E-commerce on Facebook, Are You Kidding Me?

You know the difference between social media and social marketing. Social media is about that dorky kid on youtube swinging a stick around, and social marketing is about efforts that engage consumers in two way conversations. But branding isn’t good enough these days. Direct sales and hand over first ROI that anyone with sixth grade level of education can understand seems to be the new push.

Enter Facebook credits. Match this with Payvment, a new e-commerce engine, and you have what looks to be the beginning of a new revenue model on Facebook, e-commerce.

The Web 2.0 model of audience first, monetization later has proven to work. But, with an entity as big as Facebook with massive privacy issues, you don’t necessarily have the freedom to throw a bunch of shit at the wall to see what sticks. Okay, maybe they are putting a little more thought into it than that, but so much of what they do seems inherently risky. I guess at that level anything is.

Facebook’s failed Beacon program missed the mark for one reason. No opt in ability. They were just going to broadcast everything you purchase to everyone in your network. So much for surprise birthday presents. Well, of course that failed.

Now, if I had an easy way to select whether or not to share a purchase, I could see that working. There is no incentive for me to tell someone I bought ketchup. Even with a Facebook credit promotion that paid me to share, I still won’t. My social currency, the value of my shared information, drops when I share lame content. However, if I purchased a new smart phone running Android because I now hate Apple; that communicates who I am and raises my social currency. Their brand elevates my status.

I am defined through some of my purchases, certainly not all of them. So what happens when e-commerce takes place of branding? Brands look less cool which in turn makes me less interested in sharing anything about that brand. There needs to be a place for both and while related they are separate. For me, Facebook is about the brand conversations. Brand development drives sales, but you have to do your homework to see the ROI. It’s not always obvious but it does work. Strong brands are inherently shareworthy. Does your social marketing suck? That’s probably because your brand efforts suck.

Monetization of social media means we have to live with social marketing. Companies need revenue before they run out of VC money. Regardless, there are limits to what they can subject users to. Exceed those limits and you start disenchanting them. When another front runner pops up, everyone will just migrate to next big thing. People migrated from Friendster to MySpace to Facebook.

If Facebook starts engaging in e-commerce, the already problematic privacy issues they have are going to explode. If they focus too much on money while ignoring what makes great online communities, it very well could be the beginning of the end. Communities, brand pages, advertising, and now e-commerce? I just don’t see why the entire Web needs to be on one URL.

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