Expanding upon the insights shared in the initial segment of our two-part blog, the discussion in this second piece is anchored on the women who are benefitting from taking the social commerce route globally and how social media is providing them with the opportunity to become resellers and grow in a manner that accommodates their need for a flexible schedule, allowing them to be the primary caregivers in their households as well. The authors shed light on the expected continuous growth in social commerce over the years, emphasising its importance, especially for the growth of women’s entrepreneurship through social media to reach markets.
Businesses have better access to markets through social media platforms. Additionally, small businesses can diversify their reach and markets through social commerce. It provides them with the backup of steady sales through secure digital transactions and the possibility of developing a brand name. Informal online commerce platforms also offer users certain affordances that incentivise their usage. These affordances refer to the features of platforms such as Facebook and include monitoring, profiling, visibility, community engagement, customisation, and supervision (Source: Camacho, S., & Barrios, A. F. G., 2021).
In the case of women especially, social commerce is a means to their entrepreneurial dreams that would otherwise have to be sacrificed. Social constraints bind women all over the world, and while society is seeking development in terms of equality, it can still be termed patriarchal. Lack of access to financial inclusion, slow growth rates of businesses, and the barriers to entry established by formalised e-commerce platforms are just a few examples of such inequality. Instead of equal opportunities, women struggle with license restrictions, lack of investment funds, and the flexibility accompanying formal e-commerce platforms. In this context, empowerment comes from the easy accessibility of social media platforms. Furthermore, such platforms also provide flexibility to women entrepreneurs, most of whom remain the primary caretakers of their respective households. Social media allows them to manage their time according to their obligations, making their entrepreneurial endeavours possible and perfectly balanced with the management of their households.
For many women, social commerce is a unique opportunity to expand and monetise their existing network. It also ensures that there are fewer investment requirements and operating costs, making it economical for many women to start an informal business through social media and then formalise it after gaining some success.
Social commerce also allows for more customisation and personalisation and provides users with choices regarding the mode of payment they wish to utilise. The development of technology has also enabled the instalment of voice chats and chatbots that provide real-time updates and feedback to social commerce entrepreneurs. Platforms like WhatsApp allow sellers to connect and efficiently communicate with their customers, attracting repeat sales. Networking and communicating opportunities also extend to the formation of communities on social media, which play an essential role in influencing and guiding those with less experience. For example, in Columbia, a group of women started the Wikimujeres community, an all-female Facebook community created to exchange helpful information and grow their businesses. According to reports, the community currently has more than 17000 members, leading to increased communication and, as a result, more individual growth (Source: Camacho, S., & Barrios, A. F. G. 2021).
Studies have shown that women sellers perform better on social media platforms than men as they have higher average order values, better retention rates and more repeat orders, which only proves their suitability for this mode of conducting business (Source: Indian Retailer). The pandemic has also increased the popularity of social commerce, and women have led the way forward. For women facing the challenge of a lack of financial and social inclusion, informal e-commerce provides low barriers to entry and heightens their opportunities. It blankets the women in the comfort of reduced restrictions regarding investments and little to no inventory. Additionally, and perhaps most importantly, the system of social commerce provides women with the flexibility to work according to their schedules, as it is crucial to consider that women are, more often than not, the primary caregivers in most households (Source: IWWAGE).
The Positive Spillover Effects of Growing Platforms like Meesho
Indian social commerce startup “MEESHO” has enabled women to sell products like clothes, suits, bedsheets and jewellery from various manufacturers from the comfort of their homes while earning a considerable commission. This has been made possible despite the pandemic. Meesho operates in a three-sided marketplace that connects suppliers (manufacturers and distributors) and resellers with customers on social media networks like WhatsApp, Facebook, Instagram, etc. The resellers purchase products from the suppliers and earn a commission on each sale when they sell to customers. Similarly, it is effectively helping women to become entrepreneurs from the comfort and flexibility of their homes.
Meesho, which is increasingly gaining popularity in India, is a venture that is thriving on this business model. It has an estimated value of $5 billion and gained a multitude of customers post the onset of the pandemic. The company has 65 million active customers and over 100 million app downloads (Source: Zartek).
Meesho’s model is irresistibly advantageous for entrepreneurs, consumers and suppliers, amalgamating them on one platform. This has seen it quickly become a leading force in the domain. It is now allowing 100 million small and medium businesses in tier 2+ cities to sell through its digital commerce platform, giving them a boost” (Source: Tech Crunch). The venture gained popularity by offering business to resellers, primarily women, so that they could run their businesses without any monetary investments. Mr Aatrey, a co-founder of Meesho with Sanjeev Barnwal in 2015, mentioned that around 80 per cent of the resellers on the platform are women and added that the platform was established to help women begin their businesses without needing any capital investments (Source: Tech Crunch). The resellers are highly involved in sharing the products with their followers and subscribers on social media and profit from their promotions with each sold item. Meesho has efficiently capitalised on the advantages of social media and is considered India’s first social e-commerce platform. As huge players like Amazon and Flipkart provide e-commerce platforms to more privileged and established sellers, Meesho can provide homemakers, especially women, with the opportunity to earn a living by working from home. With most of the app’s social sellers being women, the role the brand plays in empowering women and aiding their livelihoods is evident (Source: Browntape).
Social media has solved the market access constraints faced by countless women worldwide and has provided them with the luxury of flexibility in terms of time management, prompting their growth as entrepreneurs. This aspect, when coupled with low barriers to entry, creates a unique platform that helps support the livelihood of multiple women worldwide and is expected to continue to do so. However, the capitalist nature of society and the economy can lead to social media platforms formalising their sales operations. Companies might start looking at commercialising social commerce as soon as it serves as a profitable business opportunity that may cause an overall negative impact.
Entrepreneurship developed through social media has other limitations that also require to be addressed. Firstly, with the influx of businesses marketing their products online, finding a brand identity that is different from the rest may be challenging. The constant updates on social media platforms that lead to a change in their algorithms require continuous attention as it may affect the visibility of promotional content. Social media is dynamic and time-consuming due to the continuous changes in trends, even if it comes with flexible hours. Social media exposes companies to public scrutiny as well. Unfavourable remarks and criticism can harm the reputation of a brand. It can be challenging to manage and respond to such input, but it is required to save the reputation of businesses. Additionally, customers can be reluctant to interact with businesses on social media due to growing concerns about data protection. While gathering and utilising client data, social media entrepreneurs will have to negotiate these issues.
The advantages, however, override any negative underpinnings of social commerce, which is only expected to grow continuously in the future. It is a move towards empowerment that needs to be sustained to promote the importance of women in business while providing them with the assistance and incentives they require to become entrepreneurs.
About the Authors
Megha Shree is a Research Fellow and Team Anchor with the Small, Growing Businesses and Employment vertical at LEAD at Krea University. Megha holds a PhD in Development Studies from Jamia Millia Islamia, New Delhi. A researcher by training, Megha has been working in the development sector on issues of Well-being, gender, technology, small growing businesses and the labour market.
Inayat Singh Beri is a Psychology and Business student at Krea University, expecting to graduate in 2024. She is an intern with LEAD as part of the LEAD Work Study Program. She is working towards a Marketing and Consultancy career and pursuing opportunities that aid her growth and learning.