Now Trending in Influencer Marketing: Facebook Pay

November 19, 2019: Facebook launches Facebook Pay and personalized ad offerings; Influencers want to partner with cause-based brands; TikTok tests in-app shopping; Ohi empowers brands to compete with Amazon

Here’s what’s worth knowing this week:

Table of Contents

Facebook Pay Is Here for the Holidays

The Story

Facebook has launched a new payments system designed to facilitate transactions seamlessly across Facebook’s fam of social networks and apps.

Tell me more.

The payment system, aptly named Facebook Pay, allows users to send money to friends, donate to fundraisers, purchase event tickets/in-game items, and shop from brands that sell on Facebook Marketplace. To process these payments, Facebook is using Stripe and PayPal, among others. While this initial roll-out of Facebook Pay is limited to Messenger and Facebook, it will eventually expand to Instagram and WhatsApp as well.

STC POV

The launch of Facebook Pay comes on the heels of several payment companies dropping out of Libra, Facebook’s cryptocurrency project. Interestingly, PayPal was one of the first companies to drop out of Facebook’s Libra project, and is now supporting Facebook Pay, lending some much-needed legitimacy and social cred to the new system.

Facebook Pay brings us one step closer to a literal “social capital as currency” reality. With Facebook Pay, the foundation is laid for creator monetization across all of Facebook’s family of apps.

On the one hand, Facebook Pay may give creators the ability to expand subscription-like features for their content beyond Facebook, such as pay-per-programming or membership models for Instagram and/or exclusive creator support (similar to Patreon). This may also lay the groundwork for the ability to easily pay creators ad revenue in a way that could put Facebook in direct competition with YouTube.

As we continue to see creators build their own brands, Facebook Pay could grant creators the ability to seamlessly sell products and receive revenue in-app (particularly on Instagram where users are already going to discover these brands), which would be huge for ITC brand development, as well as a wider base of DTC and SMB brands.

Not Unrelated: Facebook Leans Into Ad Personalization

The Story

Facebook is leveraging its machine learning capabilities to bring personalization into its ads platform.

How so?

Dynamic formats and ad creative for Dynamic Ads: Advertisers can serve a personalized version of an ad to everyone who sees it, based on the formats that they have proven most likely to engage with, like a collection or a carousel.

Multiple text optimization in single-media ads: Advertisers can input multiple text options for the primary text, headline, and descriptive fields when building single-media ads.

Auto-translated languages for single-media ads: Advertisers can now add different languages to be auto-translated for international audiences.

I heard ad buyers aren’t thrilled…

You heard right. Just in time for Black Friday, ad buyers on Facebook have reported receiving countless error messages while setting up campaigns and delayed approval times for ads. The result? Lower returns on ad spend, some as much as 1.5x below average. Sound familiar? That’s because it is: last year, the platform was broken the Tuesday before Thanksgiving for nearly 16 hours.

STC POV

Are Facebook’s new, personalized ad capabilities enough to appease ad buyers’ woes? With Facebook’s personalized ads experiences, it is theoretically introducing the best of its customer experience + its targeting and machine learning capes + high-quality content/creative that resonates most.

In other words, this allows advertisers to more efficiently deliver campaigns that reach their target audiences, opening up all sorts of possibilities for testing, promoting, and optimizing influencer-generated content as paid ads and in brand-owned ad units. Of course, this is all dependent on Facebook’s ability to fix the current issues with the ads platform…

Now Trending: Influencers Want to Partner with Cause-Based Brands

The Story

The majority of influencers are more likely to collaborate with cause-based brands.

I’m listening…

We did some research with Adweek (#shamelessplug). In addition to the majority of influencers wanting to work with a cause-based brand, 23 percent of influencers also want to give back as part of the campaign. Other factors for engaging include an authentic fit with the brand and if the brand has an ongoing commitment to supporting the cause. Some of the most important causes to influencers include the environment, marginalized communities, and animals.

STC POV

With 2020 just around the corner, cause-based brands have an opportunity to engage in deeper collaboration with their Corporate Social Responsibility (CSR) teams. In doing so, brands can better activate influencers especially knowing that the majority of influencers want to collaborate with these brands.

When selecting influencers to work with, it’s important to choose influencers who are passionate about high-priority causes. From there, choosing those that are great visual storytellers will create a combination that’s truly impactful and authentic. Cause-based influencer marketing requires that marketers be intentional and clear on the impact or statement they’re trying to make and determine the best influencer for that message. No one needs a Kendall Jenner/Pepsi-esque PR nightmare on their hands.

For more tips on how to recruit, activate, and incentivize influencers for these types of programs, check out our blog post.

TikTok Tests In-App Shopping

The Story:

TikTok is testing shoppable videos as it tries to distance itself from its Chinese ownership.

Can I buy stuff on TikTok now?

Not unless you happen to be one of the few lucky influencers in the U.S. Influencers who are part of this beta test will be able to make their merch or sponsored products available within the app, enabling their followers to make in-app purchases. This sets the foundation for creators to monetize their influence and expand their brands beyond content, which may be novel for some TikTok-first influencers.

And the “rebranding?”

Due to concerns of privacy and the reputation of China in the U.S., there have been reports of TikTok discussing how to distance itself from its Chinese parent company, Bytedance. Given this and its testing of shoppable ads, executives seem concerned about whether consumers and marketers will trust their card information and purchase data to a platform of Chinese ownership. Additionally, TikTok doesn’t primarily operate out of China. As one Bytedance employee put it: “We are a Chinese company, and we do business overseas.” A potential rebrand could be an attempt at making the company as attractive as possible for an IPO at the end of next year.

STC POV

The evolution of social commerce continues. As TikTok begins testing shoppable videos and the ability to purchase in-app, there have been comparisons to Instagram’s in-app checkout and various other shopping features. However, Instagram’s shoppable features were designed to better facilitate brand-to-influencer shop-ability, whereas TikTok’s feature puts creators at the forefront, empowering them to use the app as a stream of revenue via their own creative merchandise.

As social platforms and in-app commerce continue to converge, consumer expectations about when and how they can buy may start to shift. Will people visit a brand’s TikTok or Instagram page instead of the brand’s website? Additionally, as the feature expands to be available to more users, it will be interesting to see who gets access to product tagging. Will only brands have this ability or will influencers have this ability, as well?

It’s also worth considering whether brands will even trust uploading their product catalogs and sharing consumer purchase data with a Chinese-owned application, all of which could act as barriers to entry for many brands, as well as significant hurdles for TikTok.

New Challenger: Ohi Raises $2.75MM to Compete with Amazon

The Story

Ohi, a startup focused on the democratization of same-day shipping options, has raised millions in a bid to help brands compete with Amazon.

What’s Ohi?

Ohi enables same-day fulfillment of products from smaller brands giving them a chance to compete with bigger brands like Amazon. Its mission is to democratize that offering by making it accessible to smaller brands.

How does it work?

Ohi partners with landlords to turn commercial retail properties into micro-warehouses within major cities. Then, the company offers those warehouses on flexible leases (as short as three months), which can help DTC brands distribute their products and provide same- or next-day delivery to their customers. Ohi charges brands a fixed monthly fee to access the platform, starting at $750/month. Brands also have the opportunity to pay more for premium intelligence features around matching inventory to warehouse locations and access to more spaces. Currently, Ohi operates in Manhattan and Brooklyn and has plans to open in LA in the coming months.

One last question, how do you pronounce Ohi?

Your guess is as good as ours.

STC POV

First, kudos to Ohi CEO Ben Jones for finally figuring out what to do with all the malls.

If they can manage to figure out how to scale successfully, this development has massive implications for both influencer and DTC brands that will now be able to compete with Amazon’s offerings. According to Ohi, brands are seeing a dramatic decrease in cart abandonment when customers see that same-day or next-day delivery option.

It will also be interesting to see how more established brands will play a role in this type of business. While Ohi wasn’t created to serve those brands specifically, as these larger brands buy up independents to stay relevant (peep Coty buying a majority stake in Kylie Cosmetics) and abandon Amazon entirely, we could see larger brands leverage opportunities like Ohi as they try to compete, as well.