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That Facebook and Twitter dominate social media is no surprise. From introducing ad formats, to promoted posts for brands to engagement with consumers, the two have constantly worked to stay relevant to a restless digital population while successfully monetising the platform. Now they are looking to upgrade brands from plain vanilla engagement to actual sales and ROI (return on investment).
To this end, Facebook placed a 'buy' button in its news feed to test out consumer reaction in July this year. Twitter followed suit in September. The button essentially allows users to click on promotions/ads and make purchases from merchants on the social network itself, without having to navigate to another site. The only prerequisite? The user needs to enter her mailing address and payment information, post which buying products is just a click away.
While this is currently being tested out in the US and if it works, the idea will travel to markets like India in six months or so. Analysts say the 'buy' button is aimed to woo users with quick promotions and flash sales. A sales-driven feature such as the 'buy' button points at Facebook and Twitter's overlapping e-commerce ambitions. "The button cuts down one step and allows a user to make a purchase on the social network itself which could be hugely beneficial for FMCG brands and even e-commerce websites who are advertisers with Facebook," says Arashdeep Sandhu, senior manager, operations and research, MindShift Interactive. First-time innovative products that would like to be 'discovered' too stand to gain from the traffic on Facebook and Twitter.
Google has been at it for a while with something similar, the Google Shopping Express, which allows ads to turn into purchase mechanisms. "As things stand, Twitter I would say is the most expensive social platform for advertising, allowing for targeting only of the demographic kind, and not geographic yet," says Sandhu. "Facebook allows for city-specific targeting."
The two internet giants are hoping to drive impulse purchases with this feature. But there could be roadblocks. First, users are generally hesitant to share payment details on open platforms. Tackling payment-related apprehensions will be crucial. Second, the 'buy' function could eat into a user's social networking time, which could prove a nuisance to some, even as others may view it as a bonus feature.
The game changer could well be how well a brand customises its offers to suit a user's social networking and buying behaviour. Another important aspect could be how e-commerce giants can create exclusive deals for social media. Different brands could target different social networks depending on the profile of the user. Facebook could also help online retailers get rid of the nightmare of dealing with unfinished checkouts by 'following up' with the user on such incomplete purchase baskets. This is easier for a social network because, at least in theory, it has better analytics strengths to understand the online behaviours of its users.
Facebook in particular faced a lot of scepticism when it first launched ads as part of its news feed a few years ago. But the move involved highly targeted ads asking users to 'like' a brand or possibly, click on it to be taken to the brand's webpage, which users didn't particularly mind. They always had the option of 'muting' an ad that bothered them. In any case, for some users, it was like following the herd when they 'liked' an ad or a brand if their friends had also 'liked' it.
Can the same logic work for the 'buy' button? Will users feel compelled to buy what their friends are purchasing on social networks? In other words, can Facebook or Twitter also become retail stores like Apple (with iTunes) or Google (with the Shopping Express)?
We will have our answers in a few months.
