Facebook E-Commerce: What Online Retailers Have Been Looking For?

Facebook has over 400 million active users. In the U.S. Facebook surpassed Google as the...
Facebook E-Commerce: What Online Retailers Have Been Looking For?
Written by Chris Crum
  • Facebook has over 400 million active users. In the U.S. Facebook surpassed Google as the top site about a week and a half ago in terms of visits for a week. Consider that consumers are getting more comfortable with online shopping from their mobile device, and that social media (at least in significant part), is driving mobile usage. Shopping from Facebook may just be a matter of convenience. Users will often be signed in already. On top of all that, a recent study found that brands on Facebook and Twitter are actually favored by consumers.

    Can product listings on Facebook increase sales?
    Share your thoughts.

    Imagine if you were able to get a customer as a fan, and penetrate their Facebook newsfeed, where they’re already spending more and more of their time. Then imagine that if if they click through to your page based on an update from you they found interesting, they were able to purchase goods from you right there. That would be pretty powerful. Well, you don’t really have to imagine it anymore. Facebook’s value as a powerful e-commerce driving tool is pretty much here now. It’s no longer only about engaging with customers and fans, customer service, and branding for businesses. It’s become much more than that. Businesses can use Facebook to get people to directly drive online purchases.

    This has quickly been becoming a fact over the past year or so. It wasn’t that long ago when Facebook’s virtual currency was first supported for purchases of physical goods. Now we’re seeing more initiatives and apps finding their way into the news feed that let users buy stuff. In October, Payvment launched storefronts on Facebook via a PayPal API.  In December, PayPal introduced its own "send money" Facebook app. Just yesterday, E-commerce software provider BigCommerce launched a Facebook app called SocialShop, which lets businesses sell good from their Facebook pages. 

    Businesses simply buy into one of the company’s packages at varying prices for different amounts of product listings, staff logins, bandwidth and storage (each comes with an AdWords credit), then create a Facebook Fan page (if they don’t already have one), add the SocialShop application, choose the page they want it to appear on, add a shop tab to the page, add their store link, choose the products they want to show, and that’s about it. Now customers can visit the fan page, click on "shop" and do just that. When they click on products, they will be taken to the store. Back on Facebook, they can click a "share" button under any product to pass it along to their friends, if they so choose.

    It’s probably safe to assume we’re going to see an increasing number of Facebook apps catering to e-commerce businesses, which will drive Facebook’s growth as a shopping destination, and one that could be hugely beneficial for small businesses. The viral power of Facebook is something that such businesses have not really had easy access to in the past (remember – over 400 million users on a site dedicated to sharing stuff with friends).

    There is still the question, however, that the rise of e-commerce on Facebook could lead to an increasing amount of spammy updates from businesses, which could turn customers off. Add to this the growing impatience of many users over updates from various applications (think about how many of your friends play Farmville, Fishville, Mafia Wars, etc.), and Facebook runs the risk of becoming less appealing to users. Sure, it’s on top now, but that can always change. It wouldn’t be the first time.

    Just trying to keep things in perspective here. For now, there’s no sign that Facebook use is going to be coming to a halt anytime soon. Right now, it’s looking like there are a growing number of options for online businesses to take advantage of the web’s largest social network.

    Do you use Facebook to sell merchandise? What other applications have you used to accomplish this? Discuss here.

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