Facebook's New Retail Push Allows Users to Hit 'Buy'

On Monday, Facebook quietly started testing another feature that could help turn the company into an online retail powerhouse.


It is called "Collections" and will help retailers share their products on the social network — and for the first time allow users to click through and BUY products THROUGH Facebook . Of course we can expect Facebook to take a cut, though it hasn't yet.

The news follows COO Sheryl Sandberg's recent commentsabout the potential for retail on Facebook, as well as the test of a "Gifts" service, which allows users to buy real gifts instead of virtual goods. (Read More: Facebook Moves Into E-Commerce, Tests Facebook Gifts.)

The company is allowing seven retailers to share information about products through "Collections," which users can then share with their friends.

Facebook is testing three different options for users to take action when viewing the products — "like," "collect," and "want." Presumably the social media giant will go with whichever of these three draws the most traction.

Each of these three actions will show up on a user's Timeline for friends to see. This is a more sophisticated version of the way many brands already share products through photo albums. It’s also very similar to the way brands share products on Pinterest, and the way Pinterest users "pin" and share photos with friends. (Read More: Why Pine for the Pinterest Consumer? They're Worth More.)

The big difference here — Facebook is including a "buy" link for products within a collection, sending people to the sites to purchase products. Facebook isn’t charging for this service yet — but presumably it plans to take a cut of all sales that originate on its platform. And the more people share products, the more they’re likely to buy.


Facebook is starting the test with seven major retailers: William Sonoma's Pottery Barn, Neiman Marcus, Limited Brand's Victoria’s Secret, Fab.com, Michael Kors , Smith Optics, and Wayfair.

With this latest move, Facebook is hoping to push into the next frontier of social shopping and capitalize on the power of people sharing products they like with friends. It only seems natural for the company to roll out this service in time for the holiday shopping season. (Read More: It's Beginning to Look a Lot Like...Holiday Spending.)

It’s also worth noting that Facebook is starting to make money on a model Pinterest pioneered — allowing people to share photos they like. Pinterest hasn’t made a dime yet. It’ll be interesting to see if Facebook can monetize product sharing before Pinterest does.

—By CNBC's Julia Boorstin

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