The Street has been predicting the foray of Internet giants like Facebook Inc (NASDAQ:FB) and Twitter Inc (NYSE:TWTR) into e-commerce for a long time but now it seems the prediction has come out to be accurate. Both social networking behemoths are toying with the idea of tapping the $304 billion global e-commerce market by using the sheer strength of their multi-million user base, albeit with a different approach, altogether.
While Twitter Inc (NYSE:TWTR) gave a glimpse to its users and marketers of how e-retailing will work in the “tweet world” by launching the ‘buy button’ in the tweets of the online retailer Fancy, Facebook Inc (NASDAQ:FB) too made an announcement on 17th of July that it has started to test a new feature to help businesses drive sales through the social networking platform. Facebook Inc (NASDAQ:FB)’s announcement came with an image of how the ‘buy’ button will look on its platform and describing how it’s users can directly buy the product from the businesses, without leaving the platform. Facebook Inc (NASDAQ:FB) also mentioned that the current test is limited to a few small and medium-sized businesses in the US.
With more and more marketing dollars being pumped into digital advertising, especially from the likes of Amazon.com, Inc. (NASDAQ:AMZN) and eBay Inc (NASDAQ:EBAY) analysts on the Street expect this to be a win-win situation for both the e-commerce giants and the social networking behemoths. The analysts are quick to point out that Twitter Inc (NYSE:TWTR) and Facebook Inc (NASDAQ:FB) are not directly venturing into e-commerce, but are rather working to ‘reduce friction’ between advertisers and consumers by removing one step from the process of purchasing something online.
While Facebook Inc (NASDAQ:FB) definitely has an advantage over Twitter Inc (NYSE:TWTR), when it comes to the number of users and the sheer amount of user data it has, which makes it figure out their preferences accurately. One can never be sure about who will win the social networking e-commerce wars because as history teaches us, Google Inc (NASDAQ:GOOGL) was already a giant before Facebook Inc (NASDAQ:FB) and Twitter Inc (NYSE:TWTR) came into existence, still it was never able to taste the social networking success.