Live for a while in Thailand, Facebook Marketplace has finally landed in Singapore, the home turf of Carousell.
Nobody seems to have reliable statistics, but we often hear practitioners saying that more than half of C2C commerce in Vietnam, the Philippines, Thailand & Indonesia happen on social media platforms.
It just seems natural that Facebook wants to capture this market.
On Facebook’s web site, the Marketplace is already available in 18 countries – guess they have not had the time to add “Singapore” to the list yet.
“Marketplace is available to most people 18 and older in Argentina, Australia, Austria, Belgium, Belize, Bulgaria, Canada, Chile, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Dominican Republic, Finland, France, Germany, Greece, Hungary, India, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Mexico, Netherlands, New Zealand, Norway, Poland, Panama, Paraguay, Portugal, Puerto Rico, Romania, Slovenia, Spain, Sweden, Switzerland, Thailand, United Kingdom, United States and Uruguay. You can use Marketplace on iPhone 5 or later, Android and iPad with the Facebook app or on your desktop at www.facebook.com/marketplace.”
Facebook might not succeed?
Of course Carousell can claim that Facebook is a big social platform and that they will not be able to execute eCommerce properly. A few news reports mentioned Facebook’s first (and failed) attempt to launch a marketplace back in 2007.
And after all Tencent, China’s biggest social platform, made multiple attempts at ecommerce, with limited success.
Anyone familiar with the financial market would remember this line “past performance is no guarantee of future results”. Many factors led to the failure of Facebook Marketplace 1.0 – we would argue timing being one, as smartphones were barely emerging back in 2007.
Even Tencent is making good progress through its decentralised WeChat platform and its massive advantage of consumer traffic, drawing a lot of attention from sellers previously concentrated on Alibaba’s Taobao platform.
Dismissing Facebook is pure denial. Responding correctly to the threat is what is needed.
The challenge for Carousell is that it is only relevant in Singapore – a situation similar to what Ezbuy is facing. (Read our other articles on how Ezbuy failed to update it’s technology, relied too heavily on Taobao, and how they got “bullied” by Alibaba).
While Carousell is firmly topping the iOS charts in Singapore, it is nowhere near the top in other key countries, even in its stronghold of the App Store (which is behind Google Play in most Southeast Asian markets in terms of market share).
In addition, Carousell has been only C2C – a position Shopee copied at the very beginning but then quickly evolved into something much more omnipresent, and ambitious. We are quite sure that Shopee does not see Carousell as competition – not any more at least.
Carousell has tried hard to diversify into other categories to become a leader in classified – with a good product and user experience. Alas, in most countries in the region classified is a red ocean – and most of the sharks in this ocean are bleeding themselves.
What would Facebook do to Carousell?
Some of our colleagues argue that Facebook should acquire Carousell, to immediately gain a foothold in the (slightly more) organised C2C eCommerce space.
But if you were Facebook, which has the best user base and where most of social commerce is already taking place, would you be willing to acquire someone who is not as big, only in Singapore and probably very expensive? Not even to mention about all the integration efforts needed after such an acquisition.
Facebook’s acquisitions of Whatsapp and Instagram happened when Facebook itself did not have a comparable product, while the respective companies already became very big, if not yet dominant, in their sub-verticals.
We do not think the situation of Carousell is comparable.
Then again, we are not Facebook and we do not have the full view of their strategic decisions.
Singapore still loves Carousell
Not only because the country still sees it as the poster boy of successful home grown startups, but people genuinely love the product. Nobody seems to be able (or willing) to dislodge Carousell from the top position in the Shopping category of Singapore’s App Store.
So maybe it is not the end of the story at all – many great companies underwent very tough competitive situations and survived – therefore they became great companies.
Maybe Carousell can do the magic as well?
Thanks for reading The Low Down, insight and inside knowledge from the team at Momentum Works. If you’d like to get in touch with us about any issues discussed in our blog, please drop us an email at [email protected] and let us know how we can help.