The launch of Facebook Shops has far reaching implications. It could ultimately change the way small businesses operate, possibly forever. The idea that the local mom-and-pop shop can now have access to a global audience and even operate without a storefront brings with it excitement and inevitably, lots of questions.
Shops’ launch is timely and desperately needed, as a fifth of small businesses in the UK are ‘at risk of collapse within a month’, according to a recent article in The Guardian. Facebook Shops will also help accelerate digital adoption for small businesses which is crucial given in the UK alone, 25 million people prefer to shop through their mobile phone. However, only 18% of SMEs have optimised their services for mobile use, according to Lloyds Banking Group.
And with the majority of the UK still stuck at home, there’s a desire to feel connected and part of anything beyond our immediate four walls.
A frictionless customer experience
With Facebook Shops, customers can click on an ad, try on products using AI technology and move to purchase, all without leaving Facebook platforms. Payment information can be saved and applied automatically, making it easy to pay, with higher conversion rates and fewer abandoned purchases. There’s an opportunity to engage with customers through the journey to support the transaction process and provide customer service through WhatsApp.
Anything that removes a step or two from the buying process is likely to boost sales. The benefit here is really a reduction in friction. And if customers already have a relationship with a small business, Shops acts as a facilitator, giving them another way to buy from a brand they trust.
Facebook Shops has the potential to change the nature of small business in a number of other ways:
Building on the community spirit forged during the coronavirus crisis
The global pandemic has resulted in a sharp rise in collectivism, with people pulling together in the interest of their communities. Recent ONS data reveals that more than half the population said they felt an increased sense of belonging to their community. #Shoplocal is being used three times more per week than it was in April and online conversation around ‘community spirit’ has increased 82% in the last month. Facebook Shops has placed itself at the centre of this goodwill and will be a part of the recovery plan for local communities.
Local provider to global trader
The local corner shop now has the potential to reach a global network, overnight. Access to new customers, cultures and collaborators will impact the way in which stores stock and sell product.
Easy to discover shops
Luck and proximity will no longer be key factors when it comes to finding retailers. Small businesses can build their profile and attract new audiences without worrying much about their stores’ location.
The end of perusing
The customers that never enter a store will never have a chance to peruse, wandering down the aisles, looking for gift inspiration, or something fun they can indulge in. If they haven’t seen a product on a profile, they won’t go out of their way to dig.
Conversely, inspiration leads to in-the-moment purchases
It’s crucially important to offer customers access to what they want, in the moment they want it. Eight one percent of smartphone purchases are spontaneous, according to Klarna, and a study from Slickdeals reveals that we spend $5,400 on average a year on impulse buys. The food pictures, the new outfit post, the perfect ceramic bowl – we’re all inundated with newsfeed images daily and inspired in-the-moment to buy what we see.
Now it’s possible to move straight from the picture to purchase, with the ability for anyone to tag products in posts. People will be inspired by influencers, friends and the shop itself to buy instantly. And super fans who help generate income could be rewarded in return.
What’s in it for Facebook?
Facebook is helping local businesses but is also helping itself by aggregating more data across the marketing funnel to sell to advertisers and businesses. It has created an easy-to-use, free platform with a captive, segmented audience to sell to in a time of crisis.
Whatever the motivations. Facebook Shops is the shot in the arm that small businesses need in these challenging times, but there’s no doubt that it will change our relationship with local shops going forward.
