Years of thinking social archives >
Late last week, Facebook and Twitter both made news in the e-commerce space by announcing new functionalities to help users purchase goods from their platforms. Facebook has added a simple “Buy” button, while Twitter acquired a company that connects credit cards to buying actions. Both companies claimed that the new tools were more about improving the user experience, and less about making money – though that’s certainly the idea.
On Friday, Marketing Week cautioned brands to be wary of the announcements, arguing that neither move will generate meaningful revenue any time soon. I agree – Facebook and Twitter have a long way to go before this becomes a threat to any large retailer. First of all, the offering isn’t appealing to the top 20 advertisers on Facebook, including blue-chip companies like Coca-Cola, Unilever and Ford. No one is likely to impulse buy shampoo, a beverage or a car online. However, it could become a better option for the small to mid-sized companies who lack widespread distribution. For these businesses, using social platforms to connect with consumers who wouldn’t otherwise be aware of their products could provide beneficial. (Facebook and Twitter used Modify Watches and Fancy as examples.)
Even for smaller businesses, though, Facebook and Twitter overlooked a major consideration: the digital buying journey. When was the last time you purchased something without reading a review of it? Even at an offline location, 47% of consumers will use their phones to see reviews of a dress or a stereo or a movie before making a purchase (Source: eMarketer, June 2014).
If I have to leave Twitter or Facebook to find out more about the product, then I’m farther away from that coveted “Buy” button– and more likely to purchase the product through a different platform, or not at all.
The exception is products that consumers already understand. For example, popular online websites like Gilt stand to benefit. Imagine that you’re scrolling through your Facebook feed when you notice a pair of Prada heels that you love. Next to the image, you see a notification that the shoes are on sale – in fact, they’re only a click away. In this case, Facebook has helped you save a step, and beat the clock-watchers. That feels like a good experience – and the product itself is also expensive enough that a cut to Facebook isn’t a big loss to the retailer. (Unfortunately, I’m not sure Gilt is having any trouble selling those Prada shoes.)
This might also be a great opportunity for brands like Groupon or LivingSocial that rely heavily on email marketing. These companies bombard consumers with deals, even when they aren’t purposefully shopping. Facebook and Twitter could providean even easier point of purchase, and the single-step process makes the buying journey that much more convenient.
Whether selling stilettos or discounted tours of Napa Valley, Facebook and Twitter (and I suspect eventually Pinterest) need to figure out how to sell e-commerce services to their user bases (not just brands) in a way that isn’t disruptive. Perhaps then they will find greater, long-term success.
(Image source: http://mashable.com/)