Why Facebook Stores Are Failing

Content, audience and engagement. Facebook has it all. So why are brands apparently struggling to sustain a business case for their Facebook Stores?

In the past year alone, Gap Inc, Nordstrom, J.C. Penney and Gamestop have opened and subsequently closed Facebook Stores. How can this be? All the ingredients for a successful online retail venture appear to exist, yet in practise the result seems half-baked. Why?

To find the answer, we should first remind ourselves why Facebook has become such a phenomenon in the first place: Quite simply, it’s a great place to hang out, meet, and interact with likeminded people. Its a round-the-clock party, hosted by friends, in a familiar venue, with constantly changing decor. (No surprise it was originally called Faceparty).

The fact is, people party to socialise, not to buy stuff. How many parties do you attend where suddenly, an uninvited guest buts into your conversation weilding a pop-up store? Almost certainly none. And why? Becuase it’s a social faux pas. It’s a turn-off. It’s party pooping of the highest order. And it’s a real challenge for Facebook.

“We just didn’t get the return on investment we needed from the Facebook market, so we shut it down pretty quickly. For us, it’s been a way we communicate with customers on deals, not a place to sell.” – Ashley Sheetz, vice president of marketing and strategy, Gamestore.

A perfect place for people to converse and recommend stuff, it seems Facebook has yet to resolve the natural aversion its users have to bridging the apparently logical step between recommendation and transaction. The problem is, since when has logic figured in socialising with mates? A party based on logic? Be there to be square…

Batman's cape had seen better days

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Holidays mean Facebook games right? Wrong.

An interesting article posted by Tricia Duryee on AllThingsD today, appears to confirm, if confirmation were needed, the need for businesses of all kinds to ensure they take mobile into account both for product and for engagement.

The article, entitled ‘Americans Played Anything but Social Games During the Holidays,‘ explains that during the Christmas period, when people are away from work and no longer spending prolonged periods in front of a computer, participation in online games via Facebook dropped considerably.

Whilst it’s no surprise that a great deal of social interaction via Facebook takes place at the workplace, the scale of the apparent dropoff during the holiday period may well raise some eyebrows at Facebook.

Contrast the drop with the gains made in mobile and there’s a clear case to ensure mobile is part of the marketing mix for the coming year. A statement of the obvious perhaps, but the AllThingsD article is the first time I’ve seen activity contrast so markedly during a crucial period for measuring and guaging social attitudes.