Is Facebook Gifts Off To A Slow Start? It Appears So.

When Facebook Gifts was announced back in September, there was buzz about how this offering will change Facebook’s entire revenue model. Well, the initial Q4 reports failed to impress with just 0.4% (at most) of users buying a gift according to TechCrunch.

Initial reports were that just $1 million dollars of revenue was driven via Facebook Gifts, but was later debunked due to incorrect data. What we do know is that the number was below the $5 million dollar mark according to a statement made by Zuckerberg on the Q4 earnings call:

“I do want to temper near-term expectations a little bit on revenue coming from other areas like Gifts or Graph Search…Payments and other revenue also included around $5 million from sources outside of games primarily user promoted posts and to a lesser extent from our new Gifts product. While we remain excited about the long-term potential of commerce on Facebook, current revenue from user promoted posts and Gifts is very small, and we expect 2013 contributions from these initiatives to remain very small given current run rates.”

So we know that in the roughly one month (December ’12) that gifts were available, they weren’t being purchased at an overwhelming rate, given the < $5 million dollar number. The official dollar amount generated from gifts hasn’t been released.

Even if the gifts product did generate $5 million dollars, it still wouldn’t make a blip on the social network’s $1.59 billion Q4 revenue. The average Facebook Gift purchase is for $25 dollars, up from the $15 initial projections.

The one-billion-dollar-gift-based revenue projections were based off of every US user purchasing a gift; this, however, couldn’t be farther from the real-life estimate of 0.4% of users actually purchasing.

For more information see the article at TechCrunch.

Related Topics: Channel: Social Media Marketing | Facebook | Top News

Sponsored


About The Author: is the Director of Marketing for Cypress North, a company that specializes in social media and search marketing services and web-based application development. He has been in the Internet marketing industry for 6+ years and specializes in Social Media Marketing. You can also find Greg on Twitter (@gregfinn) or LinkedIn.

Connect with the author via: Email | Twitter | Google+ | LinkedIn



Marketing Day:

Get the top marketing stories daily!  

Share

Other ways to share:
 

Read before commenting! We welcome constructive comments and allow any that meet our common sense criteria. This means being respectful and polite to others. It means providing helpful information that contributes to a story or discussion. It means leaving links only that substantially add further to a discussion. Comments using foul language, being disrespectful to others or otherwise violating what we believe are common sense standards of discussion will be deleted. You can read more about our comments policy here.
  • http://twitter.com/CheapFitness Steve Blackburn

    paying for gifts on facebook is as pointless as the “poke” feature.

  • http://www.facebook.com/larry.penner.14 Larry Penner

    Facebook is off to a slow start and I believe a pointless direction. Thre old Facebook was good, now that changes are being made I believe it will go down hill.

    http://lottostrategies.lottoguy.net/

Get Our News, Everywhere!

Daily Email:

Follow Marketing Land on Twitter @marketingland Like Marketing Land on Facebook Follow Marketing Land on Google+ Subscribe to Our Feed! Join our LinkedIn Group Check out our Tumblr! See us on Pinterest

 
 

Click to watch SMX conference video

Join us at one of our SMX or MarTech events:

United States

Europe

Australia & China

Learn more about: SMX | MarTech


Free Daily Marketing News!

Marketing Day is a once-per-day newsletter update - sign up below and get the news delivered to you!