Facebook Shops: What Shops could spell for the future of social commerce
Okay, social commerce is already a serious business but Facebook’s announcement that it is launching Facebook Shops, supported by a string of other e-commerce features, means it just got seriously serious.
OMD questions how Facebook Shops could revolutionise and change the online retail space.
What is Facebook Shops?
Shops will give businesses the ability to display and sell products directly from Facebook apps in a significant step-up of its e-commerce services. Unlike its existing Marketplace, which offers peer to peer selling, Shops will allow businesses to set up free online stores accessible via Facebook and Instagram. People will be able to browse products, save them in a basket and place an order without leaving the App.
Facebook Shops will seek to bring many of their existing, and future, e-commerce solutions together as they look to develop a broader ecosystem across Instagram, Facebook and Whatsapp – perhaps something more akin to WeChat’s in-app commerce functionality.
Along with Shops, Facebook has announced an integrated messaging solution to allow shoppers to contact businesses directly and eventually make payments directly through chat. They will also be rolling out live shopping to enable purchasing in real-time, a new ‘shop’ button to the explore section of Instagram and the ability to connect loyalty programs to Facebook accounts.
As with most of its services, Shops will be free for businesses to use with Facebook, hoping to boost consumer engagement and connect the impact of advertising on the platform through the funnel. Ultimately, Facebook has long had the ambition to reduce reliance on third parties to prove the effectiveness of its activity and in-app commerce helps achieve this as well as capturing further purchasing and geographic data on their audience.
What does it mean for the e-commerce landscape?
It’s a move that will be seen by many as a clear challenge to Amazon, eBay and other online retailers and one that may add further pressure to bricks and mortar stores. However, it is unlikely to pose any significant threat to Amazon due to its warehouse and fulfilment capabilities.
Facebook has positioned Shops as a solution for small, independent retail stores reeling from the impact of the Covid-19 pandemic. In addition to retail, Zuckerberg’s response directly referenced restaurants which are likely to turn the heads of the major takeaway delivery such as Deliveroo or Uber Eats. In fact, given the difference in the Facebook Shops model to Amazon from a fulfilment perspective, it may well be that businesses with an established delivery model in place benefit most from these new services.
Unlike Amazon and other search-based e-commerce channels, Facebook Shops will be better suited to the product discovery space where it’s ecosystem can become a digital window-shopping experience for users to browse. In those more impulsive moments, a seamless purchasing experience is vital to capitalise on the immediate consumer intent.
What do Facebook Shops mean for businesses?
As Facebook Shops seeks to give small independent stores the ability to scale through the continued digitisation of local products and services, you can see its role in an omnichannel approach for businesses large and small. Through the greater access to geographic data or localisation of experiences, brands could begin to redefine the role of stores in the consumer experience.
Allowing sales through Facebook Shop may lead to the ‘digital shelf’ moving further from the immediate control of businesses. This is a decision that will need to be weighed against a potential upturn in sales. Whatever the possible negatives, there’s a huge amount to be said for a frictionless sales experience on a platform where most audiences already are. An opportunity brands will be wise to consider.
This move will bring social media and eCommerce closer together, however, it is important that brands don’t forget the ‘social’ in social commerce. This could have a significant impact on the approach required to product imagery, live video, and the tone taken in messaging apps be it bot-driven or human.
With shoppers already shifting online before the pandemic, social distancing measures have accelerated consumers switching to eCommerce. It is a switch that is likely to remain even as lockdown measures relax. If Facebook Shops can deliver a seamless purchase experience, it could be well placed to seriously capitalise on these changing consumer behaviours. Which begs the questions, is it time you got serious about social commerce too?
Sam Bird, managing partner, content and experiences development at OMD
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