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Facebook Inc (NASDAQ:FB)’s Bold Bid to Steal Market Share From Amazon

Facebook Inc. (NASDAQ:FB)

Facebook Inc has added a new food-delivery option to its social networking website to make online shopping easy for its more than 1.5 billion users. The Wall Street Journal reported that the new option is designed to let users buy movie tickets, order food delivery and book salon appointments straight from the app.

As we reported earlier, the social networking giant is trying to get a foothold in the e-commerce sector in a bid to steal market share from Amazon.com, which dominates the e-commerce scene in providing a B2C platform for businesses to sell directly to consumers. Facebook’s focus is on consumer-to-consumer (C2C) segment. Thus, the company earlier this month launched Marketplace to allow users buy and sell stuff within a local community.

Facebook Marketplace

Facebook Focusing On Useful Tools

According to the report, the social networking giant appears to be trying different things to keep its users hooked as personal sharing on its network has been declining in recent years. “How can we make Facebook more useful in your everyday life?” Andrew Bosworth, Facebook’s head of advertising technology and local teams, said, noting that the company’s work in this arena would continue “over the course of the next months and years.”

Facebook says that its Marketplace feature, accessible by tapping on the shop icon at the button of your Facebook app, is “a convenient destination to discover, buy and sell items with people in your community. Marketplace makes it easy to find new things you’ll love, and find a new home for the things you’re ready to part with.”

According to a research report on Marketing Week, one out of five Facebook users are willing to buy stuff through the social media platform. In contrast, only one out of 10 Twitter users were willing to buy stuff directly from the platform.

Recently, the social media company also launched a separate mobile app for events on Facebook. Users are now able to purchase movie tickets through Facebook’s partnership with Fandango.

“Given the kind of data that they have on people, they believe there is a lot more utility they can provide,” said Robert W. Baird analyst Colin Sebastian.

“The utilitarian tools represent a subtle shift for Facebook, which in recent months has been emphasizing the social aspects of its site. In June, it said posts from friends and family in its news feeds would trump content from publishers and public figures, making the site more personal,” the WJS article reads.

Social e-Commerce

According to a report by Retail Dive, small and midsized businesses that don’t have big advertising budgets are benefiting by building e-commerce-enabled social media sites.

A study from Business Intelligence in 2016 shows that social media boosted its share of e-commerce referrals nearly 200% between the first quarters of 2014 and 2015.

According to the Internet Retailer’s Social Media 500, the top 500 retailers made $3.3 billion from social shopping in 2014, up 26% from 2013.

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Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.

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