Baron, 27, gets a certain satisfaction from “finding those little things and little products” that are easily overlooked. But her TikTok videos of curated gift ideas tap into a key and growing audience: People who shop for the holidays — from inspiration to purchases — on social media.
Research shows that 60 percent of Gen Z (born from 1997 to 2012) and 56 percent of millennials (1981 to 1996) will do at least some holiday shopping on TikTok, Instagram, YouTube and other similar apps, according to consulting firm Deloitte. That’s a significant jump from the 49 percent and 46 percent, respectively, recorded in 2021. Even Gen X and boomers have enjoyed the trend, the study found.
In addition, social media is an important starting point: 6 out of 10 shoppers say they get “inspiration and ideas” from the sites, according to a global study conducted by the IBM Institute for Business Value, in partnership with the National Retail Federation.
“Social media provides exposure to a lot of other brands that we wouldn’t otherwise have access to,” said Logan Stenseng, 24, of Iola, Kan., a small town about 100 miles southwest of Kansas City. She uses Pinterest for gift ideas but also hunts for bargains on Facebook Marketplace. “You also see what’s fashionable in other places, and useful or practical things that help other people that you can’t find in stores here.”
The platforms allow for a seamless shopping experience, said Bobby Stephens, a partner at Deloitte who specializes in the retail and consumer products industries. And he expects more companies, brands and platforms to move in that direction as consumers continue to gravitate towards product reviews, pick lists and unboxing videos.
“I think it’s a very engaging and modern experience for the end consumer,” Stephens said. And with younger demographics spending more time in the app center, “what you’re seeing are brands and retailers delivering content to them.”
The branded content market reached $10.4 billion last year, according to Grand View Research, a market research firm, and is expected to swelling in the next few years. Fashion and lifestyle brands represent the largest slice – about a third – of the market, the analysis found.
How TikTok ate the internet
The shift is among the many ways consumers have changed their buying habits in the face of decades—high inflation and rising interest rates. Shoppers are smart – they hunt for bargains, compare prices, cut coupons – and buy early, in part to spread spending over the season. The National Retail Federation projects holiday spending will range from $942.6 billion to $960.4 billion in November and December, which is 6 to 8 percent more than last year. The figures do not include inflation.
Retailers have had to adapt this year as inventory and labor costs rise they burn their margins, forcing them to release sales early and reduce their extensive inventory. But they also saw that consumer expectations have changed, even after individual purchases have returned to pre-pandemic levels. Comfort and service were paramount. Curbside pickup, online shopping and in-store pickup, and self-checkout became the norm.
Allison Stackhouse, 24, finds herself shopping on social media because that’s where she spends most of her free time.
“All the tracking information built into my phone – it knows what I like, it knows what I want,” he said. “It’s like, you think [a product]. They throw it in your face and you’re like, ‘Okay, now I’m going to buy it.’ “
TikTok again Facebook’s parent Meta led the trend among social media companies. In 2020, Instagram announced a new shopping feature for merchants to create virtual stores, making it easier for users to click and buy. Now, the app has a “store” tab in the bottom toolbar.
TikTok, which in five years became the leading social media application among Gen Z, expands opportunities for brands, provides tools and guidelines to better attract audiences and manage ads. The app has also rolled out a live shopping feature in the United Kingdom and Asian markets. The social media giant is preparing to launch in the US in the coming weeks, reports the Financial Times.
But there have been stumbling blocks. On Wednesday, Meta announced it would lay off 11,000 workers, citing an e-commerce boom during the crisis. The decision came three months after Meta announced it was shutting down its live shopping feature on Facebook after poor performance.
Ryan Detert, CEO of Influential, an influencer marketing firm, said that even though Meta has moved away from the arena, he expects influencers and brands to rely on live streaming. The experience is simply an enhanced version of watching someone review a product on video, he said, but now viewers can interact with the talent and ask questions.
Detert pointed to the incredible success in the Asia-Pacific region, where “200 billion – with a B – is spent on live commerce every year.”
“Consumer behavior,” he added.
Change is a natural extension of humans who already shop on social media and turn to apps like TikTok to research products. Stenseng, of Kansas, said he uses the app as his search engine because it is full of information and honest product reviews, allowing people to be informed about consumers, he said.
Liv Picarillo, a 24-year-old consultant in Boston, said she likes shopping on social media because of the added convenience.
“You’re just scrolling through Instagram and you see this really cool thing that you like, and you can click three links and it’s at your door in two days,” she said.
But how influencers present products matters to young consumers, who have a radar for non-pretentious endorsements. Both Picarillo and Stackhouse, a New York marketing expert, say they won’t even entertain a post if it’s clear the influencers aren’t going to use the products themselves.
This is something that TikTok creator Naomi Hearts, 24, thinks every time she is approached by a brand. As a plus-size trans Latina with over 918,000 followers and 62.7 million likes, Hearts feels a responsibility to ensure that companies he recommends that they be inclusive and consistent with his principles. He carefully considers each product to make sure it’s right for his fans.
“I think going to social media to sell a product is a good investment,” Hearts said, adding that fans “will buy what you’re selling because they love you and want to support you.”
Amazon was the first to be discovered, launched an influencer program in 2017 and developed “Influencer Storefronts” where creators can include links to things they talk about in their feed. If a follower buys something through that link, the promoter gets a commission. The latest Walmart announced a creator platform where influencers can host live shopping experiences and link to brands.
Retailers stock up on deep holiday discounts starting now
Full-time designer and content creator Claire Wenrick has been working with Amazon since she was in college. About 40 percent of his income comes from affiliate marketing, he said, with another 40 percent from product deals and the final 20 percent from his creative training business. In a good month, the 23-year-old New Yorker makes about $5,000 from her Amazon storefront.
Amazon doesn’t pay Wenrick to promote things, he said; instead, it encourages him to link the products he talks about on his TikToks to his storefront. When he reaches a certain amount of sales in a month, the company sends him a gift card that he can use to order more products to review on social media.
Now, Wenrick is starting to curate his holiday shopping content. Since sales are expanding before Black Friday and Cyber Monday, you’ll start promoting your affiliate links early. He also plans to do his “favorites for 2022,” he said, a series that did well for him last year.
“I think sharing products that I’ve used and loved throughout the year helps people buy the product rather than just throwing something in their face that I don’t have or know I like. ,” said Wenrick. “People like to be updated.”
For Baron, who posts holiday gift guides and works full-time at a consulting firm in Newport Beach, California, TikToks are part of her. In a good month, he can make up to $5,000 from affiliate links and product deals. But making money from his videos wasn’t his first goal, he said. By November of last year, he had about 300 items in his spreadsheet and realized there was no point in keeping his unique finds.
“It’s great for people to hear, ‘I got a gift this past year,’ ‘I’ve gotten this as a gift before,’ or ‘This is something I’d like personally,’ ” Baron said. “Having that personal touch and knowing that it’s something that someone else can enjoy, I think it’s very rewarding when you actually go shopping for gifts.”