How we buy things on the Internet has undergone a giant transformation from the early days of e-commerce. While companies like Amazon and PayPal were some of the original pioneers in this space, group-buying outfits like Groupon and Living Social have started to take online shopping in new directions. But we could be on the cusp of a new revolution in F-commerce – or social commerce – and Millennials will likely be at the forefront of the charge.
A new report from JWT outlines the potential for Facebook-based commerce and predicts this could be particularly attractive for Millennials. A total of 4 in 10 Millennials who were surveyed expressed a desire to see more opportunities to shop within Facebook, compared to only 26% of Gen X-ers and 16% of Boomers. But perhaps more telling was that almost 50% of Millennials reported that since they already spend so much of their online time on Facebook, it was a natural extension to shop their too.
Despite the convenience factor – which is clearly important – the opportunity to personalise the shopping experience using social data is certainly something Millennials would find attractive. Amazon has built an incredible recommendation engine using the data it collects from its users and – as somebody who uses Amazon regularly – I always find its product recommendations extremely helpful. But Amazon is building its recommendations on behavioural and transactional data. It knows the types of products I’ve been browsing and also what people who were browsing for similar products ultimately purchased, and can thus create a fairly targeted experience. But social commerce can take this concept one step further by tapping-in to a user’s social graph to help them discover products via their trusted network of friends.
Perhaps the whole point of Facebook is that it rejects the notion of a homogeneous Web. Its vision is that an optimal digital experience should be highly personalised to the individual and should – in a frictionless fashion – learn about each individual the more they engage with the Facebook platform. We’re already seeing curatorial platforms like Pinterest emerge that allow people who are part of the same network to surface interesting finds. A personal recommendation from somebody you know will always be more powerful than something generated by an algorithm.
For Millennials, personalisation is a critical part of any digital experience as long as it’s either useful or entertaining. This group of people is becoming increasingly sophisticated at filtering through marketing messages and background noise to get to what they want. Remember, Millennials were the first generation to grow up in this era of information overload and they’re well equipped to deal with the deluge of content that bombards them on a daily basis. So personalisation is actually a mechanism to help Millennials achieve this. By only receiving content and information that’s well targeted or recommended by friends, it takes some of the leg work out of cutting through the clutter.
How we pay for products is also going through somewhat of a transformation. For the longest time credit card payments dominated the e-commerce landscape. But more recently PayPal has become integrated into a rapidly growing number of big-name shopping sites and innovations such as Square are promising a further shake-up in how we transact. Facebook already has its own credits system which users can spend to unlock new features in certain social games. So with a payment system already in place, it seems to make logical sense that Facebook could easily extend its credits system to be used to buy products from a Facebook-based store.
While a number of brands are already selling products within Facebook, the social commerce space is still in its infancy. But for brands looking to sell directly to Millennials, this is a platform that seems ripe to exploit. Offering a personalised shopping experience within an environment that Millennials already spend a huge amount of time is an incredible opportunity, and one that will continue to grow as customers’ social graphs deepen and mature.