The first generation of stores inside Facebook have been total flops, Bloomberg reports.
This is a problem for Facebook because it's one less business it can "tax" to generate further revenue.
Gamestop, JC Penney, Nordstrom, and Gap have all opened and closed stores in Facebook in the last year.
The stores didn't lead to significant sales, and people quoted by Bloomberg seem to suggest that a company is better off having a good website for e-commerce than a store inside of Facebook.
Ashley Sheetz, the VP of marketing and strategy at Gamestop tells Bloomberg, "We just didn’t get the return on investment we needed from the Facebook market, so we shut it down pretty quickly ... For us, it’s been a way we communicate with customers on deals, not a place to sell."
Facebook is reportedly looking for a $100 billion valuation when it IPOs. But, its current business doesn't support that valuation. If you believe it's going to be worth $100 billion, and eventually much more, you have to believe it's going to make money from more than just ads.
The theory is that companies will come to depend on Facebook's huge user base, then Facebook will figure out how to "tax", or make money off those companies. Zynga, for instance, built a huge business, and then one day Facebook said, give us 30%. In theory, F-commerce, or Facebook Commerce was going to be another taxable business. It isn't.
Why is f-commerce a flop? Chris Dixon, CEO of Hunch, explains it pretty succinctly on Twitter: "Facebook is like Starbucks where everyone hangs out but no one ever buys anything."
Now, this is just the first attempt at commerce on Facebook. And it sounds like the big problem is that companies were just replicating what they had on their websites inside of Facebook. There's still a chance someone will figure out a way to make an e-commerce experience that works in Facebook by tailoring it to Facebook's strengths.
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