Social Commerce

What's Your Facebook eCommerce Strategy?

Just incase anyone was wondering if Facebook was serious about transforming itself into a social commerce platform, the world’s favourite social networking platform is on a recruitment drive to recruit a team of Payment Operations Strategists and Analysts (more here):

“Facebook Payment Operations is a brand-new team that ensures, monitors, and reports on all money moving into Facebook. As a founding member, individuals have an opportunity to shape this team’s culture, role within the company, and day-to-day operations. As part of the Online Operations organization, we work cross-functionally with the Product and Engineering teams to design tools and systems to serve our hundreds of millions of users and our ever-growing base of advertisers. Projects driven by Payment Operations team members will potentially contribute millions of dollars to Facebook’s business, as well as enable the company to scale and expand its operations in the coming years. Successful candidates for this job are self-motivated, flexible to constant changes and are problem-solvers who think creatively and propose solutions.”

Whilst eCommerce in Facebook is not new, with third party solutions already offering Facebook storefronts and Facebook stores embedded in Facebook pages and now even in Facebook newsfeeds, what has been missing is a seamless integrated payment system.  It’s coming.  Along with Facebook Connect, that offers portable social graphs to third party eCommerce sites (easy login, ask your network, share with your network), Facebook Payments is transforming the social networking site into a veritable social commerce platform.  Imagine a Facebook Connect version of Amazon’s PayPhrase, that allows people to login and pay with their Amazon [Facebook] account details on third party sites…

Once Facebook Payments happens, I think we’ll see the big two online retail giants, iTunes and Amazon, start reconsidering their hitherto cold shoulder treatment of Facebook.

So if you are in social commerce in 2010, we recommend you ask yourself a simple question.  What’s my Facebook eCommerce strategy?

Chartered psychologist specialising in consumer behaviour, wellbeing and technology. Certified CX professional experienced in Design Thinking. A researcher, writer and speaker, Paul is head of Digital Insight at SYZYGY.

17 Comments Add New Comment

  1. Hey Paul!
    Very interesting issue you have covered here.
    I suppose a universal payment system on facebook is a must not an option. Performance of facebook has in recent months been fairly poor from time to time, so an additonal source of income would certainly help cover the enormous maintenance costs and hopefully improve performance. Just as back in the days when fb was a really lean social community. I keep wondering if maybe fb is not growing at too fast a pace sometimes…
    But you are perfectly right that commerce will have to go where the potential buyers are – either in terms of ad placements or cleverly integrated into portals. And I am also dead sure that Amazon will (have to) move closer to facebook. At the end of the day people want convenience. Why leave your web 2.0 home facebook to go shopping at or elsewhere with all the numerous different bookmarks, logins,.. Instead, you could stay among your peers and even virtually shop together. This is actually what many of us already do using online stores and discussing products via MSN and Skype.
    If you ask me, that will be the next step. eCommerce will be social just as in real life.

    1. Hi Sven, thanks for your comment, couldn’t agree more, and good point on convenience – convenience is key. It’s interesting how people are willing to trade (perhaps unwittingly) privacy for convenience with FB Connect. We’re lazy surfers – the fewer clicks to transaction the better.

  2. I think the privacy concerns on FB are a big deal.

    I deactivated my account because I think Facebook has the look and feel of a food co-op but the company is preying on kids and adults with the warm and fuzzy look and feel.

    I think Facebook that isn’t driven by profit, that protects information about people and stops making it difficult to hide friends, to really finely tune how much info you give away would be useful.

    The Equator Coffee store has promise. But I won’t buy there stuff on FB because it is not trustworthy.

    FB wants to be trustworthy, but it breeches that trust unless you are an adolescent.

    It is simple: I want a FB that is a non profit, and is tightly regulated on information it uses and sells.

    Good luck with that!

  3. Paul –

    What are your thoughts on a customer affiliate marketing model via Facebook? Specifically what impact could a small number of brand loyal advocates have on a large community of individuals. Could this be a viable model via Facebook / Connect / Payments?


    1. David, thanks for the comment – ‘customer affiliate marketing’ model via Facebook: I think this is a *really* solid idea. If you look at one Europe’s biggest online success stories – much copied in the US (private shopping event site Vente-Privee which spawned clones like Gilt – they work on an exclusively on what is effectively an affiliate model (member get member). The company that launches a Gilt for Facebook will become very rich IMO.

      Avon are moving into Facebook – but the key to success IMO will be distance the proposition as far as possible from pyramid/network selling or even ‘affiliate’ programs.

      What do you think? Happy to chat if you’d like to PM me.

  4. Paul,


    I came across your site via a search and found it very informative. What is your view on what, if anything, developers can expect to pay per transaction fee to Facebook ? Some views is that it will be around 30%, similar to what Apple takes from developers who build apps for its iTunes App Store.

    This seems very high to me and I can see the logic of a much lower cut (or even zero) and for them to grow off the resulting advertising.

    Thanks, regards

    1. Hi Paul, thanks for the email. For transactions in Facebook Credits, yes Facebook is set to take 30%, but for PayPal purchases – by Pavyment for example, they take no commission whatsoever. Hope this helps.

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