Facebook Expands its Marketplace for Car Shoppers

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Facebook launched an upgrade to its marketplace section this week that improves car shopping by adding more search options and bringing more content to the section.

eBay and Craigslist both already do a good job for car shoppers, but Facebook may be able to make a real dent in this industry segment.

With an estimated 217+ million active users in the U.S., the site has a significant advantage to grab the attention of car shoppers. And there have been reported competitive pressures on eBay Motors, more on that later.

To expand car listings to Facebook’s marketplace, the company is partnering with industry leaders in the pre-owned automotive and car dealer industry.

  • Edmunds
  • Cars.com
  • Auction123
  • CDK Global
  • SOCIALDEALER

The new section will also provide car values from trusted vehicle valuation and automotive research company Kelly Blue Book.

Image: Facebook

In a newly expanded role for Facebook’s Messenger platform, shoppers can communicate directly with dealerships. This new integration ties into dealership chat platforms ActivEngage, CarCode, Contact At Once!, and Gubagoo.

And finally, shopping for cars on Facebook finally introduces industry standard filtering of year, make, model, mileage, vehicle type, and transmission.

A new Vehicles Badge should show up on the latest update to the Facebook app. This badge is part of the top menu in the Marketplace section.

So parts of this new feature are live now. The company stated all of the integrations should roll out over the next few weeks.

Another Threat Looming for eBay Motors?

Forbes reported last year that eBay Motors sales had fallen off due to new startup entering the market.

eBay’s car and automotive parts business has always been a strong category and revenue segment for eBay. In the late 2000s, the company put a lot of effort in making it more user-friendly, allow for better placement options, and improve search dramatically.

But new startups have put pressure on eBay Motors, and according to Forbes, revenue on eBay motors dropped by 30% over the last five years.

eBay claims it still has the most automotive traffic with over 12 million visitors to its site (stating a 2015 metric from web traffic analysis firm comScore).

While eBay Motors did not get much front and center publicity at eBay Open 2017 or in general when eBay executives talk about the “turn-around” of the company, this year has seen some significant improvements on eBay Motors.

Event the new image search function works in eBay Motors!

All of these improvements by eBay are good news for sellers in the eBay Motors categories.

Facebook Has a Big Stick

Image: Facebook

But with Facebook entering this segment, this may now be the most significant threat to pre-owned car sales on eBay. The U.S. user base on Facebook is larger than the global user base of eBay.

For long, many observers of Facebook have been wondering when the social media giant would finally wake up to bring more eCommerce features to the platform.

The car segment is a big ticket, top Dollar segment and it appears Facebook decided to make the first significant eCommerce stand here.

While they have experimented with improving other Marketplace segments such as jobs, the inclusion of automotive industry leading vendors and bringing dealerships to the platform is a direct threat to eBay Motors and others.

How Facebook plans to monetize this is a bit unclear from their announcement.

There is no apparent inclusion of a fee structure (more of a possible immediate threat to eBay which charges a fee), but that could be managed through the backend with one of the announced partners. The partners could deploy a “sales channel fee” to dealers in which Facebook receives a piece of the revenue.

Image: CarFax

One glaring service absent from the Marketplace announcement is CarFax or a similar vehicle history search firm.

For dealership or partner based listings, that is part of that sales process as most of them already offer such as service to their customers.

But if Facebook wants more user to user listings for pre-owned cars, then a CarFax integration would be a great benefit to shoppers. But that may require a pay to list scheme.

This expansion is by far the most noteworthy development by Facebook entering the eCommerce space. It’s a bit ironic it comes after Facebook partnered with eBay to bring eBay daily deals to its Marketplace.

We’ll keep watching for more Facebook eCommerce news as it looks like there is finally a strategy.

What do you think about Facebook getting into the pre-owned car listings or expanding its eCommerce chops? We would like to hear your thoughts in the comments section below.

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