“Like My Stuff” Chapter 1: Why Do Business on Facebook? (Part 2)

Like My Stuff Chapter 1 Why Do Business on Facebook (Part 2)

Facebook as a Marketing Funnel

Many businesses are investing resources into building a Facebook presence for their brand to engage with fans, advocates, ambassadors, press, influencers, and customers. The question for most businesses is how to move the page from just a PR and marketing awareness page—in the traditional marketing funnel—to a consideration and purchase page, thereby increasing the marketing conversion rates into solid, traceable sales.

A typical Facebook user spends a good part of their day on Facebook. And according to Compete.com, 68 percent of people become fans of retail pages to keep up to date on sales and promotions. So what’s the logic for a business to provide e-commerce on Facebook? Many businesses realize that if their fans are on Facebook to connect with family and friends and to engage with brands and receive coupons and deals, it may make sense to provide the ability for fans to purchase products, too.

In terms of real businesses today on Facebook, there is a wide range of how e-commerce is being handled. They range from Facebook shops selling items such as airline tickets, beauty products, baby products, clothes, and specialty BBQ sauces, to offering the ability to participate in charity donations and buy tickets for shows. Businesses are using the Wall as a shop “window” as well as to actively promote and purchase products on the shop tab itself.

To give you a good understanding of how companies are using f-commerce, the following chapters are packed full of practical examples. I’ve captured screenshots to illustrate how the brand uses Facebook and what the customer sees and can do. Having concrete examples helps to demonstrate the “how-to” part of using Facebook for e-commerce.

It’s highly recommended that you take the time to go online and click through the pages as you are reading the book. This will give you a more experiential feel for how brands use f-commerce. And note, some of the Facebook pages and stores may have changed by the time you are reading this book. That’s how fast things happen in the social networked world.

What’s the financial return for f-commerce? Some businesses are seeing as much as 20 percent of overall online sales coming via their Facebook stores as well as higher cart values as compared to traditional e-commerce venues. That in part may be due to the influence of friends, family, or colleagues and the recommendations that come from people they know, versus an unidentified stranger’s review on e-review or e-opinion sites.

Facts about F-commerce from SocialCommerceToday.com

  • Top 3: The top 3 brands on Facebook (by fans) all sell directly on Facebook—Coca-Cola (24m), Starbucks (20m), and Disney (19m)
  • 2–4%: f-store conversion rates—on a par with web-stores (avg. 3.4%, according to Forrester/Shop.org)
  • $650,000,000: The drop in Netflix share value when Warner opened up a Facebook movie rental (streaming) service in 2011
  • 1,000: Number of diapers P&G sold on its f-store in under an hour
  • 50,000: Number of retailers who have opened an f-store with Payment
  • 6 hours: Time it took for the Rachel Roy Facebook jewelry store to sell out
  • 3rd highest: daily sales made by Rachel Roy, the day it opened it’s pop-up f-store
  • 1m+: Starbucks customers using their e-commerce-enabled Facebook CRM loyalty program
  • 1,300: Number of products added every week to the ASOS f-store
  • 20%: Proportion of black Friday sales transactions on Facebook for e-tailer Kembrel
  • 7–10%: Increased Average Order Value for Facebook transactions (vs. web-store) for Kembrel
  • 5000+: customers using Walmart’s group-buy Facebook app on the day of its launch
  • $34: Amount paid for the first transaction ever to take place on Facebook at 11:50 a.m. EST on July 8, 2009 for bouquet of flowers ‘A Slice of Life’ on the f-store of U.S. florist 1-800 flowers
  • 76%: percentage of retailers who plan to use Facebook for ‘social commerce’ initiatives
  • 50%+: proportion of the global top 100 websites that have integrated with Facebook using its social plug-ins
  • 50,000+: Number of websites that integrated Facebook social plug-ins (incl. ‘Like’) in the week they launched
  • 2.5 million+: websites now integrated with Facebook
  • 10,000: number of new websites integrating with Facebook every day (with social plug-ins) since April 2010
  • 2m+: Number of sites that have integrated Facebook social plug-ins
  • 7 out of 10: proportion of digital marketers who have implemented or are planning to implement Facebook Like feature

Relevancy: Know Your Audience

Often understanding what is interesting and relevant is best found by asking customers directly. Too many PR, marketing, and advertising firms think they know better. They don’t take the time to do the account planning or research to really understand their audience, their behaviors, their motivations, and drivers let alone for traditional campaigns. Enter social media. If a brand does not listen and understand their online audience, the results can be devastating. That doesn’t mean a brand should not enter into the social media realm. It means they need to go back to school and understand the differences between online and offline customer interactions and the viral nature of a scorned customer.

Brands need to make sure they have someone on staff who understands how to do primary audience research in both social media and traditional methods. Qualitative and quantitative methods of traditional account planning and audience research include:Focus groups

  • In-depth interviews
  • Polls
  • Surveys, both on- and offline
  • Ethnography/netnography (observations off- and online of the audience behaviors)

Social media monitoring tools like Radian6, Sysomos, Tracckr, etc. lend themselves to account planning and audience research, especially for:

    • Primary Research (research conducted by the brand itself)
    • Sentiment and share of voice online
    • Identification of the top influencers, advocates, customers, brand naysayers, and press
    • Polls, surveys, and netnography
    • Topics influencers and advocates are discussing about the brand
    • Customer issues, questions, suggestions, and praise for the product, service, and the brand
    • Secondary Research (research conducted by other people than the brand)
    • Studies other research groups or institutions have produced on the brand or product category that the brand falls into (consumer products, automotive, etc.) and the customers associated with those groups.

In addition, conversations within online communities, either owned by the brand or third party communities, can reveal very interesting insights for the brand. Of particular interest to this book on f-commerce is the use of community applications within Facebook. An example of a community application used within Facebook is Get Satisfaction’s Facebook Solution.

Because the Wall in Facebook changes so quickly, brands end up answering the same questions over and over. The Get Satisfaction Facebook widget allows brands to not only avoid spending time repeating the same answers on the Wall (because questions and answers can be searched on and retrieved), but instead can focus on creating relevant content and interactions that engage customers to participate and make that brand part of their lifestream. I can’t stress how important creating interactions with your customers are. Facebook is not a website. It’s a social network where people socialize with each other and with brands. It’s not a broadcast medium where a brand can send out marketing messages. It’s a medium where customers go to exclusively to interact with each other and with brands.

Most social media monitoring tools can only provide Facebook data that is on public pages. Because of the partnership between GoodData and Get Satisfaction, the brand can obtain intimate knowledge of the conversations on their Facebook pages between the brand and its customer’s. And, if the brand has included the Get Satisfaction widget on their website or other communities, that data can also be aggregated.

If a brand doesn’t take the steps to understand their audience, there is no guarantee that the social shopping experience will yield good business results. Why guess, when you can know?


In the old days, marketers counted on a customer perhaps telling ten to twenty of their friends about a product or service. Today with the social web, one customer’s comment, negative or positive, informs thousands and sometimes millions of people. And reports show that year after year, consumers generally trust the opinions of people they know more than they trust anonymous ratings and reviews posted online. And in comparison, they trust online banner ads and advertisements even less. Social commerce or f-commerce is the opportunity to leverage word of mouth to increase the awareness of brand and drive customers through the consideration and purchase funnel.

Brands must begin to think from the social customer’s point of view. Customers who use social media are constantly being bombarded with invitations to new social networks. They have to decide where to spend the little free time they have. This means that a brand must provide their social customers direct engagement that acknowledges their understanding of their customers in the social web as well as reward them for that participation in the social experience created by the brand. Customers who do encounter great social experiences influence other customers. That influence can multiply across their social graphs and spark comments, conversations and purchases

I hope you’ll keep reading along with me! In the next chapter we’ll take a look at how f-commerce works.

You can order my complete e-book by clicking here.


Learn. Share. Grow!
@DrNatalie L. Petouhoff

For more info on my work:
:Social Media ROI

Social Media ROI YouTube Videos:
Video 1: Building the Business Case for Social Media
Video 2: How to Measure the ROI of Social Media

Video 3: How Social Media Benefits the Whole Company

Book on Monetizing Facebook: Like My Stuff: How To Monetize Your Facebook Fans

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