By Jack Lowinger, Founder and CEO of Cartonomy
Facebook’s acquisition of TheFind is unsurprising — as the company continues to strive to go beyond social networking and further ventures into ad tech and eCommerce territory. It’s the next step in Facebook’s playbook of trying to get users to search and buy through its platform and from its advertisers.
By acquiring TheFind, Facebook is creating a new referral channel that will attract both shoppers and advertisers, ultimately increasing profits. So far, Facebook has been unsuccessful in converting users to consumers on a large-scale basis. It hopes to finally achieve this by utilizing TheFind to improve its ad delivery to members and transform into a go-to destination for shopping ideas and inspiration.
Facebook’s Transition To Product Discovery
With more than 15 million shoppers using TheFind, it’s undoubtedly a power player in the product discovery space. The acquisition came on the heels of Facebook’s launch of a special ad unit designed to highlight specific products a merchant is trying to sell.
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Because TheFind provides users with customized recommendations while searching through a massive database of products, the acquisition has major potential for Facebook to go beyond merely matching a company and users, to ensuring that products in ads are items the consumers is likely to purchase. This puts Facebook at an advantage over other product discovery and social shopping sites like Pinterest, who may see the need to catch up by introducing more direct “buy” options for the content that users interact with on the platform.
Most importantly, the addition of TheFind may give some Facebook users a reason to finally engage with the advertising on the site, which many have previously seen as ubiquitous and annoying. More than a quarter of Facebook users believe ads are negatively affecting their experience on the site. For Facebook, more engaging ads will cut down on user frustration and ultimately result in more clicks and increased advertising dollars.
Where Do Consumers And Retailers Fit In?
By deploying a channel for personalized products to connect with socially active shoppers, Facebook hopes to create a win-win for retailers and shoppers alike. Brands and retailers have been trying for years to use Facebook as a way to generate referrals and customer loyalty and this acquisition could be the answer they have been awaiting.
With access to more information about what users are likely to want to buy and share, brands and retailers have an extra edge. Shoppers are exposed to a more appealing set of advertisements, which goes beyond the seemingly random or repeat promotional content many Facebook users see when they currently log in. By highly customizing ads to the user, it’s more likely they will actually click through to purchase.
It will be interesting to see if discovery search engines like TheFind, which consumers primarily found useful for its quick price and availability information, will continue to be compelling if converted into an advertising-first platform. It’s possible that shoppers could run to one of several similar services and ignore Facebook’s latest play, opting to continue to use Facebook primarily for its tried-and-true like and share socializing.
However, if the acquisition proves successful in changing Facebook users’ behavior on the site, it’s likely that it will signal the start of a race from competitors to capitalize on ad tech that improves the product discovery experience and conversion rate on product suggestions. This may then mark the first major milestone on the long and difficult journey to turn social networks into e-Commerce destinations.
Jack Lowinger founded group shopping and e-Commerce solution Cartonomy in 2012 in order to fill a void of viable social shopping options online.
