Facebook Tests ‘Buy’ Button to Capture Impulse Buyers

Source: Thinkstock

Source: Thinkstock

Making an impulse buy of an item you see advertised when you’re scrolling through your News Feed is about to get a whole lot easier. Facebook (NASDAQ:FBannounced on Thursday that it was testing a “Buy” button on ads and Page posts on its desktop site and mobile app to enable users to make a purchase without leaving Facebook. The button, which the company calls “a new way for people to discover and buy products on Facebook” and “a new feature to help businesses drive sales,” is currently in limited tests with a number of small and medium-sized U.S. businesses.

TechCrunch’s Josh Constine reports that Facebook isn’t charging those businesses to test the button, though the company “was not disqualifying that option” in the future. It’s likely that if/when the feature rolls out, Facebook could at some point charge a fee or a percentage of revenue for businesses to use it. The button enables consumers to complete purchases without leaving Facebook by keeping a credit card on file with the social network, entering new payment details to save for future use, or making a purchase without saving payment details. Facebook won’t share payment details with other advertisers, and stresses the security of the service, noting that users don’t have to save any payment data with Facebook.

Constine notes that the Buy button isn’t Facebook’s first effort to bring ecommerce to its social network: “It tried a Pinterest-style Collections feature with buy buttons that led off-site back in 2012. It enabled on-site payments to charities with its Donate Button last year. Most recently, it’s been testing an ‘Auto-Fill With Facebook’ feature that automatically enters your payment details when you’re making a purchase in a third-party ecommerce app. Now it’s experimenting with letting you make purchases of physical good from for-profit ecommerce retailers entirely within its walled garden.”

Facebook buy button

Source: Facebook.com

Autofill enables users to keep a credit card on file with Facebook, and then easily use those payment details to streamline checkout with Autofill-integrated retailers. The Buy button takes Autofill a step further, keeping the whole transaction within Facebook. It not only processes payments, but also has the potential to increase conversion — the percentage of interested shoppers who actually make a purchase. Ecommerce sites typically lose shoppers when they need to go to the checkout screen, and when they have to enter their credit card number. Facebook’s Buy button eliminates the necessity of each of those steps, changing the purchase process so that consumers don’t have to “leave the comforting blue chrome of Facebook and your friends,” as Constine puts it. They’ll just click buy, click to confirm, and the purchase is complete, right from their News Feed or a business’ Facebook Page.

Facebook isn’t the only social network currently testing a solution to enable one-click or other simple transactions within its platform. Tests of a “Buy Now” button recently started appearing on Twitter (NYSE:TWTR), as reported by Re/Code’s Jason Del Ray, who noted that “in-tweet shopping” will likely roll out soon. In May, Twitter and Amazon (NASDAQ:AMZN) announced a deal to allow consumers to add products to their shopping carts with a tweet, though they’d have to later go to Amazon to pay and complete the transaction.

Forbes’ Haydn Shaughnessy writes that the Facebook Buy button could be “Amazon Review on steroids,” noting that “the future of much of our online shopping lies inside communities, even though Amazon might not yet have woken up to that.” Shaughnessy notes that user engagement with content — the typical vehicle for advertisers to drive sales — is going down. Twitter, Google (NASDAQ:GOOG), and newspaper sites have reported ad rate declines, and social networks are increasingly being viewed as the next space to get users to buy.

As for Shaughnessy’s (rather vague) idea that Facebook’s Buy button could mimic Amazon’s customer reviews, the value of the Buy Button is not that it would show actual customer reviews – it doesn’t look like it will. Instead, in the absence of traditional customer reviews to convince shoppers to make a purchase, advertisers will look to derive value from the fact that their ads show up in a social space, where your friends will be able to comment on an ad for a watch that they have the watch, or just bought one, or know someone who loves theirs.

More than that, the Facebook Buy button looks to appeal to advertisers looking to attract impulse buyers as they scroll through their News Feed and converse with friends — a move to make ecommerce just a little bit more pervasive on a site and app that millions of people worldwide use everyday.

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