The Fancy is being touted as the next Pinterest. Now having passed 1 million members, its becoming the “it” site. Add to that an all-star cast of investors and a defined business model based on commerce and you’ve got months of hype to come.
For the uninitiated, Fancy combines the transaction capabilities of a daily deal site, like Groupon, with the visual imagery and organization of Pinterest. LikePinterest, The Fancy lets users curate and organize images into list or boards. Unlike Pinterest, users can shop and with a click, buy the product at on a third-party site. It’s built with the intent of driving commerce.
The Fancy, like daily deal sites, pushes out a daily email of specials to members.
What’s cool about it is unlike other social media platforms -- Pinterest, Twitter, Facebook -- that first built a member/user base, Fancy is placing a bet on a defined revenue model out of the gate. And that bet is commerce, not advertising, at least not yet. As it is today, The Fancy will get 10% of each sale, paid for by merchants.
But what’s getting everyone’s attention is the bet it’s placing on the power of social networks on purchase decision. The “holy grail” for social sites is the ability to show a direct correlation between brand preference and buying that brand. The Fancy, because of the integration of commerce and an ability to track conversion, has the potential to link intent with purchase. If successful, Fancy will attract merchants (and eventually advertisers) quickly.
The concept is strong and there are lots of things to like. Bt there is causes for concern:
1. Daily deal sites are trending downward. The Fancy, unlike others, is trying to build a community around a business model. It’s a high-risk gamble because, as other have seen (LinkedIn and MySpace for example), business models often evolve based on users behaviors, which is often hard to predict. The other question -- is The Fancy entering a market that appears to be on a downward trend or could it be the next generation of daily deal sites?
2. The risk of false positives. It’s unclear how users will respond to unsolicited recommendations. The hope is that followers of users who had post products will self identify and make their intent known. The risk here is triggering “false positives,” in that, users my signal intent (“Fancy It”) without having any real motivation or desire to make a purchase decision. Yes, I want to buy the Ferrari you posted, but the reality is that’s not going to happen.
3. Is it too cool? One thing is certain about The Fancy: members curate eye-catching products (carbon fiber beach paddles by Channel, for example). But are the products being aggregated too cool for commerce? To scale the business will The Fancy have to aim lower to drive transaction volumes?
Still, the potential is definitely there. Consider the fact that Pinterest’s sales conversion rate is now three times that of Facebook (1.1% versus .35%.) But, it’s still a two-step process. You click on the image and then leave the site to purchase the product. With Fancy, you can transact directly from the site. This means conversion rates could explode, which will be attractive to both merchants and advertisers.
It will be interesting to see if The Fancy makes the leap from a good-looking site based off of a good idea to a great commerce engine. In the meantime, I’ll be purchasing cooler/patio table featured today for my next bbq.