Facebook targets eBay, Craigslist with Marketplace but falls way short

According to Facebook, more than 450 million of its members visit groups on its social network where individuals buy and sell goods, and now Facebook is looking to create a formal channel for commerce on its service.

Yesterday, it launched Facebook Marketplace, “a convenient destination to discover, buy and sell items with people in your community.”

Through Marketplace, sellers can post the details and photos of the items that they’re looking to sell, and buyers can search for items for sale near them or in a specific location. A search function is available, and there are a number of filters offered, including category and price.


At least initially, Facebook will not be directly involved in sales transactions. Instead, buyers and sellers can direct message each other to negotiate sales and agree on how they will be carried out.

Marketplace is initially available in the U.S., U.K., Australia and New Zealand to users 18 and older. Currently, Marketplace is available for individual users and not businesses.

A half-baked effort?

Not surprisingly, Marketplace has drawn comparisons to Craigslist and eBay, and the announcement apparently caused the price of eBay shares to slide. But is Marketplace really a threat to Craigslist and eBay?

Marketplace isn’t Facebook’s first attempt at creating a way for its users to buy and sell items. In 2007, it launched another product, also called Marketplace, that was transferred to a company called Oodle in 2009. That was pulled from Facebook’s app in 2014.

But it’s not evident that Facebook has built a substantially better offering with the newest Marketplace. Unlike eBay, the company doesn’t offer any buyer or seller protections, and because it isn’t involved in the sales transactions, the risk of fraud would appear to be higher. Like Craigslist, the hands-off nature of Marketplace could also leave users who aren’t careful vulnerable to dangerous physical situations.


Theoretically, Facebook’s social graph could help users make better decisions about who to transact with and how. For example, buying an item from a friend of a good friend probably doesn’t carry the same risk as buying an item from a complete stranger, but there are still no guarantees.

There is also the issue of how well Facebook will be able to police Marketplace. Already, listings for drugs, weapons, animals and illicit services can be found on the service, even though they violate Facebook’s commerce policy. There are also humorous listings, such as 6 ounces of water, bottle not included, offered for $56.

According to reports, Facebook says it has employees looking for listings that violate its rules, but it also appears to be relying heavily on the Facebook community to report these listings, which clearly isn’t going to be good enough.

So while Facebook’s massive userbase will always give it the opportunity to become a major ecommerce player, Marketplace seems to indicate that the company isn’t yet prepared to make a credible effort in this space.

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