Brian Lee and Mike Jones launch TopFloor with $6M in financing to deliver true in-stream social commerce
While social media has allowed brands to amass astronomical audiences, for the most part the medium has fallen short on driving direct commerce. No one knows this better than former MySpace CEO and current Science Media co-founder Mike Jones, and ecommerce uber-entrepreneur Brian Lee. The pair of Los Angeles titans have joined forces in launching TopFloor, an integrated, video-based commerce channel that lives within popular social platforms Facebook, Twitter, and YouTube.
The stealthy six-month-old startup is launching today out of Science with “more than $6 million” in financing from Google Ventures, Polaris Ventures, Crosslink Ventures, and Rustic Canyon Partners, as well as Science itself. Despite Jones and Lee’s instrumental early involvement, the pair have installed former MySpace head of international operations Rebekah Horne as its CEO, themselves stepping back into board member and advisory roles.
“To date, experiments [in connecting social and commerce] typically haven’t fared well because most have been little more than traditional ecommerce tactics shoehorned into social platforms.” Jones and Lee write in a blog post today. “Affiliate links and Web stores built in Facebook application tabs are just two examples. That’s about to change.”
Rather than offering a one-size-fits-all solution, TopFloor leverages the native interactions of each social platform. For example, the service uses YouTube’s existing annotations to add commerce hyperlinks into videos. On Twitter, the company uses the platform’s native, rich media cards to insert videos directly within the social stream, with the same annotations.
Clicking on one of these purchase links puts the product directly into a user’s TopFloor cart, ready for checkout. The cart appears as a light-boxed pop-out within the native social platform. The first go round, users will have to create a profile including uploading credit card info, but this info can be stored securely to simplify future checkouts. The young startup is still figuring out its monetization strategy, but thus far and for the immediate future the model is to take a revenue share on every completed transaction.
The hypothesis behind TopFloor is that offers get higher conversion when done within social experience. It’s a theory espoused by all the major social networks, but one which they have largely failed to release products to capitalize on. TopFloor is currently the closest thing on the market to one-click social purchase technology.
Beyond engaging video and a frictionless transaction process, the company is dabbling with other features that will make this more compelling and sticky, including implementing appointment-based sales and offering rewards for social sharing.
The company will initially target its content and product offerings toward what it calls the core social audience, meaning predominantly women seeking fashion accessories, gifts, items for kids. At launch, TopFloor will have several brands on board across these categories, although it has not yet revealed which.
What separates TopFloor from other ecommerce platforms, is its promise to turn existing social audiences into a commerce channel, rather than directing them to a standalone shopping destination. TopFloor has been tested quietly for several months and the company claims it’s been achieving 10 times the conversion for its Facebooks sales than standard email marketing campaigns.
More specifically, the company claims conversion rates of nearly 8 percent -- which seems shockingly high -- compared to traditional social shopping metrics of less than 1 percent. In one such test sale, TopFloor reportely moved 1,300 units of a $20 product in under three hours, according to its CEO. Although claims such as these are difficult to verify and contextualize, if sustainable they point to a tremendous vehicle to engage and monetize existing social audiences.
Brands have spent the last several years collecting Facebook, Twitter, and YouTube followers with little clear path toward capitalizing on this digital following. The social platforms themselves have long promised forthcoming solutions, but -- handicapped by the need to balance monetization with user experience -- they have moved slowly.
It’s not surprising, then, that a young startup with social and ecommerce DNA is pushing the boundaries in this space. That it’s coming out of Los Angeles, a tech market known for its focus on revenue, is equally apropos.
TopFloor is in its early days, something Jones, Lee, and Horne readily admit, calling today’s launch product version one. Expect the company to continue collecting feedback from both brands and consumers, while pushing the boundaries of what’s possible in frictionless social commerce.