digital disruptors | May 20, 2020 |
Facebook gets into the e-commerce game

With people doing more of their shopping online, it makes perfect sense that Facebook would pick this moment to unveil an extensive new e-commerce platform, simply titled Shops. Operating on both Facebook and Instagram, Shops will allow businesses to sell to users directly through both apps, with the integration rolling out on Facebook this week and coming to Instagram sometime this summer.

“If you’re running a small business, or you’re thinking of starting one—even from your living room—you now have a whole suite of tools available that can help you serve people,” Facebook founder Mark Zuckerberg said following the announcement of the new feature yesterday. “You can build out your online presence across Facebook and Instagram. You can use Messenger and WhatsApp to communicate with your customers. You can reach new customers through our ads. And now, you can also set up a full online store experience with Facebook Shops.”

The Shops platform will be separate from Facebook’s Marketplace, which is more akin to Craigslist than Etsy. To pull off a platform geared toward retailers, Facebook is partnering with a number of third-party services, including Shopify, BigCommerce and WooCommerce. In addition to transacting, Shops will also focus on discovery; there will soon be a shopping tab on Instagram, similar to the platform’s current “Explore” feature, which allows users to peruse items they might be interested in.

“Looking at the announcement, it sounds like an easier, faster—and let’s not forget cheaper—way for sellers to connect with buyers,” says retail expert and BOH columnist Warren Shoulberg. “Almost since Zuckerberg started working to monetize Facebook, he has been trying to find the right formula for e-commerce selling. This could be it.”

Zuckerberg also said that the company plans to integrate artificial intelligence and augmented reality technology into Shops in the near future. “We'll automatically identify and tag products in feeds so people can easily click through to purchase when they find things they like,” he said. “Small businesses will also be able to personalize their storefronts to first show products that are most relevant to you and use augmented reality to let you virtually try on things like sunglasses, lipstick or makeup to see how they might look on you before buying, or what furniture might look like in your room.”

Houston-based design business consultant Leslie Carothers, the co-founder and CEO of custom-publishing venture Savour Partnership, is cautiously optimistic about the new platform, though she urges designers to look at it as a tool to augment their existing business rather than as a replacement for running e-commerce through a site of their own. “It’s an intriguing new way for people to sell physical inventory, but the minute you make it your only source of selling, you’re giving up control of your business,” she says. “Facebook controls the algorithm and what consumers are seeing, and they can change that formula at any time, as they have in the past on other ventures.” Media outlets, for example, once depended heavily on Facebook for directing users to their stories; after a few years, Facebook deprioritized publisher-driven content and returned its focus to community-based sharing.

Carothers speculates that Shops could provide sellers with a broad reach initially, only to charge for different levels of exposure down the line—or that sellers might invest in shooting and styling product images to suit certain visual specifications, which could then be changed. “Facebook’s goal is to make it easy to stay on their site and on the applications that they own. They’re trying to put everything in one place, and now they’re letting users gather around product,” says Carothers. “No one has the infrastructure that Facebook does—not Amazon or Google, and certainly not Wayfair or Pinterest. And I think that’s why they’ll win at this game.”

Homepage photo: A preview of Instagram Shops | Courtesy of Facebook

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