But losses mount for the home furnishings e-retailer that went public in October.
The new Facebook Gifts service lets shoppers buy presents for their friends.
Facebook today began rolling out Facebook Gifts, which enables U.S. shoppers to buy their friends presents, such as ice cream sandwiches from Jeni’s Splendid Ice Cream.
“Every day, millions of people share special moments with their friends on Facebook by saying ‘Happy Birthday,’ ‘Congratulations,’ or simply, ‘I'm thinking of you.’ Now there is another way to celebrate those moments,” reads a post on Facebook’s news room page. “Starting today, you can give real gifts to your friends on Facebook using Gifts.”
Facebook has long noted consumers’ friends’ birthdays, anniversaries and other notable personal dates in the top-right corner of the home page under the heading “Birthdays and life events.” Now the social network has added a link under notes such as “John Smith is 31 today” that says “Give him a gift.” Consumers also see that link when they view the pages of their friends who are having a birthday.
When a consumer clicks on that link he can select a product to buy for the friend. Consumers can either select the exact style or product, or opt to let the friend choose. He can then write the friend and note and share the gift—either publicly on his friend’s wall or via a private Facebook message. The consumer giving the gift can either pay immediately or when the gift is shipped.
When a shopper receives a gift, it appears on the page as an image of a wrapped gift. When clicked, the gift unwraps and he can select the color, style or other options, as well as enter his shipping address. If he doesn’t like the item, he can swap it for a different item available in Gifts, without his friend knowing.
Digital products, such as gift cards, are sent immediately. Physical products are packed in a Facebook bag and sent by the manufacturer to the recipient “within a few days,” according to Facebook. Retailers can fill out a form on Facebook to have their products featured in Gifts.
Facebook says the commission it takes from Gifts varies, depending on the retailer and product category. Among the retailers whose products appear in Gifts is 1-800-Flowers.com Inc., No. No. 51 in the Internet Retailer Top 500 Guide, and Art.com, No. 117. Facebook did not say when Gifts would be available outside the United States.
"With nearly 1 billion people on Facebook the reach is just about as big as you can get," says Art.com CEO Geoffroy Martin. “It’s very early on, but the potential is very big.”
The service is essentially the reincarnation of Facebook gift application Karma, which the social network acquired in May. Karma integrated with Facebook to notify consumers of gift-worthy events, such as birthdays. Users could then choose a gift, such as clothes or food, and inform the recipient of it via text, Facebook or e-mail.
Gifts is the social network’s broadest e-commerce initiative to date. The social network’s previous foray into broad-based e-commerce was Facebook Deals, which launched last year as a Groupon-like daily deal service that sold limited-time deals that focused on social experiences. The social network abandoned Deals after only a few months.