F-commerce became a popular marketing buzzword last year, as brands set up online stores on Facebook to sell physical goods. But have stores grasped f-commerce yet or is there a long way to go before social selling succeeds as a business model? Anton Gething, co-founder and product director at nToklo, takes a closer look.
Facebook commerce is dead or, at least, its days are starting to look numbered. Until last week, f-commerce appeared to be a quick and easy answer for brands and online retailers looking for a swift entry into the increasingly popular world of social commerce (s-commerce).
However, the recent announcement that Gap, J.C. Penney, and Gamestop, amongst other retail brands, are closing their respective Facebook stores begs the question – if the largest social network and some of the biggest brands can’t make f-commerce work, how can smaller retailers and brands be expected to succeed?
So, with huge brands showing their dissatisfaction with the value of a Facebook store, what are the alternatives for brands and retailers looking for a way in to social commerce?
Please find some comment below from Anton Gething, Co-founder & Product Director at nToklo, the social commerce and recommendations experts:
S-commerce is something often discussed as a natural progression of two successful market arenas – social networking and e-commerce. However, with forays into s-commerce to date amounting to little more than adding a ‘Like’ button or setting up a Twitter feed, the evidence suggests that it’s not yet the sum of its parts. When Facebook launched its marketplace, offering retailers and brands a storefront on the social network, many heralded the beginning of Facebook commerce. However its underwhelming adoption and the recent announcements that Gap, J.C. Penney, and Gamestop, amongst others, are closing their Facebook stores, it begs the question that, if big brands have lost faith in f-commerce, then who can make it work?
“There are an increasing number of examples to illustrate the fact that f-commerce runs the risk of brands and retailers becoming a ‘dumb pipe’. Extrapolating the f-commerce model – if clothing manufacturers continue to try and sell their products through Facebook stores, the consumer quickly becomes used to engaging with Facebook to make their purchase, without having any meaningful contact with the brand that they are buying from. It is this approach that could lead to brands and retailers losing all of their brand relationships online – driving customers to a virtual mall and away from the brand itself. This goes against the original goal of using Facebook as part of your s-commerce strategy in the first place. In addition, retailers run the risk of becoming beholden to the likes of Facebook for their online presence and brand engagement – a very risky business model.
“While f-commerce launched with a bang, we have been saying for some time that this approach will only have short term success. F-commerce is not a recipe for long-term success in the world of s-commerce, which arguably has the potential to be one of the biggest revenue generators for retailers in the coming years. To be successful, s-commerce must put the consumers first and content second, providing the social engagement features with their brand and consumers throughout the shopping experience. Done correctly, s-commerce could be very powerful, not to mention profitable, and will breed brand trust and shopping confidence. One thing is for sure though, recent departures from the f-commerce landscape signals a lack of faith in the Facebook offering.”
By Anton Gething
Co-founder & Product Director
nToklo
www.ntoklo.com/
19 Comments
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Are their any F commerce models that are working? what about ASOS?
Personally i think the F commerce model that will work the best is to leverage the open graph and FB connect, so you take your social network with you to traditional Online stores.
Amazon have done this in the US, but again is there any evidence that this is increasing sales?
I find this interesting, but I have to dis-agree with your comments about smaller retailers/brands not being expected to succeed because the giants the likes of Gap and J.C. Penny’s can’t make it work…
I am a small brand, my shop is just me, making hand-crafted items, and facebook is probably my most successful online platform for selling, not necessarily through my “facebook shop” app (I use Payvment) but certainly through my business page, most of my commissions shown on my business page are orders I have received through contacts on my business page on facebook.
Personally, if I wanted to shop from GAP online, I would look for their own website, NOT their facebook page, it wouldn’t even occur to me that they may have a facebook page, however, if I am looking for a quirky little handmade gift, I would, and do, trawl through the facebook pages using a relevant search (for instance Polymer Clay fairies, or sock beasts)…
I don’t believe that facebook is the right place for the giants of business, they have their own brand awareness and successful websites – facebook is invaluable to the little guys, like me, who aren’t well known, but want to be 😉 Word of mouth spreads quickly on Facebook, and I regularly get new “likers” to my page from others that have already found me and fallen in love with what I do 😀
Hi Nikki, thank you for your comment.
You highlight a very interesting point that I’m very much in agreement with. When it comes to social commerce, there is no ‘one size fits all’ solution. There are a number of factors that count in s-commerce, not least of all the size of company, the type of merchandise, target audience, and the ‘social element’ of the retail content.
The point I was making is twofold. Firstly, social commerce does not necessarily equal social media. It sounds to me like Facebook offers a valuable social media platform for your business within the ‘social information highway’, as, for example, a blog might. This is great, but as you point out, your sales do not occur on your Facebook site.
Secondly, I am concerned for the future of small businesses such as yours becoming beholden to Facebook. At some point in the future should Facebook chose to monetize the marketplace, this could directly cut in to your bottom line, hence my caution on the longer term potential.
There is a difference between social media and social commerce, the former forming a valuable component of the latter. I believe so much more should be done with social commerce within the retail site, while certainly, benefitting from social media as you’ve described.
Hi Jon
You ask a very good question. One of the key elements around f-commerce and social commerce for that matter is how its benefits can be calculated. This is particularly true of retailers, where the historical retail ecosystem model and the drive for increased ARPU and ROI form the basis of most measurements. For this reason I think many retailers are pulling back or questioning the value of social media initiatives. Social commerce though is different and executed correctly can show real, measurable value.
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