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Forrester: Buy Buttons Are Not the Future of Shopping

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Nearly two-thirds of Americans are smartphone owners and 74 percent of online adults use social media, so it makes sense that brands and retailers would try to harness the power of these networking sites to connect with consumers. As the age-old marketing adage says, be where your audience is.

And with smartphone shopping soaring 63 percent year-over-year in April to account for 13 percent of total online income, according to the recently published Branding Brand’s Mobile Commerce Index, it’s not surprising that social networks want a slice of that pie.

Pinterest began rolling out “buyable pins” last week, allowing users to shop by tapping pinned products tagged with a blue “Buy It” button. Instagram, meanwhile, announced in early June it would launch ads with “Shop Now” buttons. And Twitter, which unveiled shoppable tweets last fall, recently stepped up its e-commerce capabilities with product pages and curated collections from select retailers and celebrity influencers.

Even Google is reportedly experimenting with buy buttons that will allow mobile users to purchase products that pop up in sponsored search-results without leaving the site itself. Though it’s not a social network, it is the world’s most popular search engine and most of its traffic comes from mobile.

But while shoppers and sellers alike are buzzing about buy buttons, Forrester analyst Sucharita Mulpuru said they’re more hype than substance so far, pointing out that the idea of impulse-driven purchases through an app is nothing new. “Fancy and others have been trying this for years with questionable success,” she stated in a recent blog post on the research firm’s website.

Discussing Pinterest, she said the big problem with its buyable pins is that old items that are no longer for sale often get pinned and the site needs access to real-time data on what merchants have in inventory. “That’s onerous in a category like fashion where size and color detail are critical and constantly changing,” Mulpuru noted.

Pinterest is limited to what merchants have in inventory, which means the merchant needs to send real-time data on merchandise availability to the site. “Merchants I’ve talked to say that one of the biggest problems for Pinterest is that old items often get pinned which aren’t available for sale any longer,” she said.

Instagram, however, has the opposite problem: “Its image lifespans are too fleeting to have any impact with ‘buy now’ functionality. And unfortunately, sponsored images get little engagement.” Not to mention, its core demographic of young shoppers (over 90 percent of the 150 million people on Instagram are under 35, according to a BI Intelligence report) are the ones with the least amount of disposable income.

Similarly, the average social-share lifecycle on Twitter is fleeting. As Mulpuru put it, “Tweets are too ephemeral to make a difference to a merchant in sales. Even if there was a buy button on any ad unit, few companies would really get much benefit from such an offering.”

Google, she said, presents the most promise of all but “success is relative even if it does get the execution right.” She added, “Mobile commerce is still tiny and Google’s share of it may ultimately be sizeable overall but for any given merchant it will be relatively small. The real game-changer will be when Google puts the buy button on the desktop, which is and will be the predominant way to buy digitally in the foreseeable future.”

Just as some experts say retailers need to see mobile wallet apps as more than a means of payment, Mulpuru suggested that brands and retailers need to see social media as much more than another register. “The biggest opportunity from social networks isn’t sales but the data around what keywords and images are trending,” she said, adding, “These are crucial signals that merchants don’t always get on their own.”

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