IAB Compass: Navigating Shoppable Advertising

Shoppable ad trends & forecast

There is likely to be growth in shoppable advertising across social media, search and streaming TV. At the moment, there is currently more visibility of shoppable trends within social media as social commerce is well-established in China and, to an extent, the US. Search and streaming TV are currently more nascent when it comes to being able to make sales directly through these platforms, but they will likely gain traction.

Focusing on social media, the social commerce market is expected to grow from c.£428bn (gross merchandise value) globally in 2021 to c.£1.1tn in 2026. US social commerce sales - probably the best barometer for UK potential - are expected to rise from c.£32bn in 2021 (4% of the ecommerce market) to c.£82bn in 2026 (6% of ecommerce).

We estimate UK social commerce sales stood at c.£2.4bn in 2021 (2% of ecommerce). The UK market is less mature than the US, which is generally prioritised when it comes to new shoppable solutions.

Assuming UK social commerce grows in a similar way to the US, but lags slightly behind, we estimate sales to reach c.£6.8bn by 2026 (3% of ecommerce). Key drivers will be growth in ecommerce more generally, as well as consumer uptake of social commerce and other shoppable services.

To find out more, please see page 19 of the full report.

The shoppable ad opportunity & what to do next

Shoppable ads offer wide reach and effective conversion by removing friction in the shopping process, as well as clear attribution when ad impressions are served and transactions take place on the same platform. The potential for amplification of sales on social media is also an important factor.

As the market develops, there are likely to be increasing opportunities for shoppable ads and content across social media, search and streaming TV, as well as in new media experiences e.g. AR, visual search, VR and virtual worlds. The latter, in particular, could enable engaging experiences that can support brand and performance goals.

What should advertisers & agencies do?

Advertisers new to shoppable advertising should engage with relevant platforms across social media and search, identify opportunities to complement existing advertising/ecommerce activity, and start running simple experiments.