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Every so often, retailers and marketers realign their initiatives to fit ever-changing consumer trends. Each trend cycle seems to come and go quicker than we can keep track of. But there’s a not-so-new trend that most of us have taken part in that researchers are finally putting a name to: squad shopping.
In the digital age, the term squad shopping can take on different meanings. Dave Bruno of RetailWire defines squad shopping as “the use of video and/or screen-sharing technology to shop online with friends and family”. He theorizes that the trend may represent far more than a pandemic-fueled phenomenon targeting young women longing for social shopping connections.
But how? It’s no secret that many consumers seek validation when trying on clothes, shoes, or accessories in general. What may look good to us, may be seen through rose-colored lenses, so outside approval helps seal the deal.
Even if a consumer is home alone shopping online, there’s still a sense of community and approval that squad shopping platforms provide. The more validated a consumer is, the more likely they are to make a purchase.
The research fully backs up the need to launch such a platform. 54 percent of individuals interviewed by research firm Nielsen said they increased expenses in unplanned shopping in 2019, 80 percent of which said social recommendations like friends’ suggestions and social media groups stimulated those impulse purchases. Most of us are guilty of being persuaded into a purchase by peers, and retailers are clamoring to capitalize.
Squad Shopping Makes a Splash
The concept of Squad Shopping originally made headlines when Former L’Oréal brand manager Elysa Kahn launched Squadded Shopping Party in May 2020 to encourage users to shop online with people in their network.
Verishop followed suit in December of 2020, with its own version.
Kahn enlisted the help of her father to create the platform by building a browser extension that allows its users to go shopping together on popular fashion e-commerce sites like Asos, Boohoo, Missguided, Na-kd and Pretty Little Thing. These retailers most resonate with Gen Z customers between 15 and 25, Kahn’s target audience. Other global early adopters of Squadded were Sephora France, Goddiva in the UK and Mia Jewelry in India, among others.
China Is Driving the Conversation
Chinese eCommerce has long been thriving, and retailers and marketers noticed the group shopping trend forming on the horizon for quite some time now.
The projected numbers for Chinese eCommerce in general are staggering. Over $413 billion (with a very big B) of goods will be sold through social e-commerce in China by 2022, an almost fivefold increase from $90 billion in 2017, according to consulting firm Frost & Sullivan.
Domenica di Lieto, chief executive of Chinese marketing consultancy Emerging Communications, expressed to Vogue Business that squad shopping is ubiquitous with Chinese culture, and human behavior in general.
Here’s where the cash comes in. Shanghai-based firm Pinduoduo was founded back in 2015, and encourages users to form shopping squads on social media to group-buy items. The more consumers that are interested in buying a product, the lower the price goes. The app
is the second most popular e-commerce platform in China behind Alibaba’s Taobao with an impressive seven-day retention rate of 77 percent, the highest of any shopping website in the country. Pinduoduo even roughly translates as “together, we get more”. And they’re exactly correct.
Moreover, the Covid-19 pandemic allowed JD.com to see a major boost in group shopping. According to Jiarui Liu, head of JD’s social group e-commerce initiative, sales in social group e-commerce, tracked separately from sales on its websites, in the first quarter of 2020 has exceeded that of the entire year of 2019.
Riding the wave of these numbers, JD.com enlisted in China Youth Travel Service, one of China’s leading travel agencies, on an initiative that offers tour guides part-time roles as “JD shopping guides” in popular WeChat groups.
American Heavy Hitters Join the Party
The pandemic was a catalyst for the squad shopping movement. Online group activities in general skyrocketed as we were cooped up indoors. In March of last year, Netflix introduced Netflix Party, a feature that lets users watch shows simultaneously with friends. In a similar breath, Instagram’s Co-Watching feature allows users on the site to virtually scroll with followers.
Retailers caught wind of this trend. Soon after Netflix and Instagram’s launch came the aforementioned Squadded Shopping Party. Next came retailers from the wedding industry, a sector that was particularly crushed by the pandemic. Bridesmaid brand Birdy Grey is launching a new social shopping tool for bridesmaids to pick their favorite styles, track each other’s purchases and share pictures of how they would look in a dress via a virtual try-on.
The Future of Squad Shopping
This is just the tip of the iceberg for what is most likely going to come out of the group shopping trend. Psychologically speaking, (my credentials are nonexistent, btw) birds of a feather flock together. But the issue in the west could be that there is no consolidated feather to flock under.
One of the biggest challenges is that in the West, there’s no such all-in-one omnipresent social commerce app, like there is in China. So it’s going to get increasingly difficult to track these habits, and their KPIs. Plus, economically speaking, it appears as if we’re heading to a slowdown in frivolous spending due to a purported recession. Regular shopping is going to take a hit, which means that we might see numbers fluctuate regarding group shopping.
Squad shopping is an embodiment of basic human needs; validation, and instant gratification. This communal sense of approval significantly impacts conversions, and so long as this is the case, retailers will continue to innovate and research for more efficient and simple ways to squad shop.