Is Facebook the next e-commerce giant?


 As early as Spring of 2013, from a concerted effort between some of the world’s largest telecom companies, stemmed Internet.org, an initiative to give free access to basic online functions to users in a number of developing nations. At the core of Internet.org: the one and only Facebook (Facebook, 2015).facebook-lite-app

With this move towards the two thirds of the world, which is not connected to the internet, Facebook has made great strands towards becoming a truly globalized platform (Nath, 2015).  Albeit the fact that adoption is slow due to the lack of financial resources for hardware, one can only imagine that this early expansion could translate into first mover advantages and a strong presence in the connecting part of the world. In another attempt to harness the emerging digital world, Facebook is optimizing its app for 2G connections, which are prevalent for this target audience (Jonnalagadda, 2015).

Although there are many ways to look at this expansion, this blog’s aims at extrapolating what the ramifications could be in connection to Facebook’s recent push towards the e-commerce industry.

As these develoThumb2-1pments and initiatives were taking place to connect the emerging world, Facebook’s has been building the tools to become a major e-commerce platform. In the recent months, we have seen the expansion of the store options of Facebook pages (Constine, 2015), the establishment of a peer-to-peer payment option (Rao, 2015), and even the introduction of Facebook M. Part human, part artificial intelligence, the M assistant is to be embedded in the messenger and  would assist Messenger users in reaching businesses with text-based queries. Much alike an advanced Siri, Facebook M would be able to perform tasks for users, but with less constraining boundaries to its capacities due to the human component of the AI (Hempel, 2015).

With a user base, which could jump from an already substantial numbers to even more impressive polls, and a shopping assistant which you could pull out of your pocket, it seems that Facebook could position itself as the next e-commerce giant. Bridging the gap between Facebook’s attempts to penetrate emerging digital markets and its advancements in the e-commerce business, can we extrapolate that Facebook could shift its business model from an advertising based model towards an e-commerce intermediary.

What are your thoughts?

Bibliography

Constine, J. (2015). Facebook Equips Business Pages With Mobile Storefronts For Shopping And Services. [online] TechCrunch. Available at: http://techcrunch.com/2015/09/08/facebook-storefronts/ [Accessed 17 Oct. 2015].

Facebook, (2015). Internet.org by Facebook. [online] Available at: https://internet.org/projects [Accessed 14 Oct. 2015].

Hempel, J. (2015). Facebook Launches M, Its Bold Answer to Siri and Cortana. [online] WIRED. Available at: http://www.wired.com/2015/08/facebook-launches-m-new-kind-virtual-assistant/ [Accessed 17 Oct. 2015].

Jonnalagadda, H. (2015). 2G-friendly Facebook Lite launches in India and the Philippines. [online] Android Central. Available at: http://www.androidcentral.com/2g-friendly-facebook-lite-launches-india-and-philippines [Accessed 16 Oct. 2015].

Nath, T. (2015). Internet.org: What It Is and How It Works (FB,GOOG,QCOM). [online] Investopedia. Available at: http://www.investopedia.com/articles/investing/021315/internetorg-what-it-and-how-it-works.asp [Accessed 17 Oct. 2015].

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2 responses to “Is Facebook the next e-commerce giant?”

  1. denniswijtman says :

    Interesting how Facebook is somehow ‘creating’ a new market for their products. I was already aware of the fact that Facebook was trying to bring internet to the third world (Bloomberg Business, 2015). Facebook is not the only one. Google is also investing heavily in providing ‘internet services’ to the developing world (Telegraph.co.uk, 2015).

    It’s surprising that big enterprises like Google and Facebook buys satellites and drones to provide internet to the third world and not NGO’s or governments of developed countries who are concerned with the welfare of those countries. Google and Facebook need to do a huge investment. Google is going to spend one billion dollars on satellites (Telegraph.co.uk, 2015).
    Facebook is partnering with Eutelsat Communications to leverage satellite technology and they also bought Ascent, a British drone manufacturer.

    Now all Facebook and Google (and many more) have to do is use this new market to sell their products. With more access to internet, the demand for e-commerce gets bigger and bigger. As your blog states, Facebook is to become a big e-commerce player. Google is probably more interesting. As the Telegraph states: ‘Google is able to position itself as the entry point of the internet’. Google knows all the browsing habits of the new market and could exploit them.

    Back to Facebook. As the potential usage of internet grows, the demand for e-commerce expand. Facebook, a company which is seeking for new revenue streams, could elaborate itself as an e-commerce player.

    I am excited at what the future brings.

    References:
    Bloomberg (2015). Company overview of Facebook, Inc. Android Central. Available at: http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=20765463. Retrieved at: 17 October 2015

    Rushton, K. (2015). Google spending $1bn on internet in developing world.
    Telegraph.co.uk. Available at: http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/digital-media/10870369/Google-spending-1bn-on-internet-in-developing-world.html. Retrieved at: 17 October 2015

  2. ozlemkarakus says :

    Interesting question. I would like to add some footnotes, because the main questions that raise in my head are: What will be the future of this digital platform? Will it continue dominating social media range?

    In 2011, we have seen that highly visited and popular sites can wither and finally end their “lives”. One Dutch example is Hyves, which was very popular amongst all age categories, but ended existing after the increasing popularity of Facebook. For a world wide example, I can mention MSN. We all know what the unfortunate end was for this site. I dare to say, when hearing those three lettered combination, we all get nostalgic feelings. This is a topic we can talk about for hours, because the word that I used, nostalgic, is exactly what is is. According to the online dictionary nostalgia means “wistful desire to return in thought or in fact to a former time in one’s life, to one’s home or homeland, or to one’s family and friends; a sentimental yearning for the happiness of a former place or time”. MSN used to be a dominating social media source but suddenly it wasn’t there anymore. When returning to the platform in case, to facebook, we should think about the question: will it still exist in the near future?

    An earlier mentioned, but equally important question is intertwined with the first one: The question whether if other platforms will arise that will outstip the possibilities on facebook. I personally see Instagram as a competitive social media platform when it comes to advertisments. Maybe some smart brains will launch a better site?

    Is facebook the next e-commerce giant? The future will tell.

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