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Why is Facebook’s e-commerce offering so disappointing?

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Facebook probably has high expectations for e-commerce, but it seems that either it, or the brands and businesses present on the social networking site, are out of sync.

Some commentators see enormous growth opportunities; consultants Booz & Company predict global social commerce sales will be $30 billion in 2015. Others, however, see huge effort for no return. Retail giants like the Gap, or the department store chain JC Penny and Nordstrom have closed their Facebook shops.  And a recent study by W3B suggests that just two percent of Facebook’s 1.5 billion users have ever even made a purchase through the social network.

My company has more than 2,000 shops on Facebook, and yet we see more orders from New Zealand, where we have no marketing, no sales presence and no country-specific website, than we do from Facebook.

So where is Facebook’s e-commerce effort missing the mark? There are two key questions: Is Facebook even the right forum for shopping, and if so, are companies trying hard enough?

Commerce versus culture

While the social media marketing manager dreams of millions of loyal customers eagerly sucking up any new product and enthusiastically passing it on to their stable of 140 friends, in reality, most Facebook visitors pop in for a virtual beer with a buddy, or to share and compare cats or holiday photos.

It’s not particularly active communication, and there’s not a direct opportunity to buy anything. It shouldn’t be surprising then that any current F-commerce successes are typically limited to “quick wins” where a visitor is already motivated by the offer of specific deals or the latest iPad sweepstakes.

Sticking to the metaphor of Facebook as a bar, companies have to accept that people generally aren’t receptive to an inappropriate sales pitch while trying to relax. (When was the last time you saw a bank representative rocking out in the club and then turning around and offering their financial services products?) Even a good friend would be de-friended if they pushed their own projects or purchases too often, or even worse, used affiliate links to earn five to seven percent commission by selling to a “friend.”

Making the commonplace complex

That said, Facebook is failing brands by making it difficult to engage in e-commerce on the site. It’s very hard for businesses to highlight that they even have a shop, and every redesign on the site involves yet another reworking of one.

Facebook also wants all transactions to be carried out via their own checkout system. And since other methods of checking out aren’t integrated to use Facebook registration as a common login, customers are also forced to go through multiple logins for delivery and payment info. This tedious, frustrating process is a conversion killer that leaves the consumer better off going out of Facebook to shop where the process is more streamlined and reliable.

A lack of natural navigation for visitors, both in finding a shop and checking out, is another failing for F-commerce. Consumers have experienced enough good communication to expect easy-to-use shopping. When they don’t get it, they just go elsewhere.

And finally, while Facebook credits may have advantages when it comes to virtual goods and micropayment, it’s doubtful the average consumer really wants do deal with yet another form of currency. (As someone who does business in France, Germany, the UK and the U.S., I already have three, thank you very much.)

Unsurprisingly, these difficulties mean that brands and retailers aren’t doing very much on Facebook. If you make it too hard, consumers will never discover that they can buy on the site, and brands will shy away from investment, especially when they see no return.

Why there’s still hope

Despite all those negative setbacks, I’d argue still that the conditions are right for f-commerce:

  • Facebook still has a very high, loyal and active user base.  If you have customers, it is more than likely that they’re on Facebook. It is also possible that they react to pure advertisement differently than to real content.
  • More and more people are now buying from the living room (and soon probably even from the bar). For many of them Facebook could be the first place to look for an opportunity to make a purchase, or one of the most important starting points.
  • And while they currently aren’t making many purchases, many Facebook visitors happily talk about brands, recommend products, and share shopping experiences on Facebook. It’s ripe for a well-designed ecommerce approach.

So what can Facebook do to help brands experience better F-commerce?  It definitely needs a more friendly way to integrate a shop. The eBay setup, for example, is much easier for retailers to edit and build a section where customers can easily shop online. And Facebook could improve its mobile offering, as the rise of the tablet begins to dictate online sales.

We all know that brands need to maintain their relevance on Facebook with engaging and topical content that activates fans, makes them into advocates and creates a presence for the brand via their fans’ news streams. Yet, so far we haven’t come across anyone in ecommerce who’s truly excited by Facebook. Facebook has to change that if it’s going to make e-commerce a success.

Philip Rooke is CEO of personalized clothing commerce platform Spreadshirt. Follow him on Twitter @PhilipRooke.

11 Responses to “Why is Facebook’s e-commerce offering so disappointing?”

  1. “Will you be successful in selling an item to a group of people sitting in a bar enjoying a beer relishing their old friendship days?”. Nope, it needs a different technique which facebook needs to discover.

  2. This article about Facebook not being a place to make a purchase is dead on. I have said this for years, but had to be less vocal because I was involved with a company that touted FB as the second coming of ecommerce. The article has two major points:

    1. The FB ecommerce process is user hostile. Users are forced to do a FB sign-in and the shopping cart sign-in. Want a contrast, look at how easy Amazon shopping is. Goodness, sign up for any half way decent payment gateway and you’ll get sample code in your language of choice that makes purchasing as seamless as possible.

    2. People just don’t go to Social Media sites to shop. They go there to socialize. That’s also why media purchases, like for a movie over the coming weekend, is successful. That’s a truly social event.

    As pointed out in a comment on the article FB is good for branding/awareness at the beginning of the sales funnel and at the end, for post sales support. But that’s too hard to explain to Wall Street when it comes to evaluation.

    If FB did a proper ecommerce API item one would be solved and companies could than get creative about item 2.

  3. Erica Ayotte

    I think the problem lies in trying to force Facebook into direct response model. Users don’t approach the platform with that kind of mindset. Facebook and it’s advertisers would do better to utilize Facebook at the top and bottom of the marketing “funnel” to use traditional speak. Meaning they should user Facebook to get share of attention/interest of prospects AND use it as an customer retention tool. But Facebook just may not be in that middle zone where the transaction occurs. If anything we should be focused on “p-commerce” — Pinterest commerce because that is a platform that consumers approach with a shopping mindset. And there’s already quite a bit of data supporting Pinterest as a better direct response/buy platform than Facebook.

  4. You can shop from Facebook? I get ticked off that ads are in my news feed when I am just sporadically checking in to see if my friends posted anything interesting or if instead it’s a night my one friend has flooded the news feed with lovely shoes that she wants to buy someday, which I promptly pass over being content with sneakers and not into women’s shoes…..

  5. One thing often people and businesses miss is that Facebook was conceived, built and will be a time-passer platform. No one serious will ever look at the ads or go do a buy/business deal. In many time as a facebook user, I hardly recall even once if I have paid attention to any of those ads.

    Added to the fact that Facebook is a closed eco-system, that means the global reach for content via search like in Google will not happen. So the content has a restricted and pre-defined (what Mark or Facebook thinks is right) exposure.

  6. Philip Rooke

    Every journalist who interviews me wants to know what success we have had on Facebook. It feels like you are not a real eCommerce business until you have worked out how to drive sales on Facebook. Or you not created anything special until you have made big sales on Facebook.

    All the great things we have done as a company around the world, with new ways of doing things and lots of success; 50% of the time get one question and followed straight afterwards with the Facebook question.

    I joke that successful eCommerce on Facebook coverage online is like the endless hunt for UFO’s & Ancient Aliens. There are thousands of blogs, articles and videos all talking about it but no one can prove anything.

  7. Dennis O'Malley

    Storytelling is the best selling and Facebook does a great job of letting people tell their stories. e-Commerce sites are great for product details and purchases. At ReadyPulse we have seen successful brands move Facebook to e-commerce, but not e-commerce to Facebook. Imagine your current e-commerce stores with elegant customer and fan stories, that are more authentic, visual, and interactive than text based, in authentic reviews.

  8. Michael Sinsheimer

    They may have a context issue meaning people don’t come to Facebook to shop – they go to swap stories and photos so altering the behavior is difficult. We are working hard on social commerce at Flash Purchase where sharing deals drives better bargains. It’s early and we are in beta.

  9. Chris Gutknecht

    The typical product discovery is through search. I don’t think Facebook’s new search functionality will ever rival Google (for commercial intent searches) like Amazon does. If friends show me a product, I couldn’t imagine the product being shown on Facebook. The last glimmer of hope might be retargeting through the new FBX, yet that would make FB an ad network with no shopping experience of its own. So, same verdict, FB will imho not work as a marketplace.

  10. Douglas Crets

    I don’t think Facebook is ever the right forum for sales, for two reasons:

    The structure of the platform forbids a culture of commerce acceptance. People don’t use it for that, and they don’t want to, and Facebook will not make any changes — that I can foresee — that will suddenly make Facebook a shop window.

    Facebook fills a gap in another fragmentation problem, media dialogue or the public square. Facebook is a culture creator. you can take disparate peoples (if you can find them) and create a connection with them through values, moods and emotions.

    Facebook is really more like a media platform that uses real time feelings and emotions to relay ideas and beliefs about a product. It’s a primer, or a catalyst, not the place to do the shopping.

    I know that sucks for brands. I run Facebook communities for a brand myself. But brands have to get used to a completely different way of creating marketing. The new form is a relay switch, rather than a broadcast platform. What happens in Facebook can be taken as Business intelligence and used for marketing in other scenarios.