Facebook and Twitter are integrating "Buy Now" buttons, why?

Over the years, social networks such as Facebook and Twitter have garnered huge audiences with the ability to monetize the traffic via advertising. Facebook, in particular, started gathering user-entered profile data in order to power algorithms that deliver carefully targeted content to each unique consumer. The data collection and utilization has resulted in complaints and controversy. However, users have become accustomed to the idea as time passed. Online-Retailers have leveraged Facebook’s targeted ad campaigns, but now look to take marketing one step further by implementing the “Buy Now” button.

By utilizing an in-app “Buy Now” button, a new feature which enables direct purchase without leaving the site, social networking giants like Facebook and Twitter hope to grow revenues and stake a larger claim in the ever growing eCommerce market.

While many retailers already use Facebook and Twitter to share and promote their products, the “Buy Now” button may encourage more conversions which can be directly attributed to these social networks. In-app purchases would be especially useful for mobile users as they would no longer have to click through to outside links. With strong mobile presences, Facebook and Twitter stand to gain a lot from increased mobile purchases, and so do consumers.

Large retailers, like Amazon, are particularly interested in targeting Facebook and Twitter for social commerce because the social networking sites not only have large mobile followings, but also feature expansive advertising networks on their platforms. More specifically, Facebook provides a comprehensive focus on data that has seen continued growth over the years. Still, many retailers are considering moving onto Pinterest and Instagram as well, though they may not prove as useful as the larger social networks. E-Marketing analysts believe Pinterest could become a huge player, however the network lacks a comprehensive ad infrastructure since allowing ads only started within the past six months.  Check out our data on the growth of Pinterest.

How successful could this be? It’s hard to say. The idea is not just sensible, it is timely. Facebook and Twitter have recently improved both ad content and ad designs, making less intrusive ads that still catch the viewer's attention. The ads are now better targeted than ever before and feature action-oriented designs that encourage click-throughs and purchases. But in-app purchases have never been a sure thing. Facebook’s Gifts feature was supposed to take advantage of the upswing in activity that happens around birthdays by allowing users to buy physical gifts for their friends and send them via Facebook. But the idea failed to gain traction and Facebook eventually discontinued it.

So, despite a feasible idea and an agreeable market, Facebook and Twitter are taking it slow. The networks are currently beta testing the “Buy Now” feature, but are limiting it to select small and medium-sized businesses. With the holiday season approaching, these lucky few e-stores could see a boost in sales as Facebook and Twitter may execute a full rollout. Or it could fail as Gifts did. Only time will tell.