there are solutions that not only provide the high-level of security needed today and ensure compliance with PCI DSS and other regulations, but they also create a superior customer experience."

Barrett believes omnichannel payment solutions are key for merchants moving forward, even as more stores re-open to in-store shoppers, because so many consumers have expressed continued interest in buying online and even BOPIS options to avoid checkout lines.

Those changes in payment options and even education regarding brands' commitment to customer privacy and date security is more important than ever as more and more brands push ad dollars into the social space. StitcherAds data reveals that in April 2021 brands increased their Facebook ad spend by 135% YoY (year over year) and 19% MoM (month over month).

Those increases came as Apple released their iOS 14.5 update which gave consumers more control over the data shared via their smartphones and devices.

"Large brands are not backing down from the iOS 14.5 update," said Bryan Cano, Director of Media Strategy, StitcherAds. "The early announcement by Facebook has given brands the opportunity to reallocate budgets and shift more towards Paid Social in order to maintain growth and Share of Voice. Unfortunately, this means smaller businesses and advertisers will need to compete in a more competitive auction while facing all of the headwinds caused by Apple's iOS14.5 update."

Meanwhile, new data out from PaySafe notes that the shoppers are looking for choices when it comes to buying - both in-store and online. Their new report finds that about one-third of global shoppers say they understand more about alternative payments now than pre-pandemic, and that while about half (54%) continue using debit cards, most (53%) say they'll leave a merchant site if the checkout is difficult or if they aren't offered payment options.

The most popular 'alternative' payment option? The mobile wallet with about 43% of global shoppers using them in the month before the survey was taken. In the US about 40% of shoppers are or have used mobile wallets; 47% of UK shoppers have used mobile wallets and 55% of Italian shoppers have used mobile wallets.

"Consumers have adapted and gotten to grips with alternative payment methods over the last year, partly because they had to due to the pandemic. Through our ongoing research into payment trends, we continue to witness that COVID-19 has been a real accelerator in the adoption of alternative payment methods and choice is everything," said Philip McHugh, CEO, Paysafe. ""Concerns around payments security have also been a constant theme coming through in our research, and consumers are increasingly alert to the threat of cyber risks, so it's not just about offering choice, it's also about ensuring peace of mind from a security standpoint, coupled with a frictionless experience."

More data from PaySafe's Lost in Transaction report can be accessed here.

Tags: advertising, ecommerce, ecommerce trends, PaySafe, Semafone, social commerce, social marketing, social shopping trends, StitcherAds

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