Conventional wisdom suggests that social media sites are good for a company's branding but not necessarily good for selling. That may be the case for huge conglomerates, but small businesses are proving that idea wrong.
The New York Times reports that a growing number of small companies are collecting a majority of their revenues from their Facebook storefronts. The ability for businesses to sell products through the social media site--usually with the help of a third-party e-commerce platform like Payvment--even has a name: F-commerce.
Payvment reports 170,000 clients sign into around 1,500 stores on Facebook per week. Shoppers can store credit card and other information through the site. Small businesses like North Carolina-based bakery Got What It Cakes told The Times that once it opened its Facebook page in 2009, the company saw orders nearly triple.
“I am a local, one-person business but I have 5,000 fans,” Got What It Cakes owner Mandie Miller told The Times.
Miller and other small business owners say that the ability to reach a broader audience through Facebook events, promotions, and photo and video sharing has allowed them to build a rapport with customers who are more likely to spend.
“[Customers] communicate with us there about everything, from asking about a shipment to what do we recommend for a gluten-free 9-month-old,” Darren Gann, co-owner of the Baby Grocery Store, told The Times. In fact, Gann says 35% of his sales come through Facebook.
There are some hurdles for business that want to get into the F-Commerce game, however. For starters, Facebook ultimately owns the page. All of the information you promote or store on your site is theirs. Consumers continue to report uneasiness when buying through Facebook for this very reason. There is also the fear that Facebook posts written to customers could fall through the cracks. And what about those customers who don't have Facebook?
“I do a lot of wedding cakes, and it’s the moms and dads of brides usually paying and they often want to go to a regular business website. I also have grandmothers in their 80s and 90s that come to my cake tastings,” Miller said to The Times. “They aren’t on Facebook.”