Selling on Facebook: 4 Common Issues

There is a growing integration between social media and ecommerce. And there’s a new term for this integration: social commerce.

Facebook is the leading social commerce platform. Recently I moderated “500 Million People and Growing: The Facebook Conversation Turns to Commerce,” a Practical Ecommerce webinar that addressed how merchants can tap into the Facebook phenomenon to help grow sales. Joining me in the webinar were representatives from Milyoni, a company that provides a Facebook shopping-cart application. We covered four topics:

1. Why online merchants should sell on Facebook.
2. Options for social commerce.
3. Why social commerce is not about selling.
4. Unique dynamics about selling within Facebook.

1. Why Sell on Facebook?

With more than 500 million users, over 50 percent of who log on at least once per day, Facebook is the leading social network. Not only that, earlier this year it surpassed Google as the most visited site.

Facebook brings in more than $630 million in revenue from advertising. Facebook fans spend $71.84 more annually on consumer products than do non-fans. They are 41 percent more likely to recommend products and 28 percent more likely to continue using them, according to Forbes magazine. As a result, ecommerce merchants should consider Facebook as a channel to expand their businesses.

2. Options For Social Commerce

Social commerce on Facebook tends to take three forms. They are:

1. Promote brand loyalty;
2. Drive fans to ecommerce websites;
3. Reshape the buying experience.

A number of Facebook shopping applications are little more than glorified photo galleries. That’s fine if the goal is to move the buyer from Facebook to the merchant’s ecommerce site.

However, there is a distinct disadvantage to using such an approach as consumers don’t typically want to leave Facebook to complete a purchase. For many, Facebook is the web and they prefer all interactions, even ecommerce, to take place entirely within the confines of that platform.

3. Why Social Commerce Is Not About Selling

Facebook is a social environment, not a shopping environment. Therefore, merchants should engage fans, not interrupt with over-the-top sales messages. The shopping experience needs to remain social, interactive, and contextual to the experience people are having.

That is not to suggest that, on occasion, it’s not okay to directly post a promotional message. But such behavior should be the exception rather than the rule. Educating, informing and entertaining fans is the guideline for what’s acceptable. Making sure there is a healthy balance between commerce-related updates and those that are simply informative is the key.

4. Unique Dynamics About Selling Within Facebook

Here are some keys to social shopping.

• Social Product Catalog. Shopping, and selling, within Facebook should be contextual in the sense that it has relevance to the shopper. Because Facebook provides information on the individual–gender, geo-location, likes, interests–merchants can create a storefront to take advantage of that. With the data from Facebook, it becomes almost like a personal shopper.

• Social Merchandising. Putting up a store within Facebook won’t guarantee sales. That’s because fans don’t typically venture too far off a Facebook Wall. By tastefully combining old-fashioned merchandising–the promotion and sale of goods–with social technology, merchants can reach out to fans via the Wall, initiate conversations, promote products, reward participation and bring them to the shopping cart.

• Secure Order Processing. Remaining within the Facebook environment is a big part of making the purchase experience more convenient. However, many merchants and consumers have questions about Facebook’s security and privacy.

  Each social commerce layer has its own rules on privacy and security. The first layer, Facebook, asks for certain information, such as birth date, gender, and interests, for the purpose of creating a social profile. Facebook-enabled storefronts can then use that information, saving the shopper from having to provide it again. The shopper should just have to supply product selection and shipping details to the storefront. The storefront then passes all of that information to the credit card payment gateway, which securely collects the credit card payment data.

  The key privacy and security concern is to ensure none of that information travels back upstream. Shopping cart vendors such as Milyoni allow the merchant to dictate which payment provider, such as PayPal, Authorize.Net and others, is used for the transaction.

Does It Make Money?

During the webinar, one of the greatest concerns expressed by attendees had to do with the return on investment from social media. Representatives from Milyoni shared the following facts:

• 40 percent of people become fans to receive discounts and promotions;
• 39 percent become fans to show their support for a brand.

By using good social merchandising manners, such as posting to engage with fans, make commerce secondary, pace your postings, and reward your fans with exclusive offers, merchants can make money off their Facebook efforts.

Conclusion

We ended the webinar by reminding attendees that:

• Social commerce is already here and Facebook plays a key role;
• Privacy and security can be effectively managed;
• To succeed on Facebook, merchants should remember that it’s not about shopping, but rather about engaging, informing and entertaining fans;
• Merchants should learn by doing, and experiment with a variety of options.

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