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How Facebook Advertising Will Help Online Retail Hit $2 Trillion in 2017

Written by: Juliana Casale, Director of Marketing

Bolstered by millennial mania over mobile and the rise of extremely targeted search and social media advertising, online retail has become a booming business that is forecasted by eMarketer to bring in $2 trillion in worldwide sales by 2017. As the ecommerce movement gains steam, brands must differentiate themselves to keep a competitive edge.

From brick and mortar/online hybrids to limited time sale memberships, here’s how Facebook advertising is fueling the growth of these new retail players.

Pure Play

There are many advantages to being an Internet-only retailer — low overhead and agile response to market changes chief among them. As we’ve seen with Amazon, a focus on digital selling places greater importance on responsive customer service and easy online transactions. The combination of one-click ordering and free two-day shipping through Amazon’s Prime membership has made the online retailer a powerhouse. For pure play retailers, all interactions come through the brand’s website, which makes Facebook’s Website Custom Audiences the perfect tool for retargeting guests and return browsers. With WCAs, ecommerce companies can reach back out to shoppers who’ve abandoned their carts, upload email lists from new member signups to promote welcome offers, and re-engage visitors who’ve dropped off in activity over a specific timeframe.

Multichannel

Legacy retailers like Macy’s have had to translate the experience of brick and mortar stores to the online marketplace. Although traditional shopping outlets have had a steep learning curve when it comes to ecommerce, there are some benefits to having a physical and digital presence. For example, the ability to pick up and return online orders in-store has become extremely popular, particularly amongst holiday shoppers looking for last-minute deals. Loyalty programs allow multichannel retailers to track customers’ online and offline behavior, and retail apps help track if a shopper is near a brick and mortar location. Signups for rewards programs and app installations are both goals that Facebook’s direct response offerings like Mobile App Install ads and Unpublished Page Post link ads address.

Flash Sale

For online retailers like Wayfair and Gilt, limited-time sales help make members feel part of an exclusive club. With customer acquisition and retention on the line, syncing landing pages to ad offers and ensuring there’s enough inventory to meet demand are top priorities for campaign managers in this space. Facebook’s Multi Product Ads are tailor made for retailers who want to promote three or more products at a time — from new furniture lines and designers to seasonal shoe collections and the hottest electronics. The repetitive nature of repeated flash sales can make it difficult to keep up the excitement on social media, and this new ad unit has an eye-catching advantage over single-image placements. It also drives real results. According to the CMO of online retailer Jewelscent, MPAs have led to a 3x decrease in the company’s cost per click on Facebook.

Subscription Service

Building an active user base is the name of the game for subscription service brands like Stitchfix and Birchbox. Whether membership means requesting a box of handpicked fashion suggestions or a fresh batch of beauty products, targeting customers with the potential for purchasing behavior is key to advertising ROI. Facebook’s Lookalike Audiences allow ecommerce brands to expand advertising reach from known, highly engaged customers to potential customers with similar behaviors and interests. Once a subscription service has hit market saturation or experienced a customer acquisition plateau, Lookalike Audiences are a logical next step to boosting membership numbers and attracting a fresh cohort of active purchasers.

Regardless of business model, all online retailers can benefit from Facebook’s wide range of direct response ad units and features. With the power to attract new signups, retarget lapsed shoppers, and expand audience reach to qualified potential customers, $2 trillion sounds like a piece of cake.

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