Facebook and Twitter to enter the world of eCommerce.

Who is surprised that Facebook and Twitter are working on entering the world of eCommerce? We’re not.

As technology and social media platforms become increasingly ubiquitous to our daily lives, it’s no surprise that Facebook and Twitter are working on offering in-app purchases to users. Why leave the comfort of Facebook or Twitter to go shopping online when you could just buy what you like within the apps?

Yeah, so?

The decision for Twitter and Facebook to include in-app shopping raise questions about exactly who will benefit? While convenience is a strong factor for users, what do businesses get out of it? And ultimately, what’s in it for Facebook and Twitter? Answers may come in time, but it will be interesting to see how users respond to this new functionality.

The timing is curious around both Twitter and Facebook’s announcements – perhaps coincidental, perhaps serendipitous. Either way, it’s clear that it will have a ripple effect on other social media channels in the future.

The Twitter-sphere

In mid-July, Facebook announced that it was testing a ‘buy’ button on its platform.

Merely hours later, Twitter announced its purchase of Cardspring, a company with a payments infrastructure platform that enables users to connect online with offline promotions.

Android users of Twitter were the first to notice eCommerce rumblings when they found a ‘Payments & Shipping’ menu item in the app. At present, the feature is not functional. However, Twitter stated when announcing Cardspring that its goal was to bring ‘in-the-moment commerce experiences to our users’. Prior to this announcement, Twitter been vocal about finding ways to embrace eCommerce. The hiring of former president of Ticketmaster, Nathan Hubbard, as the new Head of Commerce confirmed it was taking this approach.

At the time of writing, there have been no further updates from Twitter. with the Christmas shopping frenzy just months away however, one would think we may see something soon.

Facebook

When Facebook announced it was testing a ‘buy’ button, marketers around the world became giddy with excitement. Think about all the possibilities this button would create for retailers. It signalled a change – Facebook was about to become a major player in direct response advertising.

When Facebook became a public company, one central question that lingered in the air. Just how would they be able to achieve ROI for its shareholders? The ‘buy’ button is a way for Facebook to do this and they are pushing hard to make it happen.

The ‘buy’ button works by allowing users to see a product advertisement in their Facebook feed, click ‘buy’ within the advertisement and complete the entire transaction within the platform. That’s right. No redirecting to external pages and no leaving the comfort of the app.

The process is simple. Once a user has chosen to buy the item, they only have to move through three screens – shipping, payment and check out – to complete their purchase. The functionality throws up questions around Facebook collecting even more personal data from users, such as credit card information.

What else are they planning? However, before we get too ahead of ourselves with theories and questions, it’s worth keeping in mind that testing is only a month or so old and no real public feedback has been announced. Watch this space!

The ‘buy’ button is different from Facebook Gifts (or Facebook Credits) which enabled users to purchase gifts for others while in Facebook. It was a concept that never took off.

While Facebook currently accepts payments for games and apps, there is currently no functionality for users to buy products or ‘go shopping’ within Facebook.

In true Facebook style, only one business, Modify Watches, is confirmed for testing. The press has speculated others but nothing has been confirmed.

The ‘buy’ button allows Facebook to leverage a space they ‘own’: mobile. Being able to buy on a mobile device within Facebook, will undoubtedly create more mobile conversions for Facebook. It’s their ideal user; the social consumer.

From a brand perspective, there are some great opportunities with this functionality. Agencies have the chance to sink their teeth into creative campaigns utilising this feature. While advertisers could purchase bigger campaigns within Facebook and flood our news feeds with encouragement to buy the latest sneakers or chocolate bar, the ‘buy’ button may instead provide a direct avenue for brands that would help them demonstrate an ROI for social media.

For example, brands could try out a new product line solely on Facebook or target a certain product line to a specific demographic just to see how it performs.

Ultimately, Facebook must be interested in collecting a ‘clip of the ticket’. Whether through payment fees or revenue share, it would finally demonstrate a ROI to its shareholders.

What does the future hold?

We think it’s unlikely that Twitter and Facebook will attempt to become a full shopping network like Amazon. The types of functionality they are currently working on may change their users’ behaviours when accessing the social networks. Will it demonstrate strong loyalty to the platforms? Only time will tell.

One thing is clear. Social media and eCommerce are becoming increasingly entwined. Just how many online channels do we need in order to buy stuff? The public feedback on Twitter and Facebook’s initiatives are key to determining whether there is a demand for this functionality and whether we want a social media conduit for eCommerce.