Facebook has taken another big leap into ecommerce – a market that is predicted to be worth $350 billion this year. The platform has begun testing shops within Pages, allowing businesses to sell to customers directly. Complete with “buy” buttons, these mini-ecommerce sites allow the entire shopping experience to take place on the social media platform – from product discovery to making a purchase.
Currently, most of Facebook’s revenue comes from advertising, and this is driven by the data that users provide. By offering people a seamless online experience – including the ability to buy their favourite products without having to the leave the platform – Facebook further cements itself into people’s online lives.
What is happening to commerce elsewhere on the web?
Facebook isn’t the only online social media platform to explore ecommerce functionality. Both Twitter and Pinterest have introduced shopping experiences of their own, such as Buyable Pins. Instagram (the photo sharing app owned by Facebook) has also enabled “Shop now” calls to action on adverts. Moving away from social into the world of search, even Google wants a piece of the action, recently unveiling its own Buy Button.
One of the main driving forces behind changes in the online retail landscape is mobile. Having a mobile-friendly website was made even more vital when earlier this year, Google announced they would be boosting the ranking of mobile-friendly pages on mobile search results. You can read more about the update on the Google Webmaster Central Blog.
However, apps are also a significant part of the online experience on mobile devices. According to research institute Forrester, we spend 80% of our time on mobile apps within the top five apps. It’s becoming increasingly difficult for online retailers to get the attention of customers. Therefore, it makes sense for Facebook to exploit this need by giving businesses space on the platform to sell directly to users.
Important considerations for retailers
This latest project by Facebook is still in its infancy, with less than a hundred test shops said to exist (Facebook won’t release the names of the businesses currently trialling the feature). However, based on what Facebook has done in the past, there are a few things retailers should consider.
The first is how much selling directly to users might cost. Facebook currently doesn’t make money from sales that take place on the platform. However, as we’ve already pointed out, online commerce is worth a lot of money – even more than digital advertising. Facebook won’t want to miss out on a slice of that pie.
Facebook also has a track record for offering something for free then changing their minds later on. Businesses used to be able to communicate with their fans easily in their newsfeeds. When Facebook decided to reduce the organic reach of Pages, businesses had to resort to paid advertising in order to reach the same people.
It is perfectly possible that Facebook will monetise shopfronts on Pages in the future. However, if the trends in mobile usage and social commerce continue, retailers might not have a choice if they want to get their products in front of customers.
Main image via Maria Elena on Flickr.