Facebook and Instagram announce the launch of Shops

Image of Facebook and Instagram shops

What is Shops?

Yesterday (19th March 2020) Facebook and Instagram announced the launch of Shops. The new initiative will allow you to browse and buy products from a Facebook Page or Instagram profile. Shops will allow businesses to set-up product listings on their Facebook page or Instagram profiles, stories or ads and they will be able to tag products during Facebook and Instagram live streams.

Covid-19 has affected 1000’s of small businesses across the UK. As a result, many have turned to Facebook and Instagram to help sell their products or services. Both platforms have been essential in helping businesses to communicate with their customers and continue trading.

CEO Mark Zuckerberg described Shops as “one simple and consistent experience across this family of apps”. He is hopeful that this will mean “higher conversions and more sales for small businesses”. Small businesses make up a large proportion of the 8 million advertisers on Facebook and Instagram. Due to this Facebook has vowed to support them in any way they can during the current pandemic, with Shops being a direct product of this.

Facebook’s vice president of ads Dan Levy has said that the company will charge “small fees” on each sale that is made. But, where Facebook will make the real money is from the increase in advertising as Shops can be featured in paid ads and stories. 

Should I start using Shops?

This is where small businesses will need to do their own investigating before launching on to Shops. Testing will be essential to ensure that the “small fees” are compensated by an uplift in sales. Many businesses are already generating strong sales organically and by using traditional ad formats, so the extra fees will need to be worthwhile. Another consideration is that in most cases users will have to leave the platform to checkout. Shops will make it easier for companies to list their products on their page and profile. But, the user leaving the platform adds another step into the journey and increases the risk of the user abandoning the basket. On the flip side, at least once the user reaches your site you are able to control the customer experience.

Only businesses participating in Facebook’s Checkout program will be able to make the purchase on the platform. This beta is currently only available in the US and is invite-only in the UK. Using Facebook Checkout also incurs a fee for each product sold, but as it is still in beta, Facebook is not currently disclosing the amount. This potentially could lead to multiple charges per product sold. Facebook has said they are working closely with Shopify (which also charge up to 2.9% per online transaction) and BigCommerce on how they can further support small businesses together.

Message from Facebook regarding beta not available

Summary

Facebook is working hard to create new initiatives to support small businesses as they have a vested interest in doing so. It is important to look at all the options available for your business to ensure your customers have the best possible experience.

If you would like to learn more about Shops and want to find out if it’s right for your business, please get in touch! We are experts in eCommerce having worked with many retailers in the UK and can make sure you get all the right information.

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