Facebook’s head of ecommerce and retail, Martin Harbech, talks to Drapers about how the social platform is helping fashion retailers to convert scrollers to spenders.
Q. Why is Facebook relevant to fashion retailers?
Fashion is a big focus area for us, and we work closely with our partner retailers to increase their understanding of their customers. We allow them to communicate with customers in a meaningful way by connecting them at the right time with the right message.
Retail used to be about a personal connection; retailers would know shoppers by name and they would know their personal style, but as the high street grew that personal connection disappeared. We are trying to bring it back by making retail more personal. We use the retailer’s understanding of shoppers and combine it with our understanding of people and our technology to make retailers more relevant and timely in the way they speak to customers and potential customers.
Q. What’s the best way to achieve this connection – advertising or content?
It’s usually a combination of the two. It’s very effective if you prepare the customer with content before the advertising goes live: Shop Direct’s Black Friday campaign for Very.co.uk was a great example of this. They used a simple video solution to tease shoppers about the upcoming event, then followed it up with our Dynamic Product Ads when specific offers when went live.
Dynamic Product Ads are a form of sequential story-telling that guides shoppers to the most relevant products for them. If you rely on cookies, phones and laptops, for example, are seen as separate devices so you can’t communicate in the most relevant way. We are trying to create the most advanced personal recommendation engine the world has ever seen and Dynamic Product Ads tap into that. It’s about trying to figure out what product is most relevant to that customer at that moment. Canvas ads are another example of how we are developing. They are fully customisable ads that take over the full mobile screen and retailers can add a mix of video, still images, text and call-to-action buttons.
Q. Mobile shopping is expanding rapidly. What opportunity does this represent for retailers using Facebook?
The shift to mobile [usage] is the biggest shift we are seeing in retail. In many ways, mobile is as disruptive to ecommerce as ecommerce was to traditional retail, and many retailers still don’t know how big of an impact it’s having. The discovery of product often happens on mobile. People discover new content all day, every day, on Facebook and Instagram and that includes products. Retailers need to understand how people discover their products and why they end up buying them.
When it comes to mobile, we are the biggest platform by far in terms of time spent – one in five minutes in the UK spent on mobile is spent on Facebook – so we’re in a privileged position. We can map out that journey for retailers to give them a single view of customers.
Q. Will Facebook Messenger play a bigger role in retail in the future?
Messenger is a big opportunity in changing how people communicate with brands. We try to help retailers speak to their customers and Messenger is the perfect solution. If you bought a product and want to have a follow-up conversation, why not do it in the same way you would communicate with friends and family? It is an area we are investing in a lot as one of the next big things for retailers.
Q. Will we see a return of Facebook shops?
Right now, our focus is on discovery and helping to guide people through products, then at the end we pass over to the retailer. But we wouldn’t rule out a return to Facebook shops in the future if that’s what retailers want.
Q. Are the number of ‘Likes’ a retailer has still important?
Likes are still a good indicator of certain things, but a like is not a business objective. We want to deliver meaningful business results, such as incremental increases in sales. Likes don’t pay your bills.
Q. With the influx of new social platforms, how does Facebook stay relevant?
People will always use lots of different platforms, but we look at whether people keep coming back to us every day and we have more than 1 billion people doing that consistently. They come back to Facebook because every single newsfeed is unique and that’s what we are continuing to invest in, making that newsfeed as relevant as it can be. The amount of content available is growing exponentially, so we are constantly working on what is the most relevant content to that person at that particular time.
Q. How does Instagram differ to Facebook from a retailer point of view?
Most retailers use both and we encourage that. We can optimise and push out content on each platform based on the audience they are trying to reach or they can have bespoke Instagram content. A lot of retailers are beginning to see the opportunity of Instagram, particularly in fashion as it is so visual. They use Instagram to create the look and feel, then they follow up on Facebook with a targeted ad. The results far exceeded other campaigns. It’s about personalisation at scale – a small change can make a huge impact.
Very.co.uk case study
Shop Direct’s website Very.co.uk reached out to Facebook in 2015 to experiment with the platform’s Dynamic Product Ads and saw £3.5m incremental sales as a result.
The Dynamic Product Ad campaign allowed Very.co.uk to promote its more than 50,000 products on Facebook, across both desktop and mobile, by automatically pulling in images, product names and prices. The company targeted people who had viewed, clicked on or added a product to their baskets in the previous 14 days, while excluding anyone who had already made a purchase.
Very.co.uk saw a 12-times incremental return on its £290,000 spend and James Fitzsimmons, paid search executive at Shop Direct, said the campaign reduced conversion costs and “far exceeded” its target of incremental return.
“The results have been above our expectations, with incremental return on investment far exceeding our target. Not only do they allow us to capture conversions off the back of upper-funnel campaigns on Facebook, they also act as an always-on retargeting activity and now play a key role in our digital strategy,” he added.
• 1 billion people use Facebook every day
• 36 million people in the UK use Facebook every month
• 1.4 billion people accessed Facebook on mobile devices in December 2015, up 21% year on year
• 90% of people who use Facebook access it via mobile
• 8 billion video views and 100 million hours of video are watched daily on Facebook
• 4.5 billion Likes are shared and 10 billion messages are sent on Facebook everyday
• 50 million small businesses have Facebook pages and 3 million of these advertise with Facebook each month
• 1 billion people on Facebook are connected to at least one business
• 1 in 4 minutes spent online on mobile in the UK are on Facebook and Instagram combined
• 82% of Facebook ad revenue is now generated from mobile, from zero four years ago
Martin Harbech CV
• September 2001 to December 2005: Product manager and buyer at computer and software retailer Proshop
• January 2006 to April 2007: Business development manager at computer game retailer Softxchange
• September 2007 to August 2008: Partner associate at Google Partnerships, Google
• September 2008 to May 2009: Senior partner associate at Google Partnerships, Google
• April 2009 to December 2010: Partner strategist at Google Partnerships, Google
• January 2010 to January 2011: Manager at Amazon Marketplace, Amazon.co.uk
• January 2011 to January 2013: Senior manager at Amazon Marketplace, Amazon.co.uk
• January 2013 to May 2015: Category leader at Amazon Retail, Amazon.co.uk
• May 2015 to present: Head of ecommerce and retail at Facebook