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Facebook Launches Facebook Shops: Can It Topple Amazon?

Updated: May 26, 2023


Messages for a commerce manager on a Facebook page shop

There isn't a brand available that hasn't benefited from some form of social media marketing—even if they are a long way from realizing full social commerce capabilities.


But there's more to social media marketing than likes, retweets and a high Instagram profile following. In order to wield it successfully, it requires direct engagement with customers as well as recognizing the limitations of social media.


The reality is that social media is a highly subjective playing field, if not an outright contentious one where style can count for more than substance.


That's not the case with Amazon. And while it's not uncommon to see brands on Amazon use social media to boost search frequency, it's not Amazon's business to be a social network. Their business is simple: to be an online retail platform.


That is, unless social media learns to catch up with them.


Social Media, Connectivity and the Pandemic

Facebook offers social media dominance

It would only make sense that Facebook would have continued to develop new tools and solutions to meet the growing needs of users during the pandemic. After all, they're by far the largest social media platform with some 2.45 billion users worldwide reported in 2019. And in times of crisis, consumers need convenience just as much as they need social contact.


Particularly the convenience of shopping. In the US alone, eCommerce sales were estimated to be over $187 billion for the fourth quarter of 2019—just one month prior to the Coronavirus outbreak. But there's only 247 million monthly active users who reside in the US. The largest concentration of users are actually located in the Asia Pacific region.


A 2020 survey from IPSOS indicated that China saw an increase of eCommerce sales by approximately 50 percent during the first few weeks of the pandemic. In comparison, the US reported an increase of only 23 percent. So how is Facebook planning to address the shopping needs of global consumers?


Through their new Facebook Shops feature. In a press release, Mark Zuckerberg and company announced the launch of a new feature that would allow small businesses to set up and manage a single online storefront to manage and provide a native shopping experience for customers on both Facebook and Instagram.


It's a bold move, especially given that the Facebook business model faces no small share of scrutiny. It's one which could be potentially poised to make a dent in Amazon's business. But will it?


What Is Facebook Shops?

Reviewing products featured on a Facebook page

Facebook Shops allows businesses to choose featured products to display through a single online store front which users can access from either their own Facebook page, business page or through Facebook Ads.


Just like Amazon, both large and small businesses can customize the layout and look of their Facebook shop, complete with a cover image and curated content to create product collections which can help showcase their brand. Potential customers can browse featured collections and add products directly from a business's eCommerce store or through the Facebook Shops feature if they live in the US.


Users can also message a business directly, either through a Facebook Shop tab or through WhatsApp and Facebook Messenger, to ask questions, get support and track deliveries, with a future option to shop and make purchases during a live chat.


Facebook confirmed the feature has already been rolled out, with the introduction of a similar app called Instagram Shops.


“People have been using live video on our apps to showcase products for years,” the social media giant announced. “We're making it easier to shop for products in real time. Soon, sellers, brands and creators will be able to tag products from their Facebook Shop or catalog before going live and those products will be shown at the bottom of the video so people can easily tap to learn more and purchase.”


"Shops are going to be able to use our AI to create better more personalized experiences than you're going to have almost anywhere else," said Meta CEO Mark Zuckerberg during a Facebook Live appearance.

The Advantages and Disadvantages of Facebook Shops vs. Amazon

Main page security concerns on Facebook

There's just one small problem. Facebook Marketplace has already developed a similar mobile app for both a Facebook business page as well as personal accounts. And it hasn't seemed to be taking away too much business from Amazon so far.


That's not solely because Facebook Marketplace is frequently a forum for the local sale of both new and used products of fairly dubious quality. That's largely because of security weaknesses and threats which have been plaguing Facebook since 2016.


Right now more than ever, people are relying on social connectivity for basic human needs. They want reassurance of the safety and security of friends and family members. But they also want a personal connection to their favorite brands.


Platforms like Facebook and Instagram can allow that connectivity. And they've already leveraged powerful capabilities for marketing by providing a showcase for brands to build a narrative through curated content. The effect can be a much more personalized customer experience.


But it is not a sales-driven retail one.


Amazon's eCommerce platform has a distinct advantage over the potential of Facebook and Instagram: security. And that security has already been established by a 25 year history of providing safe and effective retail and sales channels.


While Facebook has been proven to be an effective marketing tool, it simply doesn't have that history of ensuring seamless online transactions.


Customers might be able to interact and connect with a brand or website through Facebook Shops. But can they provide the customer centric approach Amazon does through one-touch purchases, personalized product suggestions, featured items and free one-day shipping? More specifically, can they provide the necessary security and privacy to complete an online purchase?


Reassurance, Crisis and the Dilemma of Facebook
Can Facebook reduce friction in online shopping?

Amazon's reputation for secure purchasing has long been established. But Facebook is entering into eCommerce at a time in which their own privacy breaches are on the forefront of many customer's minds.


Consumers want reassurance as much as they want the convenience of online shopping. And during a time of crisis which has boosted online sales, that reassurance was fundamental to the customer experience as a whole.


But Facebook hasn't necessarily weathered that crisis with grace. Reports of misinformation on the network have run rampant for a very specific reason: it allows anyone a forum to express themselves, frequently without verification or accountability.


There's no reason why Amazon and Facebook Shops can't coexist harmoniously in the eCommerce world. And there's no reason why you can't leverage both to provide a multi-channel digital retail experience.


But security is critical for your brand. And the only security that's more critical is the health and well-being of your customers.

 

There's more to online brand growth than social media. Find out more at Color More Lines


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