Facebook commerce slow to gain ground

21 February 2012

NEW YORK: Brand owners are still yet to establish how Facebook can be used to drive direct product sales, with Procter & Gamble, Reckitt Benckiser and Netflix among the firms testing new models.

Procter & Gamble, the consumer goods group, has linked various Facebook brand pages to a range of different online retail platforms, such as those run by firms including Amazon, Off the Wall and PFS Web.

"We are still learning. We don't have the solution. We are testing this with various brands. If you ask me 'Are the numbers significant?' the answer is no," Alex Tosolini, VP, e-business, at Procter & Gamble, told the Financial Times. "The question is 'Is it a viable proposition?' The consumer decides."

A more definitive advantage of embracing platforms like Facebook, Tosolini argued, was that they offered a "one-to-one" connection with consumers.

"The future is going back to the past. Our grandparents had a very personal experience with the local store, the butcher, the baker. The human need is the same," he said.

Elsewhere, Reckitt Benckiser, the household goods manufacturer, has introduced a brand extension to its Cillit Bang cleaning line, called All in 1 Dish & Surface, which is solely available via Facebook.

According to Stefan Gaa, marketing director of Reckitt Benckiser, this effort "allows us to interact intimately with our target market, getting almost instant feedback."

Rakesh Kapoor, CEO of Reckitt Benckiser, added that a lack of clarity remained present: "Our industry needs to figure out how technology could shape our industry in the future. I don't think we have that brilliant an idea of how it's going to happen.”

Netflix, the online streaming service, has established a formal tie-up with Facebook, allowing its customers in Latin America and Canada to watch films from the social network, but even here the precise benefits have not been easy to identify.

"There's no direct measurement that we're able to do on our success in all of our international markets, how much of that is due to Facebook and social integration," said Reed Hastings, Netflix's CEO.

"We can't tell if this success is because of our brilliant advertising or because of our Facebook integration ... So instead, what we look at is engagement: how do we get people to enjoy it more, use it more, click on more of the stories [and] watch movies."

Gamestop, JC Penney and Nordstrom are among the other major operators which have opened stores on Facebook in the last 12 months, only to close them down again aftewards.

Gap was also among this group, but found shoppers preferred buying from its branded sites. "We will continue to evaluate if this is something we want to bring back in the future," Liz Nunan, a Gap spokeswoman, said.

Data sourced from Financial Times, Reuters, Bloomberg; additional content by Warc staff