ShopIgniter CEO Matt Compton on Raising $8M and the Growth of Ecommerce on Facebook

Founded back in 2008, when social shopping was an exciting but unproven idea, ShopIgniter has been building its business among clients who have real-world goods to sell online, with a focus on Facebook. And like some of its rivals have recently, the Portland, Ore. company has raised more funding, an $8 million second round led by Silicon Valley venture firm Trinity Ventures with existing investor Madrona Venture Group participating.
The new interest is because brands that had been focused on gaining Facebook fans in past years are now looking for what do next, as chief executive Matt Compton tells us in an interview today. For many Page owners, that means selling direct. ShopIgniter has a set of interlocking products aimed at meeting this emerging need.
One is a customizable white-label application for Pages, with ways to adjust the look and feel to match the page, tools for easily sort through product offerings, and other features seen social commerce apps. The Portland TrailBlazers basketball team, for example, has been using it to sell team merchandise on its Page. Compton tells us that in a recent test between on and off Facebook sales for a brand, conversions were twice as high on Facebook.
A ShopIgniter product called the "Social Promotions Engine" reaches further into Facebook, helping Page managers create custom campaigns designed to get users sharing content about the brand on their Walls and news feeds in order to generate sales. In an example detailed by Ryan Spoon, Nike promoted a limited set of collectible golf balls to fans of its Page. The contest winners got free golf balls, and Nike was able to increase fan awareness of and interaction with the store. Finally, participants were also encouraged to share a news feed story about their winnings with friends.
For the Blazers, Compton wrote last month, promotions like these resulted in the Page fan count growing by 25% and, perhaps more importantly, transactions conversions originating with Facebook friends growing by 16%.
Beyond the application and promotions, ShopIgniter also provides a white-label ecommerce product for web sites. The point of it is to go beyond more general online ecommerce management products, instead capturing commerce around social interactions wherever they happen. For example, one customer may go to a web site, find a product they're thinking about buying, click the Facebook Like button, and generate a story about it in their news feed. Their friend might then click to look at the product, be taken to the Page of a company with a ShopIgniter store, and buy the product there. Meanwhile, the person who Liked the product on the site might still go to the site when they decide to complete their purchase.
A variety of competitors in the business provide their own variations on social commerce applications — some we've looked at include 8thBridge (formerly Alvenda), which announced a $10 million second round in late May, and Payvment, which added a $6 million second round in December.
With client lists growing and venture capital firms doubling down, the non-virtual goods part of the platform appears to be coming of age. We just kicked off a series on social commerce in our Facebook Marketing Bible subscription service. Stay tuned for more.

Facebook Announces PayPal Payouts to Developers for Credits Revenue

Facebook announced this morning that developers signing up for Facebook Credits now have PayPal as a payout option, increasing the flexibility developers have for monetzing apps through Facebook Credits.
This is of particular importance to developers in countries where PayPal is really the only trusted payout option for developers. Payout is the means by which a developer converts in-app currency exchanges to real money that the developer can then deposit into its bank accounts. Facebook says that the PayPal option now doubles the number of countries where developers can begin integrating Facebook Credits to 22 countries total, including Turkey, India and Japan.
Facebook Credits has been a slow road for certain social game developers in the last nine months between apparent reluctance and technical issues. The mandatory integration deadline for Facebook Credits within social  games is July 1. It is not clear if Facebook will extend the deadline for remaining countries that are experiencing difficulties with integration tied to payout complications. PayPal currently serves over 190 countries.

Why Facebook Ads Are Undervalued By 800%

Facebook advertising is even more powerful than previously thought.

Advertising efficacy is usually assessed using the “last click,” meaning that the point of interaction right before the conversion is considered.  But this methodology has become outmoded in the context on Facebook advertising because people simply aren’t in buying phase when playing around on the social network, making it highly unlikely that a brand advertising on the site will get an immediate conversion.
Most Facebook ad clicks lead to a conversion at a later time and through a different channel. But last click analysis would have inaccurately attributed these conversions to last channel in the purchase path.
Quite often this shows search as the beneficiary because when people are ready to buy something online, what lazier way is there to navigate to your chosen brand website than by quickly searching for the site?
My experience of analyzing advertisers’ Facebook advertising conversions shows that between five and eight times as many sales from Facebook happen on a first click basis rather than last click.
Last click valuation refers to focusing on the advertising channel that a customer most recently interacted with before converting to a sale. Let’s instead consider Facebook to be the first click in a sequence of interactions that ultimately leads to a conversion on any channel.
For higher consideration purchases, where the length of time to conversion can be several days or weeks, this type of analysis is particularly important.
A typical example is the travel industry where we are seeing more than 30 percent of conversions take longer than 7 days from the first visit to final conversion. This has a big impact on measurement.
The result for travel is that awareness creating forms of advertising such as Facebook are often either the first click in this process or an assisting click. In the samples we analysed Facebook was the first click in the transaction over 3.5 times more than when it was the last click. This ratio increases up to six for assists.
When compared to other channels this is one of the highest ratios — showing the power of Facebook’s influence on other channels. The main beneficiary being paid search where more than 40 percent of transactions converted on price per click where Facebook was an assisting click.
Another interesting statistic we uncovered was that the average order value increased with the longer paths to conversion. This makes sense since the bigger the purchase, the more
thought goes into it. This adds another dimension to the importance of accurate tracking andattribution, particularly if last click (as a method) is undervaluing the order values as well as the transactions.
Grant Muckle is the managing director of I Spy Labs.

Google Leads Investment In Facebook Gamer Kabam

If you play Facebook games, then you are familiar with Kabam games. The company is the maker of Kingdoms of Camelot, Dragon of Atlantis and Glory of Rome. The company receives $85 million in a financing round led by Google’s venture arm, helping the startup expand in Asia, hire developers and make acquisitions.

The investment is also being co-led by Pinnacle Ventures, and now values Kabam at about $500 million. The Bay Area company has raised $125 million since it started five years ago as a sports and social media group, but transformed into creator of social games. Kabam was formerly called Watercooler, and changed name last year. The size of its personnel has shot from 25 to 400 since 2010.
Click here to read more on Social Times.

PastPost Recalls What You Did On Facebook Last Year

Can’t remember what you did yesterday? Yeah, we can’t either. Well, a new application intends to fix that.
PastPosts, created by tech veterans Jonathan Wegener, Matt Raoul and Benny Wong, sends users a daily email — if you didn’t log in every day last year, you only get messages on days that correspond to when you’d used Facebook in the prior year.
The daily missive comes in an easy-to-read format showing wall comments, posted photos, status updates, and more from your personal Facebook archives.
Wegener said the idea came from an app the guys created for Foursquare a few months ago called 4SquareAnd7YearsAgo that does pretty much the same thing.
“The response to that product has been really positive and thousands of people have signed up and told us they love it,” he said in an interview. “PastPosts is the next logical extension, bringing that same proven concept to the largest personal data creation platform, Facebook.”
“More philosophically, the interesting trend here is personal data exhaust — as we use web services, we’re constantly leaving behind a trail of digital information. We’re helping people re-experience that content as a daily email a year after the fact,” Wegener said.
He brings up a good point. This service is not only a cool idea that can help remind you of what your life was like a year ago, it serves as a reminder that just because an old post isn’t showing up on your wall anymore doesn’t mean it isn’t there.

Ex-MySpace Exec Launching Facebook Alternative

This is probably the most far-fetched pitch I’ve heard yet: a social network billing itself as an alternative to Facebook, created by MySpace alumni.

MySpace, for the few of you that don’t know, literally was the Facebook alternative until Facebook beat them at their own game.
Now there are plenty of social applications looking to fill gaps in Facebook’s experience. There are even a few that are trying to use privacy as the key selling point, just as Altly is.
However, most of these startups never received traction and thus never received an investment of any significant size. Altly appears to be the exception, starting off with a round of funding from some influential investors.
I can understand where the investors are coming from: Use Facebook’s branding to build a brand off of being “the alternative.” Unfortunately, it’s a horrible idea.
Rather than actually launching anything, the company is making its big debut with a long blog post which is nothing more then a rant about why Facebook sucks.
Dmitry Shapiro, the former MySpace executive behind the project, has so many connected friends that he was actually able to convince some of them to give him money on the basis of hatred against Facebook.
Shapiro’s blog post ranting about why Facebook sucks is so long that he needed to post a follow-up summary at the end of it. Rather than posting his summary, I’ve decided to take the liberty to translate what he’s really saying — I’m going to alternate between quoting him and then commenting:
Many people are friends with their co-workers, their bosses, business partners, and casual acquaintances. In fact, we feel pressured to become friends with all kinds of people that we would not normally have frequent communications with.
Dmitry clearly gave in to the pressure and now his life has suffered because of it. Like he rants:
Facebook makes it difficult to configure privacy settings and to target messages towards specific groups of friends, therefore encouraging us to broadcast our activity to every one of our friends. And since many of us have our share permissions set to friends and friends of friends, a Facebook default, we are inadvertently sharing not only with our friends but also anyone that is friends with them. With the average Facebook member having 130 friends (Source: Facebook statistics May 2011), sharing with friends of friend” means that you are not just sharing with your 130 friends but with 16,900 people.
In other words, “I’m mad because I accidentally broadcasted out something that I didn’t want one of my friends to see. I really have no idea to use Facebook’s privacy settings and frankly I could have made $1,000 in the time it would have taken me to configure them.” He also says:
To add to the complexity of understanding who sees our personal information and interactions, Facebook has a long history of changing privacy settings, without first alerting users, and exposing our private information in ways that we did not intend.
Get mad! Facebook is screwing you over and you have to put up with it. Do you really want to live life being pressured by Facebook when you are sitting in front of your computer? Hell no. I’m leaving and you should too. Who’s coming with me?!  Nobody? Okay, well how about this:
Mark Zuckerberg, Facebook’s founder and chief executive officer, claims that Facebook is simply creating a tool that facilitates our natural movement away from privacy. What he fails to acknowledge is that Facebook EXERTS its power over how we communicate and is FORCING social norms to change.
Mark Zuckerberg is telling you how to communicate. Are you going to put up with that?!
A recent CNN story titled “Young job-seekers hiding their Facebook pages” says that “A recent survey commissioned by Microsoft found that 70 percent of recruiters and hiring managers in the United States have rejected an applicant based on information they found online.”
People should be able to act like stupid idiots and it should have no repercussions on them! Don’t you want to act stupid? I know I do! Come join me on Altly where you can act stupid all the time and nobody will see it! (We know the real reason nobody will see it: nobody will be on it.)
Facebook, by forcing our communications to be more and more public, creates an environment where they can allow advertisers to better target advertising to us. Targeting of ads online is not new, but the amount of information that is collected by Facebook, and then exposed to advertisers for targeting purposes is DRAMATICALLY beyond that of any service that has ever existed.
Look, I know that MySpace used your information to target ads to you . But seriously, folks, Facebook has much more data than MySpace ever did and it’s far better structured! (Damn, Facebook was smart.) Do you really want Facebook knowing all that stuff about you?!
There is clearly nothing wrong with Facebook making money, as all business has to do. What IS clearly wrong is when our privacy, our personal information, our digital lives are being subjugated for the sake of profit, without us having any meaningful capability to opt out, or even know the extent of such activity.
Have you ever tried deleting your Facebook account? Go and try it! Your account is never disappearing and Facebook is going to keep your information even if you don’t want it to.
In fact, they’re going to sneak under your bed and when you are sleeping they are going to steal your wallet. (Someone says, “Really?”) Yes, Really … Facebook would steal your wallet, and your lover. You better hide yo’ kids and yo’ wife, because Facebook is coming after you!!
Now that you know that the Facebook boogeyman is coming for you, don’t you want an alternative? Hell yeah, you do. Well at Altly, we’ve got the solution that will make your life less miserable. Get this, we honor your privacy! That’s right, we are going to let you control who can see the 10 million photos, status updates, messages, comments, likes, wall posts, and all the virtual cows you purchased in FarmVille.
When will it launch? I have no idea because building a system this complex required me to get $1 million before I even started building it. How will we make money? We don’t! We are here to make your life better and that’s all you need to know.

SURVEY: 2 In 3 Small Businesses Are On Facebook

Roughly than two-thirds of small business owners have a presence on Facebook.

That comes from a survey of 1,132 small business owners by found that 68.6 percent, or 591 respondents, use Facebook the most for their business.
Over three quarters of the survey respondents plan to increase their use of social media this year, while almost one in five plan to maintain the same amount of effort they did in 2010.
And 25.3 percent said they update social media several times a day, while 16.7 percent said they posted once a day.
When asked whether they see social media as a viable way to communicate with their customers, 62.1 percent responded “definitely,” while 34.3 percent said “sometimes,” and 3.7 percent said “not at all.”
However, 40.5 percent of the surveyed small business owners said that social media has either met or exceeded their expectations; some 42.8 percent said that it only somewhat met their expectations, while 16.6 said the experience hasn’t lived up to their expectations at all.
It seems like small businesses are only just beginning to hit their stride on Facebook. Readers, what insights do you have based on these numbers?

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