Digital First: Facebook Kills Physical Goods Delivery in Gifting Service

book’s great gifting experiment has come to an end — for physical goods, at least.
After less than a year on the market, the company plans to ramp down its physical gifting service due to an overall lack of user demand. Instead, Facebook will shift its Gifts product entirely to digital goods and gift cards, a retail category for which the company saw much higher customer preference.
More than 80 percent of gifts sent on Facebook were digital, according to the company.
“We’re really making the decision based on user feedback,” said Lee Linden, Facebook’s head of the Gifts program, in an interview. “The physical stuff is interesting for sure, but our goal is to build stuff that’s really great for the majority of people who are using it.”
The switch is also likely due in part to the extremely complicated system that a physical goods delivery operation requires, including working with many partners to keep up with inventory tracking, fulfillment and delivery, and the incredibly touchy task of providing ample customer service. It is unclear how many people inside of Facebook were devoted to maintaining the physical goods Gifts program.
“Physical gifts do require more work to maintain,” Linden said. “And if less than 20 percent of users are taking advantage of it — the purpose of this redesign is to double down on what people want.”
The pivot to offering digital only certainly makes sense in terms of cutting overhead and complication (not to mention eliminating a physical goods business which likely saw razor-thin profit margins). Users will instead be directed to a gifts center with gift card options from businesses like Starbucks, Apple’s iTunes, Target and others.
Linden also stressed the importance of the Facebook Card — a re-loadable gift card that people can choose to pay with at a number of retail partners, though I’d posit this is somewhat more complicated than it should be. Users are directed to load money into individual retailer accounts on the card — like, say, $20 for Olive Garden and $20 for Target — instead of loading money into one account on the card and spending it wherever they choose. (This is likely due to retailers wanting the customer to be “locked in” to spending money with their establishment.)
The move to strictly digital will also put Facebook in more direct competition with services like Wrapp, a purely digital gifting startup that uses the Facebook platform. Linden said Wrapp continues to be “very welcome on the platform.”
The shift will roll out to 10 percent of users Friday afternoon, and completely turn over to 100 percent of the network beginning next week.

Google and Waze Start Mixing Their Maps for the First Time

oogle today is introducing the first integrations between its homegrown Google Maps for mobile and its newly owned Waze.

Google adds Waze

The traffic tab on Google Maps for iOS and Android will now include accidents, construction, road closures and other incidents reported by Waze users. Meanwhile, the Waze app now supports Google search, and Waze map editors will have access to Google Street View and satellite imagery.
Google grabbing Waze for more than $1 billion in June kept the hot startup away from other suitors, but also landed the “more wood behind fewer arrows” advocates in Mountain View, Calif. with two map apps.
Given the substantial overlap between Google Maps and Waze, it’s interesting to see what the company does to bring them together and keep them distinct.
Adding Waze incident reports is the obvious choice, but also a substantial one; Waze users report millions of blockages and accidents per month. “I think it will have a pretty big impact,” said Brian McClendon, VP of Google Maps. “A big fraction of GMM users will see these.”
As McClendon described it in an interview Monday, Waze will continue to be focused on two core things: its community, and helping people who commute.
As for Google Maps’ perceived strengths? Those are search, exploring, finding businesses around you, and offering more imagery, according to McClendon.

Waze adds Google

“We are cross-pollinating as much as possible,” McClendon said of his team and the Waze U.S. unit, which moved to Mountain View a couple weeks ago (the company’s engineering group remains in Tel Aviv). “We’re learning a lot both ways; it’s a very strong meeting of the minds.”
Though Google Maps won’t credit Waze users by name for their incident reports, it will offer them “a much larger audience listening in on that conversation,” McClendon said.
Given that Google has publicly disclosed that the Waze deal is being reviewed retroactively by the U.S. Federal Trade Commission, it’s interesting that McClendon is being quite so forward about these integrations, which he said were the first of many.
“Nothing has changed in our actions based on the FTC,” McClendon said.

Flickr/HeatherMG Brian McClendon, VP of Google Maps

Waze users will provide to Google incident reports from Argentina, Brazil, Chile, Colombia, Ecuador, France, Germany, Mexico, Panama, Peru, Switzerland, UK and the U.S.
Google Maps for Mobile will also continue to show traffic incidents from other providers including TomTom, McClendon noted.
Another potentially interesting area of overlap between Waze and Google Maps is monetization. Google (duh) has taken a search ads approach — it just added ads on Google Maps for iPhone and iPad, after having them on the Android version for a while. Waze has struck deals to display a smattering of businesses on its map (mainly Taco Bell, it seems) when users are approaching them.
“Waze has a materially different model,” McClendon noted. “But, it’s early days for local advertising and I think we both have good ideas, and right now lots of experiments.”
So will Google really maintain two map apps long-term?
“We would never do anything to hurt the community,” McClendon said, “And right now, having the Waze app is the way to stay focused on it.”
He added, “Long-term speculation, I probably wouldn’t get into, but right now they are two powerful separate applications.”