Is Facebook Gifts a Game Changer?

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Zuckerberg may have found the key to Facebook’s success, and one that will keep shareholders satisfied while they figure out the social search and ad platform strategy. The new Facebook gifts is unlike anything we’ve seen before, and a far cry from the pixelated gifts we said goodbye to in 2010. The launch of Facebook gifts in the US came a few months after Facebook acquired social gifting platform Karma, so it was a move everyone was waiting for.

What’s unique and potentially game changing about Facebook gifts is the personalised recommendations feature, which uses data collected about your Facebook friends to offer suggestions. Although, we’ve yet to see how accurate and interesting the gift recommendations will be, it could potentially take a bite out of Amazon and eBay.

Facebook gifts could spark a whole new wave of last-minute gift giving, as users don’t even need to leave the site to purchase and ship a gift. The majority of the gifts are within the $20 – $30 region, making them small enough for an impulse purchase, but pricey enough for be of a decent quality. After making their selection, the recipient will receive a virtual token and notification of the gift they’ve received. They can then select the size, colour, or flavour, where relevant, or even exchange the gift for something of equal value. They then select a shipping address and then gift will be with them within a few days.

In a highly strategic move, Facebook is rolling out the gift service slowly throughout the US. Although, to encourage giving and uptake of the new service, if you receive a gift before it’s available in your state, you’ll then have access to the gift giving service. The new service will have a touch a novelty for a while, so this was an excellent move by Facebook to encourage spending and spreading the gift giving craze virally.

Potential Issues

Privacy. As always, many users will be concerned about privacy issues, as giving or receiving a gift through Facebook requires handing over yet more personal information. Users are currently on high alert following the false alarm over private messages going public, after some users complained that messages from their past were coming back to haunt them. Although a false alarm, it did force many users to consider their privacy options and to question what they’re sharing with the site. Adding credit card details and a home or work address to the mix may be a step too far for some privacy conscious individuals.

What do you think of this move? Should Facebook be entering into the e-commerce ring, or should their focus be on building an ad network and social search platform to rival Google?