Online retail has exploded in the past decade, and more and more people are shopping from their mobile device than ever before. A recent article by Goldman Sachs made the prediction that mobile device consumer spending will rise from the 2014 annual average of $204 billion to $626 billion per year in 2018. This is a major shift in spending that has social platforms like Pinterest moving to capitalise on the trend. Never one to be the last one without a chair when the music stops, Facebook is in the process of tapping into this tidal wave of rising consumer interest with it’s new marketplace.
Rather than go after major e-commerce players like Amazon.com, Facebook is actually focusing their efforts on creating a new online marketplace not unlike Craigslist in order to create a marketplace for private individuals to easily buy and sell. Why all the attention? It’s simple. Currently, more than 450 million people visit buy/sell groups on Facebook every month. Statistically speaking, that’s approximately 26% of Facebook’s overall monthly active user base. No business as smart as Facebook is going to take a pass on an opportunity like that.
The new marketplace rolled out as of October 3rd in the US, Australia, the UK, and New Zealand, and they are already well into the process of actively promoting it with prominent in-app icon placement and marketing. All users have to do is click the button in the top left corner, and listings appear. All listings are organised and promoted based on your existing interests and location. If you see something that strikes your fancy, you can click a button and make an offer. All that remains is for you to make your own payment and delivery arrangement with the seller. Facebook accepts no responsibility for the transaction, and they do not handle the transaction financially speaking. The concept overall definitely offers greater security and peace of mind, however, as sellers can only use verified Facebook profiles to buy and sell, mitigating the opportunity for fraudsters to make a fast buck. The removal of anonymity and the ability of users to verify sellers and buyers via their Facebook information and history makes it much more difficult for scammers to take advantage of online marketplaces.
Ultimately, this new Facebook feature has the opportunity to be huge in terms of empowering small business owners and individual entrepreneurs. Buying and selling online has gone from a risky, time-consuming proposition to a matter of create, snap, and post. This could very well be the next sea change in e-commerce, and it bears watching in the days and weeks to come.