Mark Zuckerberg founder and Chief Executive of Facebook on Tuesday announced that Facebook Inc. is launching shops, a service that will allow the businesses to display and sell their products on the world’s largest social media platform. He is positioning shops as a tool for small businesses, due to the coronavirus pandemic, many of the businesses have to close their doors and move to online business.
Currently Facebook allows sales through the marketplace which was launched in 2016 and it allows users to sell personal belongings to each other, much like craigslist.
The basic idea behind Face book shops is that it allows small businesses to build an online store and sell things directly across Facebook’s family of apps including Instagram and Facebook. And while every business, both big and small, can benefit from this, Facebook shops are especially valuable to small businesses.
It will also potentially pose a challenge to other commerce rivals such as Etsy and Amazon, which have profited from the increased online sales that have come with the COVID-19 lockdowns.
The move is to build up e-commerce offerings follows the Facebook launch last year of limited shopping options on photosharing app Instagram and messaging app Whatsapp. Company leaders wager making the platforms more business-friendly will generate fresh ad revenue, even as user growth slows.
Facebook shops will tie at least some of these efforts together, which enable businesses to set up a single online store accessible via Facebook and Instagram. A checkout feature will enable in-app purchases, while the deeply integrated messaging feature will allow you all to message a business through WhatsApp, Messenger, or Instagram direct to ask questions, get support, track deliveries, and more just like the physical stores. You will be able to view a business shop and make purchases right within a chat from Whatsapp, Messenger, or Instagram direct.
Facebook is partnering with Shopify, BigCommerce, Woo, Channel Advisor, Tienda Nube and Feedonomics to help brands bring their products into Facebook Shops.
Zuckerberg also said the world’s largest social network would be working more closely on product integrations with Shopify and even other online commerce platforms going forward. He had Shopify CEO Tobias Lütke join him in a live stream video announcing the partnerships.
Shopify’s shares sank after the initial Facebook Shops launch, then rebounded following Lütke’s appearance. Shares of both the company were up over 2 percent in afternoon US trade.
As with Facebook’s other e-commerce features shops are will be free for business to access with the expectation it will boost consumer engagement and ad sales.
Zuckerberg also said “our business model here is ads”. “Rather than charge business for shops, we know shops are valuable for businesses. They are going to in general bid more for ads and we’ll eventually make money that way.”
Facebook also plans to launch a new Live Shopping feature across Facebook and Instagram, which will allow shop in real-time.
According to Zuckerberg, more than 800 million people are engaged in live video daily across Facebook and Instagram, and a lot of that includes Product tutorials and launches -so already a strong e-commerce culture is attached to live video making purchase and sale easier.