Tech

Mark Zuckerberg announces Facebook Shops, making it easier for businesses to list products for sale

Key Points
  • Facebook CEO Mark Zuckerberg announced Facebook Shops, a new e-commerce feature that allows businesses to easily list their products on Facebook and Instagram. 
  • Using Facebook Shops allows businesses to list their products on their Facebook Page, Instagram profile, Stories or in ads.
  • In the future, Facebook Shops will also allow businesses to sell products to customers through the chat features of WhatsApp, Messenger and Instagram Direct and tag products during livestreams.
Facebook founder Mark Zuckerberg speaks at Georgetown University in a 'Conversation on Free Expression" in Washington, DC on October 17, 2019.
Andrew Caballero-Reynolds | AFP | Getty Images

CEO Mark Zuckerberg on Tuesday announced Facebook Shops, which will make it easier for companies to list their products on Facebook and Instagram. 

Facebook Shops, which is free, will let businesses set up product listings on their Facebook Page, Instagram profile, Stories or in ads, the company announced. In the future, Facebook Shops will also allow businesses to sell products to customers through the chat features of WhatsApp, Messenger and Instagram Direct. They'll also be able to tag products during Facebook and Instagram livestreams, so customers can click on the tags and be taken to a product ordering page. 

The company has previously let businesses list products on Facebook and Instagram, but Facebook Shops lets them upload their catalogs once to make them accessible across Facebook's various apps. 

"It's one simple and consistent experience across this family of apps, which means it is easier for people," Zuckerberg said in a live stream on Facebook. "That of course means there'll be higher conversions and more sales for small businesses."

Facebook Shops comes as Facebook ramps up its efforts to support small businesses during the coronavirus pandemic, and Zuckerberg said that he personally was involved with the development of the feature. Small businesses make up the vast majority of Facebook's more than 8 million advertisers, Zuckerberg said on Tuesday. Even though Shops is free, it will encourage small businesses to remain actively engaged with the platform. Since the pandemic began, the company has announced a $100 million program to support small businesses through grants and a way for small businesses to sell gift cards directly to consumers through Facebook. 

Long-term, Shops and other e-commerce products could help Facebook drive more ad sales, Zuckerberg said. 

"Our business model here is ads, so rather than charge businesses for Shops, we know that if Shops are valuable for businesses they're going to in general want to bid more for ads," Zuckerberg said. "We'll eventually make money that way."

Although Facebook Shops will make it easy for companies to list their products on Facebook, in most cases users will have to leave Facebook and head to a company's website to complete the purchase.

Only businesses participating in Facebook's Checkout, an invitation-only program that Facebook is testing, will be able to conduct transactions on the social network. Facebook charges a selling fee for sales completed through Checkout but has declined to disclose the amount or nature of that fee because that program is still in beta.

The company noted that it's working with partners like Shopify, BigCommerce and others to support small businesses. Shopify's stock price was up more than 2% following the news of Facebook Shops.

"Small businesses need a way to find new buyers," said Shopify CEO Tobias Lutke on the live stream with Zuckerberg. "This is going to be an incredibly powerful new reality for everyone in the retail space to have these powerful tools natively on the Facebook platform."

Facebook Shops will start to roll out on Tuesday and become more widely available over the coming months, the company said.

"We hope these tools can relieve some of the pressure small businesses are facing right now and help businesses of all sizes prepare for the future," said the statement. 

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