is testing a buy button for advertisers. If you've seen it in
your feed, you're lucky; currently it has been rolled out to only
a limited number of medium-sized U.S. businesses. Limited reach
or not, however, it is the first major move Facebook has made
toward e-commerce. Does Facebook plan to cross paths with
Here's how the latest Facebook button may appear in your
Facebook is testing a buy button. Image source: Facebook.
Quick to silence any potential headlines that could have read,
"Facebook is sharing your credit card information with
advertisers," the company said it is taking privacy seriously
with its buy button:
We've built this feature with privacy in mind, and have
taken steps to help make the payment experience safe and
secure. None of the credit or debit card information people
share with Facebook when completing a transaction will be
shared with other advertisers, and people can select whether or
not they'd like to save payment information for future
With the privacy issue out of the way, the next big question
is this ...
Is it a new strategy?
E-commerce is a big market. Naturally, investors would want to
know whether a buy button signals that Facebook may be
considering a strategy to compete with the great e-commerce giant
that is Amazon. So it wasn't surprising when the subject surfaced
during the social network's earnings call last week.
analyst Douglas Anmuth brought up the subject.
"There's been talk, Anmuth explained, "about testing a buy
button. ... I was hoping you could talk about how important you
think commerce is to Facebook going forward and then perhaps also
payments as well."
Facebook CEO Mark Zuckerberg (right) in his conference
But Facebook is still an advertising business, Facebook CEO
Mark Zuckerberg and COO Sheryl Sandberg explained.
"No one's buying from us," Sandberg emphasized. "We're just
streamlining the process of buying from our clients. I think
commerce is really important and is a growing important part of
our business, as all marketer segments are growing, but I don't
think people should confuse that with Facebook selling things
On the flipside, Facebook may be teasing investors with a
preview of a larger emphasis on e-commerce in the future as a
middleman. Sandberg explained that a shift is, indeed,
The more people buy online, the more people buy things they
discover through their mobile phones, the more people discover
things from a News Feed and go on to purchase, the more
important we are in driving e-commerce, and I think we are
increasingly important. That doesn't mean we're going to or
have to sell products.
Interestingly, though, Zuckerberg went on to explain that he
doesn't see Facebook getting into the payments space, but rather
continuing to view others in the space as partners.
sees the opportunity as the middleman in e-commerce, too. The
company announced earlier this month that it acquired CardSpring,
a payments infrastructure company. And, unlike Facebook, Twitter
blatantly said it is working on "the future of commerce on
Twitter." The acquisition, Twitter said, would help the social
network bring "in-the-moment commerce experiences to our
And, for Twitter, there's more to come: "We'll have more
information on our commerce direction in the future."
Fancy -- a shopping app -- was even spotted with a buy button
on Twitter. Considering the wild price point listed, it was
surely an accident that the ad was leaked.
Did you see it ? The buy now button For Fancy and Nest spotted
- Media_Curator (@Media_Curator)
July 4, 2014
While Facebook and Twitter will almost certainly never sell
things directly, as Zuckerberg emphasized during the Q2 call,
they may try to increasingly promote in-platform purchases.
The move by Facebook and Twitter to offer in-platform
purchases shouldn't be thought of as entering the business of
selling things that Amazon is in. And while such a move would
definitely open up a new market to the social companies, it would
also be way out of their fields of expertise -- so it's probably
a good thing they will never try to be Amazon. And who wants to
try to compete with Amazon, anyway?
What the move
do, however, is add another layer to social advertising that
television marketing can't imitate (or at least not very
effectively). It is a powerful new ad product that promotes, as
Twitter said, an "in-the-moment commerce" opportunity.
Advertising and commerce all in one fell swoop! Sure, it's not
a move to face off with Amazon, but it is certainly a
game-changer in the digital ad business.
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A Buy Button? Is Facebook, Inc. Aiming to Compete
originally appeared on Fool.com.
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