Friday, February 17, 2012

What's up with Facebook commerce?

So what's up with Facebook commerce?

In a word - nothing.
http://www.bloomberg.com/news/2012-02-17/f-commerce-trips-as-gap-to-penney-shut-facebook-stores-retail.html

And that my friends is why ZOOVY didn't waste any of our precious development resources on that tech, instead focusing on our other initiatives which will (hopefully) be bearing some fruit this year.

I'd like to take a moment and reflect on the first time I was introduced to commerce on Facebook. I was introduced to Payvment while they were the center feature on stage at the Paypal X-Developer conference in 2009. I had to wait in line for quite a while since he was being courted by what appeared to be every Venture Capitalist at the show.
I introduced myself and gave a 30 second pitch about what Zoovy does. I told him I had lots of merchants who would love use his software - and we'd deploy it next week if he could answer two key questions I had about his business that would help me understand how to position it to my clients. The questions:

#1. Why will people shop on Facebook - instead of a website or marketplace?
#2. I get that Payvment is free - but how does Payvment plan to make money, or at least what are some possible ways to monetize this since you're giving your software away.

The answers:
#1. People will shop because it's facebook basically they'll suffer through the inferior experience because it's facebook and it's cool.
#2. Payvment doesn't need to make money, VC's will just keep funding this (and he pointed at the line of guys in nice suits behind me were patiently waiting to invest in his company).

At this point I explained that while shoppers might overlook the security, they need a good experience for it be viable. Then I explained that at some point VC's appreciate a return on their investment, and the conversation that proceeded was less than useful. I pretty much wrote off the idea of Facebook commerce at that point.

I'm not discounting there might be some type of non-niche spiffy social shopping experience on facebook but I haven't seen it yet. I am also hopeful because our new web 5.0 shopping application will probably be how that social commerce experience is created.

2 comments:

Bill Brown said...

I don't really understand Facebook that much. Too many layers for me. We do have a fan page and we also thought we should have e-commerce on FB. Our thinking was that people would want to start each day at FB and so many folks seem to do that (my son being one). But, as time went on we realized that FB is not an important place to initiate a purchase. Most of our customers do what I do, start with a search or visit the last place they bought from (if they saved it). In my opinion Facebook is a good place to keep up with friends and family and if I see something they might like to hear about I just refer them to the companies' web site.

Josh Franklin said...

Hi Bill,

Great comment. Facebook is a perfect place to interact with potential customers and current and past customers. It was a good idea to take your FB storefront down for now, but don't give up on Facebook as a marketing channel. Have you seen the post about Facebook for eCommerce businesses ?