Social commerce strategies

The story

Wishbuuk is a Facebook application which was created after Fnac, the French books and music retailer, approached Flash2Flash digital, a marketing agency, for help introducing its brand into social networks. While marketing agencies such as Flash2Flash have helped brands create Facebook fan pages to attract followers, converting these followers into customers has proved difficult. Social commerce – using social media to buy products – is forecast to become a $30bn sector worldwide by 2015.

The challenge

Social networks are considered a “private” space and when brands start invading this space, users can reject both the brand and the social network. Brands feel alienated from social media, but at the same time cannot let a potential market of 1bn Facebook users slip by.

Facebook’s value to brands hinges on its members’ engagement. One of its main assets is its platform, a software environment enabling third-party developers to create applications that take advantage of the network’s users and data, often directing them to external sites. But Facebook has also started to release a series of products, such as Facebook Gifts (a service to buy real gifts for friends), which means Facebook itself is becoming more like an ecommerce site – potentially harming brands using Facebook by cannibalising their sales.

The strategy

Flash2Flash felt the key would be finding a way to introduce brands subtly into social networks. To do this they hit on the idea of an innovative start-up called Wishbuuk. At its inception, Wishbuuk was an application consisting of a button on Fnac’s website, which made the wish list of potential customers visible on their Facebook profile. The simple strategy won Fnac positive results – it doubled the conversion rate of followers to customers. However, Wishbuuk also learnt another lesson from the pilot: the less the brand was involved the better the result.

This first test led to an unbranded platform where Wishbuuk could replicate its success with other retailers – becoming a social recommendation platform built inside Facebook, allowing users to create and share lists of their favourite products from any ecommerce site in the world. Based on the notion that personal recommendations for products have worked for years and just needed to be adapted for social media, Wishbuuk also served as a platform where people thinking of buying a certain product could look for the opinion or recommendation of people they trust, such as friends or family.

Wishbuuk also remained bullish about being an application exclusively inside Facebook, reasoning that the visibility Facebook can offer brands’ products – whether via its Timeline, News feeds, Ticker or Notifications – is pretty much unequalled. This act of confidence despite Facebook potentially stepping on its toes with the release of new products such as Facebook Gifts came with a conviction: it was crucial that Wishbuuk preserved users’ freedom of choice. Developers such as Wishbuuk did not force a particular brand or product upon Facebook users; it was always up to the users to recommend and choose. Users seem to approve of this stance: more than 30 per cent of daily users redirect from Wishbuuk to a given ecommerce site.

The lessons

The case demonstrates the need for brands to think carefully about how they are perceived and to adapt to how they communicate to customers depending on the platform they are using. In social networks, where personal relationships are key, it is important for users not to have the impression they are being sold something.

Second, possibly the best insurance for developers against any attempt by Facebook to introduce new ways of monetisation that may harm their business is to protect and nurture their users. Brands must keep in mind that it is the users and not the social network itself that decide whether content is valuable or not – or whether a brand’s product deserves their attention or purchase.

By José Luis Nueno. 

Article published in Financial Times. May 27, 2013

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