Wednesday, March 7, 2012

Despite hiccups, successful Facebook commerce is just a matter of time

I recently posted this comment on RetailWire in a discussion of e-commerce sites on Facebook:
Any discussion of Facebook's affect on retail commerce needs to include the social marketing site's possible future as an actual locus of bona fide online shopping. Today Facebook serves as a marketing and customer service vehicle for most brands and retailers. But the company has made no secret of its desire to become a computing platform, an operating system essentially, just the same way that the web did. To realize this vision, one of the main things Facebook needs to conquer is to handle truly sensitive interactions entirely in its environment in a secure and trustworthy way. Online financial interactions (banking, securities trading, managing your retirement account, filing your taxes, etc.) and online retail are the two most obvious examples.
This isn't a small matter. Think about the truly transformative effect that the web had on retailing and related services. Remember travel agents? The internet killed them. Remember Tower Records? The internet killed it, too. And every consumer-facing retail segment in the world has been completely transformed by the world wide web. Facebook is going to throw its massive resources at this problem, and forward-thinking retailers will eagerly create storefronts to try and service the 850 million of us who visit Facebook every single day (although sometimes I suspect that 800 million of us are only there to play Words with Friends... ;-)
It's already started. There is a whole cohort of startups trying to provide robust online shopping and purchasing experiences in the Facebook environment. Surely they'll have their stumbling points, but just as surely they'll ultimately get it right. And when they do, Facebook will become that much more important to those who wish to sell their goods and services to the masses.
Shortly later I commented on a different discussion about some retailers closing their Facebook stores:
Don't confuse the tactical moves of specific retailers with the long term trend. Facebook as a platform is used by more than one sixth of the planet's population. That figure dwarfs the percentage of us who were internet-enabled back in 1995. Yet, at that time we didn't doubt the strength of e-commerce as a business model. The same will be true for Facebook storefronts.

There were winners and losers in the internet world as well. Remember when Yahoo supposedly had the search engine market all sewn up? That was before Google was even founded. Remember when was one of the biggest online retailers in the world? When's the last time you bought something on But just because some companies did better and some companies did worse, we don't doubt the trend.

The same will happen with commerce on Facebook. Big business there, waiting to happen. Maybe not for these individual companies, but that's not the point.

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