Are Group Deals & Flash Sales The Next Big Thing In Facebook Commerce?

As more and more brands are opening up shop on their Facebook pages it is becoming increasingly important to find ways to reward customers for purchasing and sharing. As a result, we are seeing an influx of special offers like group deals and flash sales hitting Facebook commerce stores. I had the opportunity to speak with several leaders in F-commerce—SortPrice, Zibaba, and WildFire—to find out more about how these deals work, why they’re great for creating a buzz, and how they play into the future of F-commerce.

As more and more brands are opening up shop on their Facebook pages it is becoming increasingly important to find ways to reward customers for purchasing and sharing.  As a result, we are seeing an influx of special offers like group deals and flash sales hitting Facebook commerce stores.  I had the opportunity to speak with several leaders in F-commerce—SortPrice, Zibaba, and WildFire—to find out more about how these deals work, why they’re great for creating a buzz, and how they play into the future of F-commerce.

Who I talked to…

Before getting into the nitty-gritty of deals on Facebook, I’ll quickly give a little bit of background on the three companies that I spoke with.  The CEO and co-founder of SortPrice, Doron Simovitch, was the first person I heard from.  SortPrice offers a Facebook store application that makes it easy for brands to create stores on their Facebook pages.  SortPrice does not currently give users the option to offer group deals, but they are a forerunner in Facebook Flash Sales.

Michael Katz, the VP of Business Development at Zibaba also provided input.  Zibaba is one of the first online storefront apps to offer users the ability to create group deals and offers.  They also offer a unique affiliate program that lets outsiders promote a brand’s Facebook shop.

Finally, I heard from the CEO of Wildfire, an application that specializes in group deals on Facebook.  Read on to find out what this triad had to say.

How do Facebook flash sales work?

Doron Simovitch of SortPrice explained how flash sales work on Facebook.  Basically, a flash sale is a timed sale that offers a deal for users for a very specific window of time.  When a user sets up a flash sale via SortPrice’s storefront app, “the flash sale goes live immediately on the merchant’s Facebook store, with a product image and description and a countdown clock alerting shoppers how long they have to take advantage of [the deal]… fans can visit the merchant’s Facebook store to take advantage of it, with the transaction being completed on the merchant’s actual website.  Fans also have the ability to like a flash sale, comment on it, and/or share it with other Facebook friends, giving it a genuine shopping feel.”

How do Facebook group deals work?

While Zibaba plans to offer flash sales in the future, they are currently focusing their efforts on group deals and Michael Katz explained to me how Groupon-style deals work on Facebook.  “Group deals are a very easy way of generating buzz around a specific product and increasing sales for that product.  Owners can select any item from their existing catalog of products to easily create a group deal by specifying the amount of discount, the start and end date and time, and the minimum and maximum number of participants.”  Within minutes, they’ve set up a group deal on their Facebook page.  Once the minimum number of participants have signed up, they all get to purchase the product at the discounted rate.

While Zibaba offers group deals as part of their storefront app, Wildfire is focused solely on helping brands create group deals for their pages, not entire F-commerce stores.  Through the Wildfire app, brands are able to crate a group deal page, hosted on their Facebook fan page.  See the example below.

What are the benefits of running special offers on Facebook?

According to Katz of Zibaba, “Merchants are seeing less value for their brand when they run group offers through third party sites.  They end up with no additional brand loyalty, very little sales of regularly priced items from the group buying customers and no direct interaction between their brand and the ‘bargain hunters’.”  When you reward your Facebook fans, you effectively target the people that are already your customers, increasing brand loyalty and encouraging sharing.