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Facebook is leaving no stone unturned in its search for what the social network calls “the next billion users.” Having achieved almost unparalleled reach, there’s nowhere to go but up; it needs to keep accreting users lest the brilliant star starts consuming its own energy and collapses into a supermassive black hole.
Well, that certainly sounded dramatic.
But there lies the conundrum for Facebook right now; where do you go when you are the most widely used social network on the planet (and there’s no one else in the solar system to go after, unfortunately)? You need to make yourself even more ubiquitous by diversifying your service; by offering your users more reasons to stick around for longer; by attracting users who would normally not use your product.
Buy and sell locally
After moves like revealing its new Slideshow product last week and making progress on Free Basics (previously known as Internet.org), Facebook’s next big thing to capture audiences (and ad revenue) may have become a clearer. TechCrunch reported that some users noticed a new feature on their Facebook app for iPhone, called Local Market.
This is what Local Market could look like on Facebook’s iPhone app.
From the looks of it, Local Market will be a peer-to-peer marketplace living inside Facebook’s mobile and web apps, where users can browse through a wide array of items to buy, or upload listings to sell their own stuff. Categories include clothes, home appliances, electronics, toys, beauty items, even antiques. The Local Market will apparently connect users with others in the vicinity looking to buy or sell, creating a sort of perpetual digital garage sale.
This kind of P2P ecommerce has been going on for a while within the social network. Users have taken advantage of the group functionality to create communities out of buying and selling various things, particularly in (although certainly not limited to) emerging markets. And the company has already integrated features like an instant “Buy” button in some of those groups to facilitate the process. It makes sense that the next step is a fully-fledged marketplace.
Disrupting the disruptors
But where Facebook sets its great eye, troubles may soon arrive. A lot of the markets it’s looking to grab are currently served by ecommerce startups who identified that gap early and moved to fill it. In Southeast Asia, P2P marketplaces abound; from Singapore’s Carousell to Indonesia’s Tokopedia and Bukalapak, online businesses and communities have formed around the concept of connecting individual buyers and sellers, and even small businesses with customers.
When (or if) the Local Market feature is launched, it will come precisely for this market. And like with several of its services, the US company can wield its immense user base and massive war chest as a blunt instrument to try and neutralize competition. There are users in countries like Indonesia and Myanmar in whose minds Facebook is the entire internet. While it’s not a given that users and merchants will be forced to choose one marketplace over another, the cold, hard fact that allows Facebook to win over and over again is the same it’s always been: it’s where the people are.
Resistance is futile?
The local companies’ advantage may be their established presence in the region. Tokopedia was founded in 2009, Bukalapak in 2011. Carousell is a relative newcomer, having been founded in 2012, although it has managed to scale by expanding out of Singapore and into Malaysia, Indonesia, and Taiwan.
They’ve had time to refine their product, identify their audience’s needs and cater to them, and iron out the kinks. They have dedicated users that have formed communities around them. In fact, Carousell just announced the launch of its web platform, allowing users of the mobile-first marketplace to use their desktop to buy and sell just as they would on the app (interestingly enough, using ReactJS tech that Facebook developed and then made open source).
The company also announced it has had 26 million listings to date and sold 8 million items through the platform. It also said it has received 140 million web page views to date. According to SimilarWeb, Carousell ranks #30 in Singapore in monthly usage, while Tokopedia and Bukalapak rank #19 and #27 respectively in Indonesia. That’s nothing to be scoffed at – unless of course you’re Facebook.
Given that Facebook’s buy and sell groups have proven popular, there’s good reason to believe that Local Market will be too. Assuming it is able to offer a superior experience out of the gate, it has a strong chance of capturing a large chunk of the market in one fell swoop. Faced with that, it might be worthwhile for existing marketplaces to see if and how they can work with Facebook on this, rather than stand against it.
For its part, Carousell is adopting a wait-and-see approach, as it focuses on what it does best. “We believe that competition is further validation that the problem we’ve set out to solve is indeed a meaningful one, which resonates with many people around the world.” the company tells Tech in Asia. “Our focus is really to keep our heads down and continue iterating our app and our web platform to better serve our community’s needs. We’re also focused on bringing Carousell to more markets with the aim to fulfil our mission – ‘To inspire the world to start selling’.”
What do you think local P2P marketplaces’ chances are if Facebook decides to move in on this space? Is it better to fight or collaborate?
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