Could Facebook replace eBay as a channel & venue?

Ed’s article yesterday set me thinking about advertising and selling on Facebook and I went off to do some data digging.

I came across an article on eCommerceGuide.com that is a “how-to” for setting up a business presence and advertising on Facebook, but which also contains some brief but interesting demographics near the top. It appears that the ages of Facebook users are changing dramatically.

The article calls out that in the first four weeks of 2008, the highest proportion of Facebook users were in the 18-24 year old range with 42% of total users.  However, for the same period this year, the focus had shifted as follows -

  • 18-24, 24%
  • 25-34,  27%
  • 35-44, 23%

That’s a considerable shift of emphasis in just a year.  What’s caused it and what does it mean?

I can take a stab at one factor that maybe other pundits have not recognised.  Prior to January 29th last year, the vast majority of eBay users were happy to use the eBay forums for socialising whilst waiting for sales to happen, or between fighting with an ever-increasingly dysfunctional search system, whose problems had been compounded by cut after cut in product sub-category quantities.

In fairness to eBay, some of that sub-category chopping, and swing to item specifics, may have been forced upon them by Google.  If you’ve ever set up a Google feed from an online store on your website, you’ll at least partly understand what I mean there.  I say “partly forced upon them” because in my opinion eBay are taking the whole item specifics program too far and using a clunky implementation – they should have normalised all sub-category and item specifics to agree and match between sites, before rolling the program.

However, John Donahoe’s disruptive innovation announcements disrupted the eBay community right off eBay and onto other platforms.  Facebook and Twitter have been the biggest winners from this.  Last summer and autumn, if you wanted to give a shout for an eBay seller in the UK, you didn’t go to eBay, you went to Facebook.  That has obviously had impacts on eBay traffic and listings volume, in addition to assisting the movement towards multi-channel presences by eBay sellers, and causing a strong swing in the user demographics on Facebook, MySpace, Squidoo and other social information and networking platforms.  The majority of eBay sellers are mature adults older than their mid-20s, thus the Facebook demography has shifted in part because of the eBay migrations.

In the eCommerceGuide article, they also state that Facebook has 150 million users after just five years.  After 13 years, eBay admits to 80 million accounts and that many members have multiple accounts, making the actual membership significantly less than 80 million.  PayPal’s last trumpet call mentioned 120 million accounts, again with a large number of users having both personal and business accounts.

This essentially means that Facebook have almost double the accounts of eBay, and 25% more than PayPal – remember I’m sticking with the bigger “number of accounts”, not users, here.  Unlike eBay and PayPal, Facebook purges what it sees as clone accounts, therefore their user-to-account ratio is likely to be a lot closer to 1:1 than the other two companies.

Enter cross-platform online store and shopping cart “ShopIt”, with no restriction for payment methods, plus other similar tools that will no doubt appear soon.  Marry them to Facebook’s simple to use demographics targeting PPC advertising system, and voila!  Targeted marketing to and from the masses.

So you sell trendy T-shirts – no problem, pick your age group and geography.  Selling surgical support stockings and carpet slippers – great – set your target segment and design your advert.  No more getting swamped under all the wrong-age-group products that turn up in eBay search under Worst-Match algorithms.  That user-age-focus is something that eBay has completely overlooked, and to be honest, this last year most sellers are just glad to sell to anyone, regardless of age, because buyers have become so few and far between.

The next challenge is to actually convert those narrowly banded ad-viewers into buyers … but that’s another topic, and where your sales-savviness comes into play.

What’s your thoughts?  Add your tuppence-worth in the comments.

Gaz

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4 comments
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  1. Excellent article! Love the comparisons of ebay’s manipulated numbers to the more accurate numbers of the sites which value honesty.

    If the readers want to learn even more about Meg Whitman & John Donahoe’s “Disrptive Innovation” of ebay, they can search the internet for “”eBay’s Disruptive Innovation, How’s that workin’ for ya? — GenuineSeller” or they can go to
    http://genuineseller.com/ebays-disruptive-innovation-hows-that-workin-for-ya/

    To read what ebayers and shareholders are really saying about ebay these days, google “Ebay Stockholders and Sellers Calling For Immediate Termination of John Donohoe CEO Petition” or simply go to:
    http://www.petitiononline.com/mod_perl/signed.cgi?jdonohoe

    For ebay employees’ views of ebay’s poor upper management, go to:
    http://www.glassdoor.com/Reviews/eBay-Reviews-E7853.htm

    For a list of alternative selling and buying venues, go to:
    http://www.everyplaceisell.com/cgi-bin/ep/ep.pl?sites

  2. It seems Facebook might be a good alternative that many people haven’t thought of to eBay, you’re right! Facebook has a classified/shopping section that many people are listing items on right now for free. It’s been setback after setback and bad decision making ever since Donahoe took charge.

  3. While I see Facebook and social media sites as an excellent place to have a business profile for business advertising, can you REALLY sell any amount through these sites? There is a huge difference between selling and advertising on FB.

    This article is a bit older (April ‘08) and also by Vangie Beal at EcommerceGuide.com.

    Facebook-for-Profit Apps Echo with Sound of Silence
    http://www.ecommerce-guide.com/resources/market_research/article.php/3738196
    By Vangie Beal, April 2, 2008

  4. Hi Aurora

    Many thanks for the pointer – an interesting read.

    I can’t help wondering though if the situation with advertising has changed with the shift in user demographics in the year since it was written.

    Must get Gaz onto it ;)

    Ed

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