Facebook struck launch gold with Threads, passing 100 million users in its first week by creating a frictionless sign-up via Instagram and keeping the product simple.
In doing so, Threads has - despite the predicted drop-off that has it averaging around 20 million daily active users - cemented itself as Meta’s first successful product launch since Facebook.
The surprise launch and stronger-than-expected user numbers of the “Twitter-killer” to be has invited pundits to take a trip down memory lane and recall all of the times Meta botched similar roll-outs: “Snapchat killer” Poke, “Gmail killer” Facebook E-Mail, “bitcoin killer” Libra, “FaceTime killer” Portal, “iPhone killer” Facebook phone, and so on and so forth.
But there’s one lesser-known failure that is rarely given a proper look despite being a natural product extension and clear multi-billion dollar opportunity: Facebook Gifts.
The Tale of Facebook Gifts
Facebook Gifts was announced at the end of 2012 in a company blog post: the social network allowed users to send gifts to friends, with special emphasis on the previously-almighty Facebook birthday, engagements, or other life achievements.
The gift-giver would select a gift, attach a digital card, and hit send. The recipient would see a “wrapped” gift on their wall, open it to reveal the gift and a personal message, enter their physical address, and receive the gift a few days later.
Facebook even offered the recipient the opportunity to modify colors, sizes, and flavors, or exchange the gift for something of equal value.
This may read like feature creep and a cheap attempt to jumpstart Meta’s struggling social e-commerce efforts in 2023, but it’s important to remember the context of 2012: when Facebook was a birthday juggernaut.
The Facebook birthday became so prevalent and part of the zeitgeist, multiple articles were penned by people who described being overwhelmed by the volume of birthday wishes. At its peak, an estimated 20% of one’s Facebook friends could be expected to post on your wall, resulting in an average of more than 100 notifications on one’s birthday.
Birthdays were such a high-traffic part of the Facebook experience that company product manager interviews once included the question, “How would you improve Facebook Birthdays?”
The improvement of choice became deeper engagement: Facebook Gifts was born. Analysts and reporters were bullish on the concept, sure Gifts would turn into a profit center worth hundreds of millions in revenue.
The Facebook Gifts marketplace launched with typical gift fare: chocolates, stuffed animals, and gift cards. If that doesn’t excite you, you’re not alone. So few people purchased physical gifts that Facebook pivoted the product to focus on digital gift cards.
The pivot kept the feature afloat, but Facebook made a few errors that kept it from ever truly taking off.
Facebook, which has never been shy about leveraging its interest graph and user data to drive advertising outcomes, prevented Facebook Gifts from doing the same. It seems like there are so many simple opportunities:
Facebook knows who my dad is, when it’s his birthday, that he likes golf, and (probably, at the time) a bunch of location data that would have enabled a meaningful offer from any major golf brand.
Targeted commerce transactions with clear attribution, like the one I just described, would be an easy sell for a direct-to-consumer brand or online re-seller, but Facebook’s sales org never got a crack at it as they instead chose to focus on mass appeal.
Even those who enjoyed the Facebook Gifts experience likely never got to use it for a second full cycle: if your mom enjoyed the Facebook Gift she received in 2013, you had to go find it elsewhere in 2014. Facebook’s convictions were so weak here, they shut it down after about a year.
The biggest miss isn’t the millions (or billions) of incremental revenue they should have earned in the past decade; it’s they didn’t take advantage of this window of opportunity to build a strong commerce arm that they so sorely need today.
Their current efforts to deliver commerce on social (primarily via Instagram) are still clunky, and they’re still struggling to onboard great partners.
Their failure to activate the next layer of birthdays on Facebook accelerated the drift into irrelevance for Facebook's Birthday. By my own experience (and confirmed by others), Facebook birthdays are down 90% from their peak a decade ago.
While a person might expect to receive more than 100 birthday messages on the platform in 2013, that number has shrunk to 6-12.
This is despite adding 1.6 billion new users since then - all of whom have birthdays.
To their credit, Facebook tried to keep birthday engagement alive. In 2013, they started notifying you when your friends had birthdays. In 2014, they started doing cards, and in 2015, prompted people to leave video birthday wishes.
The platform started creating celebratory videos from previously-uploaded content in 2016 and rolled out birthday charity fundraisers in 2017.
But this doesn’t seem like innovation or anything that leads to the kind of opportunity they fumbled with Gifts. It reads like desperation to re-capture that Facebook birthday magic, and trying a little too hard.
Coupling this trend with the rapid fragmentation of social media, with people retreating into their niche social networks and private group corners where they find more signal and less noise, it should be no surprise that Facebook features have also splintered off.
Startups like Birthday App use some special magic sauce to create a single-use app that brings birthdays back to the basics: ensuring that you don’t become that bad friend who misses your friend’s birthday.
Birthday App doesn’t push you to post publicly or over-complicate things, they just encourage simple engagement with your friend on their special day.
It’s not surprising the app is gaining traction, but it is interesting to see Gen Z talk about it on Tik Tok, especially given their general distaste for Facebook and lack of history with the Facebook birthday experience.
If recent history is any indication, it won’t be long before Facebook attempts to capture that Gen Z attention with a standalone Birthday app of their own - likely with a sign-on via Instagram.