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User experience (UX) software startup SimplicityDX, whose mission is to anticipate and plug ecommerce revenue leaks before they happen, announced new venture capital funding and the published findings of its first quarterly 2022 State of Social Commerce impact study (registration required to download study).

The company’s Edge Experience Platform enables enterprises to optimize social commerce experiences by simplifying the buying process between sessions that start at the edge and conclude at a brand’s ecommerce site — but often stumble in between. The software-as-a-service (SaaS)-based service combines AI-powered digital-experience analytics with UX, social campaign and product inventory data; alerts merchants to problems on the fly; and automates functions to optimize revenue, chief strategy officer Charles Nicholls told VentureBeat.

What are revenue leaks?

Ecommerce revenue leaks, which happen when a potential buyer is thwarted from completing a sale, can take place in several ways. Some of the most common ones are the following: 

  • The product is shown on the website but isn’t in stock.
  • The product web page is down (404 notice).
  • The product detail page is so full of images that it loads slowly, and the customer gives up on it. Studies have shown that the average consumer with a smartphone will wait no more than three seconds for a page to show up on a screen before moving on to another site.

“Revenue leakage is one of the reasons that we did the study, and because we knew that the product detail pages are a massive revenue leaker,” Nicholls said. “Those pages leak about 14% of site revenue, which is just enormous.” 

With the average person spending 147 minutes on social media per day, it is not surprising that more than 25% of a marketer’s budget is forecast to be spent on social media marketing in 2022. However, as the State of Social Commerce study indicates, the landscape is riddled with other customer frustrations that impact revenue performance and brand reputation, costing brands significant revenue losses.

Shopping sessions start on social networks, end on brand pages

“Many shopping journeys now start on the edge, especially on social media,” Gerry Widmer, CEO and director of SimplicityDX, said in a media advisory. “However, social commerce is in its infancy. While every aspect of the ecommerce buying experience has been optimized over the last 30 years, social commerce represents both the biggest problem and the biggest opportunity in revenue and customer satisfaction for ecommerce brands today.”

Social networks are where many customers discover products, Nicholls said. Meeting customers where they are spending the majority of their time online means enabling customers to discover and purchase products on any channel, he said. But social networks aren’t necessarily where potential customers actually buy products.

“The majority of people — 71% of online shoppers — prefer to check out (products) on the brand site, then check on social comments,” Nicholls said. “Our study found that 48% of online shoppers think that using social media is a great way to learn about new products, but only 12% think it is a great way to buy new products.”

Other metrics from the study include the folowing:

  • 81% of social shoppers had experienced poor website landing experiences when attempting to link from social networks, causing $700 billion in lost annual revenue from the product detail page alone.
  • 98% of shoppers had experienced out-of-stock and inventory issues, further exacerbated by social network promotions that heightened exposure, interest and traffic. Post-pandemic, this is the number one consumer complaint about online shopping experiences.

How SimplicityDX works with social commerce

The SimplicityDX Edge Experience Platform is software-as-a-service (SaaS) that enables ecommerce, digital and marketing managers to proactively manage shoppers’ experiences for campaigns and promotions at the edge. The company claims to be able to provide baseline insight into ending the huge disconnect between social shopping and brand ecommerce sites.

The platform’s tool set prioritizes campaign and promotion performance by combining UX, campaign and product availability data, enabling brands to fix poor experiences immediately and increase their return on advertising spend (ROAS), Nicholls said.

By combining AI-powered digital experience analytics with campaign, product and inventory data, the SimplicityDX platform continuously delivers an automated system of alerts to problems affecting revenue performance, Nicholls said. Automated actions then pause social and promotional campaigns in-flight to prevent performance from being impacted and enable brands to redirect advertising budgets to products that are in stock.

SimplicityDX solves social commerce headaches for retail brands by:

  • Automatically monitoring customers’ experience signals to detect frustration points, errors and out-of-stock experiences.
  • Tracking edge shopping experiences end to end.
  • Helping brands address out-of-stock challenges by providing real-time detection of changes in stock levels and automatically pausing in-flight promotional campaigns.

Brands benefit from redirecting traffic to their ecommerce store with full control of the customer experience and ownership of customer data, Nicholls said.

SimplicityDX, based in both London and San Diego, California, was self-funded for its first nine months. It closed seed financing of $3 million with European Venture capital companies 42CAP and Episode 1 Ventures in February. The funding had not been publicly disclosed previously.

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