Transcript
Peter:
Welcome to unpacking the digital shelf, where we explore brand manufacturing in the digital age. Hey everyone Peter Crosby from the digital shelf Institute. The best shopping experiences are those that give each consumer maximum control over their own journey. You know, when, where, and how they discover the research by that's, why over time brand should aspire to make every brand moment. Shoppable Facebook, you may have heard of them is a particularly important partner with brands to create shoppable moments for consumers. They have a ton of innovation going on over there. And recently I was lucky enough to speak with NurAin Josh and model director of eCommerce partnerships at Facebook to get you the latest here's that conversation. Right? Thank you so much for joining us on the podcast today. We are super appreciative. We know how busy you are putting all of this together and getting it out to market. I was wondering, I wanted to jump right in because certainly more than ever, consumers are in charge of their own journey right now. And I was wondering what consumer behavior led you to create the option to directly transact commerce on Instagram and Facebook. And why should brands lean into that capability especially now
Narain :
Great to be here, Peter, and thanks for that. So we at Facebook, generally speaking, take a very iterative approach to product development, and it really starts by looking at what emerging consumer behavior we see across our family of apps and services. And in the case of shopping, if we look at Instagram shopping, the non checkout version of Instagram shopping is about three years old. And what led us to build that in the first place was really what we saw was interactions between people and brands in the comments section of Instagram posts that businesses had made. And a lot of those questions were what's the price? What colors, what sizes is this available? Is it in stock? Is it out of stock is available online? Is it available in them brick and mortar store? Those are the types of questions. So the idea with Instagram shopping, knowing that at the time, there were very limited ways to put in outbound links and to Instagram, and there still are supposed to give bill businesses the ability to directly link to product detail pages from Instagram to those pages on their own websites.
Narain :
So we would create a native product details page that would then with a view on website button link out to the business's web page in our in-app browser. And that's been around for three years and that's got a significant and substantial number of businesses using that around the world. About a year ago, we launched Instagram shopping with checkout, and this was launched as a test in the U S and it's still running as a test in the U S and the idea here was, as I, as I mentioned, we look at emerging behavior and B, we started to see that people were encountering hurdles every, you know, when you open a business's website in our, in our browser, every website looks, it looks different. There are limitations to the amount of variants and information that we display on our product detail page. So when you land on a business own product details page, you see a lot more, right?
Narain :
So it was a little bit of a dissonance and things like that. They're essentially it all boiled down to that. There was a lot of friction, right? We saw anywhere from another eight to 22 clicks or taps that you have to do between linking off and checking out. So we said, there's an option here for buyers, for us to remove friction. And that was what led us to do it on the buyer side. And then one of the initial hypothesis, what we had for business was by removing friction on the buyer side, we then had an opportunity to enable businesses, to tap into an incremental audience, a mobile only audience, Instagram shopping, and check out are only available on mobile at the moment. And so there's a potentially incremental audience, people who weren't checking out on businesses on mobile websites. So that's really where we started.
Narain :
And when you as you said, you rolled it out in the holiday season, in beta, in the U S what were your, what were your learnings out of that? I, I, you know, whenever software hits the hits, the actual unit you always learn lessons. What came away for you? What were the overall results? Yeah, so, as I mentioned last year was really around testing and, and understanding, well, what does consumer behavior, actual consumer behavior look like compared to what our expected behavior was? And, and does this work right? Like, will, will everything proceed as planned once, once users start the checkout flow. And I think the first thing that we kind of did see was that this idea of removing friction did, did work, right. The initial hypothesis that we wanted to test did play out and what the data points that we looked at that was for first time buyers, what was their first transaction?
Narain :
What was it that led them to check out on Instagram? Whereas in the past, they would've had to go to the business's website. And when we start to look at the mentions of exclusivity, some kind of call to action, some kind of social proof or validation, right? That this is that the product wasn't just being sold to them by a business that they didn't follow, but either a business that they followed. So they had some kind of affinity and relationship with that business already, or an, and I know we're going to get to this a little bit later in terms of the role that influencers and creators play, but also that there was some format advocacy around that product. So that was one dimension. The other dimension was it's only available right here, right now from this business, either exclusivity of time or or, you know, inventory account or, or channel, right.
Narain :
I can only get it on Instagram. So those are really the dimensions and the idea of removing friction. We did remove enough friction to enable people to make that first purchase. That was really what last year was about testing. I mean, it's great to be able to know that, that those, those core elements of, of, of driving urgency and removing friction actually end up producing results. Yeah, no, it was great to see that and equally the other, the other thing that we saw was it, it, it, we have a pretty diverse set of businesses on Instagram shopping with checkout now. And a lot of this held true, whether this was a large multinational business or a small direct to consumer digital native business. So it was interesting to see that a lot of these things held true across that spectrum. Then you fast forward to
Peter:
Today and, you know, really the entire shopping funnel is digital these days. Tell me, what's, what's changed during during this this quarantine pandemic period.
Narain :
So let's say the first thing is just general levels of activity, right? We ha we see sellers being much more active in terms of the amount of inventory that they're listing with us, the amount of shopping posts that they're creating, and the reason these two things matter. These are the primary ways that people are going to discover products on Instagram either because they follow a business or creator who is tagging products in feed posts or stories, or because of business has added products that are in stock to their, to their shop on, on their Instagram profile. That ladder enables that those products to be distributed across places like the, the, the shop home tab on Instagram explore as well as in other areas of we surface products. So those are the two things we see businesses generally being more active. And on the buyer side, we see we see buyers being a little bit more testing new brands they haven't shopped for before.
Narain :
So we see the, obviously one of the things we look at is not only first transaction, but first transaction from this particular brand. So we're seeing a lot more diversity in terms of the shopping behavior and the brands that buyers are trying and equally with. And then to extend a little further equally with sellers. What we see there is in addition, more activity, being more experimental, they're experimenting with the types of shops that they're putting up, the types of products that they're putting in those stores. They're attempting to a sense recreate in some ways what they were doing in physical spaces, sample sales would be one example of this goes back to the point I just made, made around exclusivity. We see that this is a dimension that works really well on this, on the channel. So in some cases we see businesses spinning up temporary handles just to be able to sell a trunk show or, or, or a sample sale, or do something like that. And things like that are working really well. Because again, there's a, there's a real call to action there. So more experimentation, both in terms of formats imagery and creative, the types of stories, connecting storytelling to transactions. That's what we've seen in the past two or three months.
Peter:
That's so beautiful about the platform and that it, it gives, it gives a real testing environment where you can get data back. Cause, you know, for so many of these brands, they haven't been able to control their own destiny on, on, you know, on their channel partner sites that they, that they don't control. And, and here you have a way to be able to try out different content and create different relationships with their consumer and see what works. And, and then you can actually take some of that, those learnings and, and put them to work and other channels that you control.
Narain :
Yeah, exactly. Right. I mean, we, we encourage creative testing. We encourage everything that I just talked about in terms of different formats. For some businesses we see, you know, just very straightforward product imagery is what works well. In other cases, it's really around the lifestyle and the story that the, that the business is is, is telling and, and that's what enables them to build a community and then ultimately leverage that community to drive transactions. So that's absolutely we're, as I mentioned, a couple of times, it's early days, it's not just early days for us. It's in fact, early days for everyone who was building this in a sense, building it together.
Peter:
Yeah. You had mentioned sort of the idea of community. I mean, that's what Instagram and Facebook are built around. And you'd also mentioned earlier the role of influencers on the platform. And I was wondering if you've seen that role shift at all during this time what sort of, how do influencers sort of play this? The, you have a shopping with creators approach. Do you talk about, and sort of the micro influencers versus celebrities what's what's happening right then?
Narain :
Yeah, no great questions. And you mentioned shopping from creators. This is one of the features that we built on top of checkout. So once a business enables a checkout on Instagram shopping, they get access to a feature called shopping from creators. What shopping from creators does is enables a business to extend their catalog, give permission to parts of their catalog, to other Instagram handles primarily celebrities, public figures, influencers, to be able to create shopping media. So feed posts or stories that tag products from that business catalog drive to that business's product details page and checkout flows. So that's functionally what the product does. And again, we've seen again, a lot of experimentation here, different to what we've seen before. We've seen businesses do a combination of working with larger celebrities and public figures. We've seen businesses also work with other businesses. So for example, in the early days we tested this right Vogue or other editorial authorities would give, acts would get access from a brand and then create editorial around a brand.
Narain :
That's something we've seen as well. And one of the more interesting things was a couple of weeks ago, we saw a Neo game and the author, a tag, his new book, or his new edition of American gods, which Harper Collins had put into their checkout catalog. And that drove, drove a ton of activity around that. And what's interesting there that really goes to the heart of this, right? Neil Gaiman has a substantial following on Instagram, but this is really his community, right? This is really who has a high affinity for, for, for someone like Neil Gaiman. And what's interesting, there is that idea of affinity. You don't want perfect overlap between the business and, and, and, and businesses, followers, and they're and they're the influencer or creators followers that that they've chosen to work with, but you do want some affinity there. Some overlap of course, makes sense. So that the community who follows an individual recognizes what it is that that business is selling. So you do want that some affinity there. So again, a lot of experimentation, new categories and things like that, that, that's what we're seeing there.
Peter:
And as always, I think authenticity is the key.
Narain :
Yeah, yeah, yeah. Very much. So that goes to that idea of affinity, right? If, if someone was a true spokesperson for what it is that they are endorsing positioning, then, then that obviously does make a big difference to the people who follow that person or business. Yeah. It's just saying in the examples that
Peter:
You're rattling through really span a few different categories, right. When you think about who ought to be planning a strategy to make use of these capabilities, what categories do you suggest is it across the board? Like what, what, what have you found is, are the places where it really works?
Narain :
Yeah. So here, I'll start with Instagram shopping and then zoom out a little bit to include Facebook as well. First and foremost, I would point to the capabilities that the surface has offered. So on Instagram, as I mentioned, once you onboard to checkout, you also get shopping from creators and you've got something that we call product launches or drops. So the ability to tease and hype a product before it actually goes on sale and have people opt in to receive reminder as both a 24 hours before the product goes on sale. And 15 minutes before it goes on sale, if they don't already have their payment credentials on file, they can go ahead and add those before the product goes on sale. So that for example is a capability that a lot of businesses can't actually easy spin, easily spin up on their own website, right?
Narain :
So that's one capability to which you might want to have worked. Instagram shopping with checkout for similarly, shopping from creators is another one. And then on Facebook, I would point to the reach. We have a lot of people on our platform, and that's one thing that Facebook marketplace, for example, it gives access to the significant amount of people visiting, not just Facebook, but specifically the marketplace tab within Facebook. So reach and distribution is one of the other things. So if those are capabilities that you're looking for taking advantage of for your business, and you're primarily in the business of selling physical goods, we don't really support virtual goods at this point in time. Then, then we would say, this makes sense. And equally, if you already are a, an advertiser on Facebook and you see that our ads are working for you, that's another opportunity to test expanding your distribution through both Instagram shopping at Facebook
Peter:
Know for a number of brands they're thinking about direct to consumer in this moment, perhaps accelerating their, their strategy in order to be able to, to diversify the channels that they're on. How should somebody, that's starting to think about that process, think about the Instagram and Facebook possibilities, and when they don't have the sort of the backend set up to be able to do this, to selling and fulfillment how can they still
Narain :
Leverage your channels for their, for their business? Yeah, I know it's a great question, Peter. And here, I would point to what a lot of direct to consumer businesses, how they grew up on the platform, right? And they really started with that idea of storytelling and community building that I've referred to a couple of times over the course of our call. And here it is the opportunity to almost pre-build and an audience and market for the products that you will eventually sell or eventually sell online. If you presently don't sell them online or don't sell them through your own channels. Right. And that's where experimentation with the balance between stories and feed posts. Is it your own voice? Is it many different voices from across the community, working with influencers and creators, you can experiment
Peter:
With all of that here at a relatively relatively low cost, relatively low overhead, and start to see what resonates with, with that community get feedback. Right? If you look at that, that's been another hallmark of, of, of DDC digital native companies, right? They actually engage their community. Say if it's a tech product, what type of features would you like to see at this price point? Right? If it's a lifestyle product, what are needs, what are the jobs to be done for this department? What do you want it to do? Those types of things, right? And really engaging the community and that leaves this kind of virtuous circle. So that's one thing that you can do, even if you're not driving transactions on the platform. And the other thing I mentioned was, again, the relationship between whatever you do on the paid side with ads and what you do on the organic side, are they speaking the same voice?
Peter:
Are they trying to accomplish the same job for you? Or are they doing different jobs? And you're speaking in different voices across these two, because you're speaking to different audiences. One gives you a lot of targeting on the ad side. The other gives you potentially a lot of reach on the organic side. So I would think of using these tools for the Stickley. Yeah. Yeah. When you think about cause companies or are you just talked about organic and companies are very used to investing significantly in optimizing SEO for their, for their traditional retailer channels, how do brands think differently about SEO when it comes to social commerce?
Narain :
Yeah. And another great question. So search is really great for harnessing bottle bottom of the funnel intent, right? Once someone knows what they want, they've done their research, they know the price they're ready to pay. They know the features that they're looking for. In many cases, they've already made up their mind about the brand. We're a handful of brands. And now they're just looking for where they're going to buy the product from that's, what search is really great at. And that's what SEO is all about, right? The metadata around products, what social and our channels really offer an in is, well, what sits above that, right? What is the, how do you define a total addressable market for your product or product or product range or brand who are those people? Where are they? And again, there's a lot more room for, for experimentation. And again, this balance between what you do on the paid side, on the organic side of those, how those two compliment each other and work together.
Narain :
So it's about moving up in the funnel. It's about understanding what the parameters of your addressable market looks like. It's about understanding here's my existing customer base. Am I just trying to, in the business of trying to retain those and sell more to them, or do I want to go beyond that and expand, and really focus on retention, sorry, acquisition and driving new, new, new customer acquisition. So it's asking yourself those questions and then having a sandbox in which you can play and experiment to, to really push the outer bounds and constraints of, of that addressable market for your product. So that's how I would think about it. And once you start seeing what works, then you can go deep and double down on a strategy that is, that is driving again, whether it's acquisition of new customers, retention of existing ones. And I think
Peter:
Even with all of the science, you can put behind it at the end of the day, particularly on, on the platforms that you represent, the shopping journey is a very emotional process, right? The people feeling a connection being inspired. What, when you think of some of the brands that have been most successful using this approach, how do they, how do they think of the shopping journey? And cause in some cases, you know, on some platforms, it's a get in, get out. Like, I want this thing, I just want to transact it done, but it seems like that journey is a little bit more complex and individualized in, in the kind of an Instagram or Facebook environment. Tell me a little bit about the things that jump out at you and from what you've seen be successful on the platform.
Narain :
Yeah. And here I would echo when I'm build on some of my previous points about storytelling and community building and given the current circumstances, these are an opportunity for all businesses to kind of work on, on, on, on these two. So some of the things I would look at again is that if we look at the balance between what you do from a paid perspective, which offers both reach and targeting and an organic perspective, which really offers the ability to tell an authentic story, build an audience, and then over time, you know, reach, reach a large portion of that audience and how do these two work together? So it's about what resonates with that audience. It's about testing different, both forms of media, building a tone of voice and those types of things on the organic side. And then if we go back to some of the examples I mentioned earlier, right?
Narain :
Once you have an audience that you're speaking to and have a tone of voice that you're speaking to them in, what are, what could you do in the real world that you can't do in the real world right now? And how could you potentially recreate that digitally on, on our platforms. And one example I gave earlier was this idea of Snapple sits, right? Sample sales can work very well online because it's a limited amount of inventory that's available for potentially a limited period of time. So that's one example that I took. Another one is going back to this idea of involving your community and will, what types of product features would you like to see? What, at what price point, asking those questions, doing a limited run of that inventory and saying, here is X units available of the product that you asked for it's available right here, right now.
Narain :
That's another way of doing it, right? So you start to leverage what the digital world offers you, that the physical would be much harder to execute in the physical world. That's the second example. So the first one is recreate what you do in the physical world digitally, the second being mobile, what are the unique characteristics of the digital world that you can't cap or would be hard to execute in the physical world? And then once you start to see, and this goes back to a point I also mentioned earlier, once you start to see which of these strategies of paying off double down, start to scale against these if you have had a physical business that you know, is constrained by its addressable market, because if you have one store in a single location, well, now that constraint goes away, how do you embrace that? Yes, it means doing a lot of things you didn't do before, right? It means getting good at fulfillment means getting good at a remote customer service versus in person customer service. Right? But once you start to see what strategies you pay off, you can then scale in a way that you couldn't before, because the constraints were fiscal. So those are some of the things I would at, if, if that's what you were looking for,
Peter:
That's totally what I was looking for. And as you were talking about, it made me think about the difference in, in the in the shopping journey versus some of the other digital channels that people are relying on right now, like an Amazon or any of the other sort of more traditional I'm coming here with an intent for a particular thing. And I just need to be able to find it and get out. You know, I obviously think of, of an Amazon and you know, I've seen quotes from Instagram, talking about Amazon fixing, buying, and breaking shopping. And I was wondering what you mean by that. And, and what would Instagrams alternative
Narain :
Phrase be for how you guys think about this? Yeah, actually I think that quote was originally attributed to Emily, vice the CEO of, of Glossier. And I think what she's getting to is, and what's at the heart of that quote, right? Is that the internet has done a great job of addressing what you've mentioned, right. Which is intent based, shopping features, price brand, and then really just making the decision of where you're going to buy it from based on your sensitivity to price or your needs in terms of, I need it today. I need it in three days. Actually. I don't mind when it arrives those kinds of dimensions, right? So that's very, very well catered for, but this idea of discovery and that's really what, what we've seen our opportunity, be this idea of discovery, not knowing what you are looking for until it finds you that idea of digital serendipity and what we've called serendipitous shopping that has, we think remains a substantial opportunity and why we think it's a substantial opportunity to me.
Narain :
Cause it's, you know, in many ways effectively infinite, when you think about it, right, it's around some elements of personalization. What resonates to you personally, not just about the utility of shopping, but actually about the joy and the experience of discovering and shopping. And we've always thought of it as a spectrum at one end is the very well catered to end of intentful shopping. And at the other end is this idea of serendipitous shopping. As I mentioned, not knowing what you were looking for until that product or brand finds you. And then obviously you have something in between, right? And you can, the other classic construct is, is the funnel and this idea of consideration awareness consideration, and then intent, right? So a couple of different ways to, to, to look at it. But the idea here is that we're bringing a bunch of different things together in a single place where you discover where you're interact with a brand. And now also where your trends,
Peter:
That's where I think the discovery process as a con, as a consumer myself, is so rewarding in a way that feels different from, from what I had experienced prior. And I think I'm thinking particularly of Instagram, w we we needed a new bed recently and through the Instagram platform discovered Thuma and it's been such a wonderful experience with that brand from beginning to end. And I, and I think that particularly the brands that lean into this idea of community and relationship and discovery that matches so well with the building themselves around an ethos. Yeah, absolutely. Yeah. And, and and I, and so in that experience, I, I think of, of leaning into that. And if I, you know, just to close out our conversation, I think about the brands that are out there trying to, to imagine themselves taking advantage of this opportunity and needing to sort of make the leaps that are required to do that. And I was wondering with the brands that you've onboarded during this sort of introductory time, what do you find in their organizations? What are the muscles that they need to build? There are strategies that need to be developed in order to be able to play in this environment you know, with, with skill
Narain :
Agility. Yeah. It's interesting. This is something we were actually just talking about in a cup, in a meeting that was in a couple of hours ago. And it's, we look at both ends of the spectrum, right? And it's interesting at the very, at the end, we have very large sophisticated, you know, agile, digital first companies who are multinationals they've tipped the way they've typically done. It is build a digital team within the larger organization. That's focused on agile execution, right. And they can do that because they have the resources to do it and they can fast. And at the other end, you have small digital native businesses, which is often one, or just a handful of people who are just getting started out. They can also move fast because there's no organizational silos or hierarchy where I've seen struggled as everyone else in the middle.
Narain :
That's exactly where you've typically had fairly siloed parts of your organization. You have a team that handles your digital marketing, right. And they know everything around building product catalogs and feeds, but only for ads, right? Then you have another team that develops, develops for social content, right? And those two, and then you have your eCommerce team, which, you know, services to some extent, both of those teams, but is also disconnected from those teams, right? And when you look at those three teams, they have different skill sets. They are measured by different KPI. The social team is probably not gold on driving transactions, but now if they're being asked to create content, that goal is to drive transactions. Then their traditional KPI kind of go out the window, right? Potentially they're producing
Narain :
Beautiful posts that the production cost is too high at a proposal level to actually justify using that for commerce purposes, because the ROI is not going to look great on that because it costs too much to create that post relative to the number of transactions that the post is going to drive. If you use transactions based methodology, right? So this is both an organizational challenge, as well as a metrics and KPI and ROI measurement attribution challenge as well. So there are multiple dimensions that as I mentioned, small, very, very, very large companies have the resources to tackle it. And very small ones are just organized in a way that enables them to move fast and tackle it. But everyone in between we, we, we've had a variety of conversations with businesses around, if, can you carve out a single unit to tackle this? If you can't, then what's the common denominator metric that you're going to look at to describe success or failure to this, to this endeavor. So those are the types of conversations that we're having, but it's a very good question. Yeah. So often
Peter:
We, across across brands, we do see where the, the desire lines lines up the, the teams are, are willing to work together. But if you don't modify the incentives, and if you are your KPIs, aren't clear, then, then you don't get the right behaviors. It's just human nature.
Narain :
Exactly. It is all about incentive alignment. And, and, you know, on the one hand you can always park something on, under an innovation umbrella, but crucially, that innovation needs to actually, at some point connect back to the core of your business. Otherwise it's some, anyone who's driving that innovation agenda will get asked the question, well, why are we doing this? Right? So I think that's important too. You do that for a time, but you can't do that indefinitely.
Peter:
The fun of what it must be to be driving the, the partnership sort of putting together this ecosystem that is allowing these experiences to come to life must be so exciting to be in the middle of them. Watching brands take this on for the first time. Are there, are there things coming down the pike that you're allowed to talk about, the people can just start to set their mind to in terms of thinking what's, what's coming next, that might be open to them.
Narain :
Yeah. So if you, you can read the tea leaves of what I've just said over the course of this conversation. And a couple of things will probably stand out to you. So this idea of storytelling, community building, that's something I've mentioned a couple of times, so what tools are missing that we could build that help you do a better job there, as well as the other area, how do paid and organic work more effectively together? So last year, we also, for example, released a simple way to, to understand the attribution of non checkout, Instagram shopping, how, what type of traffic does it drive to your website? So this example of the types of things that we could build to help you better understand the value and how, and how your paid and organic activities on, on Instagram and Facebook work more effectively together. So those are the areas that I would look at, but all of this really is based on market feedback and trying to support some of the things that we just talked about in terms of how do we give businesses, the ability to measure the success of, of what they're doing on our platforms, right?
Narain :
That's, that's something we've always tried to do, and we'll continue to try to do it in a way that speaks to what the direct asks that we have from our partners, both platform partners and individual businesses.
Peter:
Well, no, man, thank you so much for joining us and talking about the capabilities that are developing here and really the frontier of social commerce. We really appreciate it.
Narain :
No, thanks a lot, Peter. I really enjoyed this so happy to come back, anytime,
Peter:
A big, thanks to Lorraine for sharing his brain today. If you have more questions about social commerce or other topic ideas, you'd like us to cover, please hit us up at our digital shelf Institute, LinkedIn page. Thanks for being part of our committee.
