Facebook, Instagram push further into e-commerce with launch of online shops – CNET


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Facebook and Instagram are releasing new tools so businesses can sell their products online.

Angela Lang/CNET

Facebook said Tuesday that users will be able to shop without leaving the social network by visiting a business’ Facebook page or Instagram profile, a move that comes as more people turn to e-commerce because of the coronavirus pandemic. 

In the future, users will also be able to shop through the company’s messaging services, including Messenger, WhatsApp and Instagram Direct, the company said.

Taking on tech giants like Amazon, Facebook is making a stronger e-commerce push with the release of a tool called Shops. These online shops could also get users to spend more time on the world’s largest social network. Helping small businesses benefits Facebook because the company makes money through ad dollars. The move shows how Facebook is integrating e-commerce across all the apps it owns. 

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Facebook already offers various ways for businesses to sell their products through ads or on their pages. The social network has a feature called Marketplace that allows users to buy and sell new and used goods. Instagram, owned by Facebook, has a tool called Checkout that lets you buy items featured in a post. With Facebook Shops, though, businesses will be able to create one shop that appears across apps that Facebook owns, making it easier to manage potential sales. Businesses can also customize how their online shop looks by changing a cover image and different colors. Users can message a business through WhatsApp, Instagram Direct or Messenger to ask questions or track their order. Users will also be able to find a shop through an ad or stories, a feature that lets users post photos and images that vanish in 24 hours.

Facebook CEO Mark Zuckerberg said in a live video that the pandemic isn’t just a health emergency but “the biggest economic shock” that people have felt in their lifetime.

“As people are being told to stay home, small businesses are having a hard time staying open and millions of people are losing their jobs and this creates a deeper crisis for our communities,” he said. “The economic devastation of this may be even greater than the health impact of the virus and I think we’re going to be feeling this for years to come,” he added.

Setting up an online shop isn’t going to make up for all of the loss in sales, but it could help, Zuckerberg said. He called Facebook Shops “the biggest step” the social network has taken to enable commerce across its family of apps. 

The social network, though, could face challenges as it tries to get people to shop on the social network. Users could be hesitant about providing more data to a social network that has been plagued by numerous privacy scandals. Facebook said in a blog post that the company will share aggregated data with the business about its shop performance and traffic, but it won’t share personally identifiable information such as a user’s name or email address unless given permission to do so. The social network will also gather a user’s Facebook Shops activity “to personalize your experience on our apps and show you more relevant content, including ads.”

In an interview with CBS Evening News, Zuckerberg said the company isn’t going to tell anyone about a user’s buying or shopping history without a user’s permission. “That’s not really a big part of this experience,” he said. “This is really more about people being able to connect with the small businesses that they care about.”

Some businesses have also been wary about relying too much on the social network for online sales. Retailers such as Nordstrom and Macy’s, for example, have a “Shop Now” option on their Facebook pages but it takes users to the businesses’ websites and off the social network. About 160 million businesses around the world use Facebook, Instagram, WhatsApp or Messenger. Creating a Facebook Shop is free and the online store loads quickly on the social network, the company said.

Users who visit a Facebook Shop can either purchase from a business on their website or directly on Facebook or Instagram if the business has enabled Facebook Pay or its Checkout tool.

Facebook’s strategy is to build a “strong open ecosystem” of business tools, Zuckerberg said. “Ultimately, it’s going to be up to businesses to decide what they want to use and what level of integration they want,” he said.

Facebook said that it’s rolling out its Shops feature today and it will be more widely available in the coming months. The company is starting with a global test of almost 1 million businesses before a broader release. In the summer, starting in the US, Instagram Shops will let users buy products on Instagram Explore, a page that displays posts from users that you don’t follow yet based on your past likes and interests. The photo app is adding a shop tab in the navigation bar later this year. Sellers will also be able to tag products from their Facebook Shops before they stream a live video and these items will show up at the bottom of their broadcast. 

Facebook said it’s also testing a way for users to see and keep track of rewards they earn from businesses for their purchases. 

Outside of releasing new tools for businesses, Facebook is also offering $100 million in cash grants and ad credits for up to 30,000 eligible small businesses in more than 30 countries.

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