Saturday, September 29, 2012

Facebook Inc (NASDAQ:FB): F-Commerce Now Set To Fight With E-Commerce? [Analysis]

With Facebook Inc(NASDAQ:FB) slowly inching towards the magic figure of a billion in terms of users, the gift feature can turn out to be a major money-maker as it will be a powerful platform using both social media and online shopping. Analysts have come up with a brand new term, exclusively for the social network, called F-commerce.

Users don’t have to be satisfied with virtual gifts any more because now they can receive real gifts like stuffed animals, Starbucks gift cards, and cupcakes from their friends on special occasions. This is yet another attempt on Facebook’s part to improve their cash flow and give a boost to their stock price. The promo on Facebook’s official Gift Page looks promising and the best part is that gifts can be sent to friends even if their addresses are unknown.

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 The service will begin in the US and this is how it works – users click on the friend’s name that will come up in the birthdays news feed. A list of the hundreds of gift items available will appear on the screen from where they can select the gift. A card will also be attached along with it. A prompt for gifts will be displayed on the users’ Timeline on their birthdays as well.

The virtual equation still remains as the user gets a chance to virtually “unwrap” to sneak a preview of the gift and decide to keep it or politely refuse. Payment is flexible and can be done immediately or after the gift has been delivered. The choice of the delivery location depends on the user’s friend. Privacy issues have been addressed by leaving the choice of sharing this activity with other friends, to the user.

Rebecca Lieb of the Altimeter Group states that both F-commerce and mobile commerce will get a powerful surge if this new venture is successful. But a minor hiccup has to be dealt with – there are concerns about Facebook getting personal details of the recipient like an address and contact details and thus targeting them to increase the number of users on the social network.

Shares of FB soared 6.60% to $21.66 on Friday, but still down 5.25% for the week.

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