Facebook stops peddling physical gifts (no one wants)
The social network is removing teddy bears, flower arrangements, and cookie baskets from its online marketplace to get serious about selling gift cards.
Less than a year after opening up a gift shop, Facebook said Friday that it will no longer sell physical goods. Instead, the social network will fill the shelves of its Web and mobile marketplace with digital gift cards and hawk the.
"Since launching Gifts in December last year, roughly 80 percent of gifts have been gift cards. So, we're now adding more digital codes and making the Facebook Card redeemable at more merchants," a company spokesperson told CNET. "As a part of this shift in focus to Facebook Card and digital codes, we're also phasing out physical gifts."
The digital-only gift shop experience is getting a new look and rolling out to 10 percent of Facebook users on Friday. All users should see the remodeled Facebook Gifts marketplace next week, the spokesperson said.
Facebook is likely scrapping physical goods, which included cupcakes, mugs, flowers, and clothing from partner brands, to cut down on costs associated with delivery and management. Gifts, as a whole, has only proved to be a marginal side business for the social network. The company has repeated on numerous occasions that it doesn't expect to bring in substantial revenue from the e-commerce endeavor this year. In going digital-only, Facebook can continue to experiment with a revenue stream other than advertising without the overhead associated with physical goods.
The Facebook gift shop will peddle more gift cards from more brands and, in some instances, feature digital codes from partners that were previously only offering up goods for delivery, the spokesperson said. Facebook will also allow members to purchase gift cards in variable denominations for the first time, perhaps making the offering more attractive to buyers wishing to set their own terms.
The company also plans to make Facebook Card, a type of prepaid credit card that people can use to pay at select merchants, available as tender at more stores.
The news comes as the social network's shares finished at anon Friday. Facebook's stock is up a smidgen in after-hours trading.