Facebook launch Shops 'a new online shopping experience'

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Facebook launch Shops 'a new online shopping experience'

The quick version – 1 minute read

  • Facebook have launched Facebook Shops; an evolution of the existing Page Shops
  • Shops is native ecommerce within Facebook, Instagram, Whatsapp and Messenger
  • It is being rolled out gradually this year and not currently available to all retailers
  • You will need to consider investing in the following areas of expertise to capitalise on this market opportunity: Analytics, UX, Creative, CRO and Media
  • Talk to your Client Partner or one of our team to learn more

The detailed version – 3 minute read

In May, Mark Zuckerburg announced the launch of Facebook Shops; a native ecommerce experience within Facebook, Instagram, Whatsapp and Messenger. The rollout will be a considerable evolution of the existing Instagram and Facebook Page Shops, that facilitates product catalogues on both platforms.

Facebook Shops will enable brands to create customisable, digital storefronts on Instagram and Facebook that allow for seamless product discovery and shopping on the platform. These customisable storefronts will better represent the look and feel of a brand’s website, rather than the uniform product feeds in the existing Page Shops.

The only cost for Shops is an estimated processing fee of 5% on each purchase through native in-app checkout, as Facebook will continue to profit through advertising. The expectation being that dwell time and consumer engagement on their platforms will increase as there is less of a requirement to leave the app.

It’s important to note that Facebook Shops is being gradually released and isn’t currently available to all retailers. In addition, the in-app Checkout function is still a US beta, so transactions will continue to take place on retailer’s websites.

Why ecommerce brands should pay attention

Facebook has a global audience of 2.6bn users and this announcement is a big step towards the panacea of one-click-buy shopping on the social network, where Amazon has been relatively unchallenged.

Facebook Shops is another step away from the D2C retail website being a brand’s no.1 commerce destination. The global pandemic has further highlighted the need to be agile, have regular communication with customers and facilitate transactions in one platform. Recent months have seen online UK retail sales – as a percentage of total UK retail – increase by 33% (ONS, Jan 20 vs Apr 20).

There is a clear financial motivation for a slick shopping experience within the platform. A 2019 eMarketer study into cart abandonment statistics projected that the opportunity cost of friction in the US is $213 bn per year. Furthermore a 2018 US study found that 61% of US digital shoppers abandoned a cart because the site had errors. A trend we see only too often.

Once brands can take full advantage of the end-to-end Shops offering, they should expect higher conversion rates due to a more consistent, seamless experience on the platform between retailers. Users will quickly acclimatise to the process. The quality of the Pixel data – and additional signals – will also pave the way for even more intelligent advertising campaigns on the platform.

Brands that have dedicated efforts to building an engaged, social audience base are in a far stronger position than those that have paid less attention to the platform that currently makes up 4 of the 10 most downloaded apps in the UK (Jun 20).

What you can do now

Only once Facebook confirms via email that your Page Shop can be converted to a Facebook Shop, will you be able to create collections in Commerce Manager or partners such as Shopify, BigCommerce or Feedonomics. There is plenty of work to do in the meantime to make sure you’re not left behind when Shops is fully launched.

Facebook anticipates higher conversion rates, so you’d expect advertisers will be prepared to pay more for an impression. With that expected CPM increase, all ecommerce retailers should be setting aside larger social budgets, in anticipation that acquisition rates also improve over time.

To launch successfully on Facebook Shops you would need to invest in the following skills with us:

  • Analytics
  • UX / Design
  • Creative
  • Conversion Rate Optimisation
  • Paid Media

Please speak to your Client Partner or contact us in person to define this further.

Find out more from Facebook here.

And remember – your website still matters. With Page Shops already in play, and Facebook Shops being teased out, users will increasingly expect a more seamless experience once they land on a retailer’s website from Instagram or Facebook. Now is the perfect opportunity to invest in your existing digital shopfront – your website.