$500K funding for Berlin-based f-commerce startup Ondango
3Investors may be shunning Facebook right now as it searches for a viable business model, but investment in the Facebook ecosystem is still healthy.
Berlin-based f-commerce startup Ondango has just received a further $500K (taking total investment to $700K) funding led by the new VC Connect Ventures in London. Ondango makes it easy for businesses (core target is fashion, sport, design and music brands) to set up shop in Facebook, and it makes it easier for fans to buy from them – with no messing around authorising/accepting/installing Facebook apps. Ask a user to accept/install a Facebook app – and you get a dropout rate of 80% according to Ondango.
The hosted Ondango stores allow business to offer fan discounts, daily deals, and complete transactions on their Facebook Page within a Facebook-themed interface for €9.99 ($13)/month. He says that the company is starting to see some trends emerging among its customers. Co-founder Jose Matias del Pino says average conversion rate is 1.3%, average order value is $35 ($45), with impulse buys selling most successfully.
Is there any evidence to suggest that Facebook is a trusted environment for transactions? There’s plenty to suggest that it *isn’t*, of course (c.f. http://blog.magicbeanlab.com/opinion/people-dont-trust-facebook-why-build-banks-there/)
I see e-commerce players using Facebook to great effect; but it strikes me that they’re using it as a traffic driver to their own platforms; or better still, embedding the Graph API into their platform so that their customers become their advertisers. Surely that’s the way forward? Surely FB Store Fronts died last year? (http://blog.magicbeanlab.com/opinion/the-death-of-the-facebook-store-front/)
Apologies for all the links. I’m just trying to make a point in as short a space as possible!
Interesting. Any insight on how many paid users they might have?
I think this is an interesting idea, but a brand doesn’t have to go the whole hog and set-up a store front on FB. Consumers (Followers) want exclusive content and offers from those they give their allegiance to, but I think the jury is still out as to whether the FB page is ever to become their destination shop. Stimulating and rewarding consumer loyalty can be done easily via the HitMeUp platform. Offers can be posted and transacted within the FB page of the brand without the need to go off-line and break the social contact. The real-time nature allows flash sales and reaction to environmental conditions.