Facebook launches Shops: Everything we know so far

In an attempt to bring more businesses online right now, Facebook is making a major push into e-commerce with the launch of Shops. Shops is a way for businesses to set up free storefronts on Facebook and Instagram. These will be powered by third-party services like Shopify, BigCommerce and Woo and the main agenda is to turn the social network into a top-tier shopping destination.

Facebook CEO Mark Zuckerberg said on a live stream today that ‘expanded e-commerce’ would be an important aspect to rebuilding the economy as we weather out the pandemic. “If you can’t physically open your store or restaurant, you can still take orders online and ship them to people,” he said.

“We’re seeing a lot of small businesses that never had online businesses get online for the first time,” Zuckerberg added.

So far, over the Covid-19 pandemic, while e-commerce companies have clocked record sales, the pandemic has been devastating for small small businesses. A third of them have reportedly stopped operating as per a survey conducted by Facebook and the Small Business Roundtable. And an additional 11% small businesses have said that they could fail in the next three months if the current situation continues.

At this point, online sales has been the only spot of hope for these businesses. Etsy’s revenues have doubled from what it was three years ago. And Facebook is betting on a similar model that will bring more local businesses online to help them endure and also create a big new business opportunity for Facebook while they are at it.

Shops are free to create on Facebook. But they will be creating a business opportunity for Facebook in terms of ads, payments and other services. Businesses will be able to buy ads for their Shops and when people will use Facebook’s checkout option, they will be charged a fee.

According to Zuckerberg, Shops will “improve on the standard web commerce experience by storing users’ payment credentials in a single place that they can then use on any Facebook or Instagram storefront”. There are currently more than 160 million small businesses using the company’s apps across Facebook, Instagram etc.

Shops can be found on the businesses’ Facebook pages and their Instagram profiles. They can also appear in stories or be promoted in ads. Items that businesses have made available for purchase will appear within the shop, and users can either save items or place an order. While some businesses will let users make direct purchases from the Facebook page itself, others might redirect you to their business website to complete the transaction.

For customer support, businesses can use Messenger, Instagram and WhatsApp. There are also eventual plans to let users browse store catalogs and make direct purchases from the chat window and there are also plans to enable shopping from live streams by allowing brands and creators to tag items from their catalogs so as they appear below live videos.

Facebook is also working to integrate loyalty programs with shops. “You’ll be able to easily see and keep track of your points and rewards. And we’re exploring ways to help small businesses create, manage and surface a loyalty program on Facebook Shops,” the company said in a blog post.

Shops will begin rolling out on Facebook today in the United States and are coming to Instagram sometime this summer. Instagram will showcase brands on its existing shop account, which already highlights items that you can buy. Later this year, there are plans to add a dedicated shopping tab to its navigation bar.