CEO Henry Wong discussed the new product and display's impact on social media and visa versa.
AdExchanger.com: How does social media change display? And how does it change e-commerce in display?
HW: If content and commerce are intimately tied to social networks/features in the future, then social media may have a profound affect on traditional online display advertising in and out of Facebook. Display advertising in Facebook, for example, doesn't allow for normal rich media advertising and doesn't follow the same form factors of traditional publishers and IAB compliant ad units. By having a 'closed' network, Facebook can literally dictate how display advertising is presented (or not presented as the case may be) to its users. That's why so many brand dollars are creating customized 'display ads' within their sponsored and official brand pages. Outside of Facebook, we're seeing ads with social tie-ins, and allow for users to become 'fans' through the engagement of the ad itself, or utilize Facebook Connect to leave comments/reviews. In or out of Facebook, these ads are ultimately much more viral and tie directly back into the social fabric of Facebook. Anytime you have a social tie-in within an ad unit, we believe security and privacy of the user is tantamount, which we best solve through our consumer facing trustmarks from McAfee (#1 security services) and TRUSTe (#1 privacy services).
Social media, of course, has a profound impact on transactional display ads and applications as well. Facebook has overtaken Google now as the most visited site on the Internet. As more retailers look to woo would-be shoppers, recent reports indicate that Facebook is by far the most effective way to turn conversations into conversions. This trend will force retailers and brands to not only set up Facebook storefronts, but pro-actively run marketing campaigns against their fanbase to measure the success of their social commerce strategies. ShopFans is the first native Facebook built app which allows this nexus between brand, fan, and secure transactions to exist.
Can you give a use case of how ShopFans works? Please identify the client types this is good for.
Utilizing the world’s most secure social commerce technology available, ShopFans allows consumers to make secure purchase transactions directly in Facebook without compromising security and privacy. Moreover, ShopFans was built as a native Facebook application, which allows brands for the first time to tie directly into all of the social plumbing of Facebook, including promotion through “Wish lists”, “I want this!”, “Likes”, “Shout outs”, gift registries, private and exclusive sales, and more. ShopFans is the industry’s first ever fully secure, complete, and native Facebook ecommerce application, which not only allows brands to chat directly with its fans, but also allows fans to virally promote and share the brand’s message and products; all done through the social ‘hooks’ within Facebook.
Our first publicly announced client is with celebrity fashion retailer StyleQ. Apparel is a great demonstration of the power of social commerce, where you can mimic 'live' shopping experiences between friends: browse, shop, ask friends for ideas or advice, get buy in from your peer groups, purchase on the spot, or list in an online gift registry/wishlist for your loved ones to purchase. In order to be truly 'social,' you need much more than a 'storefront in an iframe;' you need a holistic set of options/tools which are tied directly into the social plumbing of Facebook itself. Beyond apparel, any brand or set of products which have existing fan allegiance make great showcases of ShopFans. You'll see some of our major studio and gaming clients go live with ShopFans next. (See StyleQ’s ShopFans storefront.)
What do you see as the opportunity for Adgregate Markets with ShopFans? Can it drive double-digit revenues for the company a year from now, for example?
Social commerce is white hot, and the demand for a truly social commerce solution like ShopFans is exploding. The opportunity is easy math: The 'destination' ecommerce marketplace today is about $200 billion, and while Facebook has overtaken Google as the most trafficked site on the web, barely any brands have set up actual storefronts on Facebook. If only 1% of ecommerce dollars shift toward social commerce, that's a $2 billion market overnight. Building a double digit revenue company within this marketplace would only be a small fraction of even that. Adgregate is ultimately a seller of picks and shovels, and anyone wanting social commerce will have to ask at some point who has the best product out there? With our proprietary technology endorsed by security and privacy heavyweights McAfee and TRUSTe enabling 100% secure checkout within Facebook, and our growing ecosystem with leading ad networks and ecommerce solution vendors, and now our new truly social commerce solution ShopFans, we believe we are in the best position to capture overall market growth in this area.
By John Ebbert