F-Commerce Lessons from Facebook’s Growing Movie Rental Library

So the embryonic and experimental Facebook movie rental service by Warner Bros now includes Batman: The Dark Knight, Harry Potter movies (Sorcerer’s Stone, Chamber of Secrets), Inception, Yogi Bear and Life as We Know It.

Fans can rent a film for 48 hours (alas not 488 hours as VentureBeat reports), paying with 30 Facebook Credits ($3), courtesy of Milyoni-powered software, and have full control of it in terms of pausing, rewinding, fast forwarding and resuming. They can also post comments on the movie, interact with friends as they watch, and update their status.

As proof of concept that Facebook could have a future as a premium digital distribution platform – it’s brilliant, and sent Netflix shares tumbling.

But it’s just a start. We think critical success factors for Facebook movie rentals will be

• a) exclusive fan-content, and
• b) fan-first timing

And that is precisely what Warner Bros has done, creating a Limited Edition Harry Potter Blu-ray exclusively for fans. Kudos – this is gold-standard ‘fan-first marketing‘ (but why in Hogwarts isn’t it available for streaming? Blu-Ray is so noughties).

But the principle is spot-on.  Why?  In a word, word-of-mouth.  And why word-of-mouth? Word-of-mouth recommendations drive movie sales.

[blockquote]This article uses actual word-of-mouth (WOM) information to examine the dynamic patterns of WOM and how it helps explain box office revenue. The WOM data were collected from the Yahoo Movies Web site. The results show that WOM activities are the most active during a movie’s prerelease and opening week and that movie audiences tend to hold relatively high expectations before release but become more critical in the opening week. More important, WOM information offers significant explanatory power for both aggregate and weekly box office revenue, especially in the early weeks after a movie opens.[/blockquote] Yong Liu: Word of Mouth for Movies: Its Dynamics and Impact on Box Office Revenue

And we know from empirical research that exclusivity drives word of mouth.  For instance, one of P&G’s 3 word of mouth activators is ‘Get it First‘ (the other two being “Inside Scoop” and “VIP vote” (letting fans have a say in your business)). So offer fans exclusivity, and fans will pay you back with word of mouth recommendations.

For Warner, this means that whilst fan-only content is great, fan-first content would be better, because it would drive word of mouth sales for Warner as well as lock in fans to the franchise.

Of course, fan-first marketing may not be possible, so in these cases, fan-extras might work – the regular product bundled with added fan-goodness – Facebook interviews with director and cast, special out-takes, Facebook games, even fan-only movie-merchandise.

But what does all this movie-talk have to do with f-commerce in general?  Well, our opinion is that Facebook movie rentals illustrates where the real opportunity in f-commerce may lie – whatever you are selling.  Specifically, Facebook has huge potential as product seeding channel; selling to fans and activating revenue-generating advocacy.  If you take the view, as we do, that Facebook is people-media mediated by word of mouth, then f-commerce and word of mouth make a compelling combo.

We’d go so far as to say, if you’re not offering fan-first or fan-only exclusives not available elsewhere on Facebook, don’t bother with f-commerce – because you’ll be missing the point – and the sales.  Rock-on Warner.