Facebook and Instagram chase e-commerce with social storefronts called 'Shops'
Facebook wants businesses to open up on the social network and Instagram with a new a program that lets brands erect digital storefronts across its apps.
On Tuesday, the company announced Facebook Shops, which is a new way for businesses to showcase their products online. The social network sees an opportunity to work with millions of businesses on Facebook, Instagram, Messenger and WhatsApp, especially as shoppers are staying home and making more purchases online.
Shops is an evolution of the e-commerce bells and whistles that Facebook already had in place, but this one unifies the storefront across all the social network's properties. It enables better integration among businesses, their product catalogs and their online presentation. Facebook also developed new shopping features within Instagram and live video.
On Tuesday, Facebook rival Pinterest also announced a product called Shopping Spotlights, as both platforms fight for position with consumers who are discovering products and making purchases online. Both Instagram, owned by Facebook, and Pinterest are ripe for analyzing consumer trends, with the information being passed back to advertisers.
“This is the biggest step that we’ve taken yet to enable commerce across our family of apps,” said Dan Levy, VP of ads and business platform at Facebook, in a phone interview Monday.
Shops are run like online stores, similar to a brand’s page on Amazon, with product images and links for buying. The Shops are connected to the brands’ accounts on Facebook, Instagram and WhatsApp. Facebook says Shops opened immediately to nearly a million businesses on the platform.
Instagram also launched a new section called Instagram Shop, which will appear initially in the Discover tab, before becoming its own shopping destination within the app. Instagram Shop will offer a feed of products personalized for each user. On Tuesday, Facebook also announced that it would integrate shopping with live videos on Facebook and Instagram so that brands and creators can use livestreams to promote products available in their Shops.
“We want to be able to turn that live activity into a shopping behavior,” says Vishal Shah, VP of products at Instagram, in a phone interview on Monday. “We’re letting businesses and creators tag their products from their Facebook Shops and letting people buy them directly from the livestream.”
Facebook has made a number of product changes during the coronavirus lockdown. The company is rethinking older products like IGTV and standing up new ones like Messenger Rooms. (Last month, CEO Mark Zuckerberg unveiled Messenger Rooms, which enables social video chats and competes with Zoom. Zuckerberg also announced Shops in a similar live presentation on Tuesday.)
With e-commerce, Facebook says that it can help the 160 million businesses on the social network continue to operate, even during a global shutdown. This week, Facebook released a study that claimed one-third of small businesses have closed during the pandemic. Also, one-third of small businesses now sell all their goods online, Facebook’s report said.
Meanwhile, Pinterest is in a similar spot, looking for ways to serve those same small businesses and link them to new sales channels. In many ways, Facebook’s e-commerce changes mimic products that Pinterest has developed. For instance, Instagram Shop is similar to Pinterest Shop, which launched last month.
Both platforms are places where consumers run into products and can easily purchase them. Pinterest’s latest product, Spotlights, puts an editorial spin on shopping by partnering with trendsetters and style publishers like Elaine Welteroth, former editor-in-chief at Teen Vogue, who will share fashion and lifestyle product tips on Pinterest.
On Tuesday, Jon Kaplan, Pinterest’s chief revenue officer, appeared on Ad Age Remotely and discussed e-commerce. “Shopping has been an important part of our strategy for some time,” Kaplan said. “We see marketers in this environment wanting to move to more accountable outcomes, such as conversion and sales.”
“People want to find ideas and then they want to go buy those things on Pinterest,” Kaplan said.