Before we jump into what Facebook shops are, let’s start from the very basics. Commerce is a process buying and selling of goods. As online selling began, a term called E-commerce emerged – which literally implies online buying and selling. Now, in recent years (started informally by Facebook in 2007), there’s this term called social commerce that means buying and selling on social media platforms. However, it never picked up possibly because of what happened in 2008 and the lack of authenticity associated with the mediums.
The entire market of Social commerce seemed very informal since people were buying and selling stuff on Social media platforms. However, there was no one formal and trustworthy platform that could mediate this type of commerce, until very recently. Like seriously, until last Tuesday.
Facebook, the largest social media platform in the world is going to cater to local businesses with the introduction of its new Facebook shops. Mark Zuckerberg, the co-founder of Facebook, mentioned that this launch is to facilitate Medium and small businesses to survive through the Covid-19 crises. However, the falling ad revenues of Facebook hint that this may also help Facebook survive the crises. You may think of these shops as something similar to those of google businesses, but here’s the catch.
That’s just a half story!
It seems, in essence, an amalgamation of Google local business and Amazon. And yes, that means it’s sort of an online market place where you can shop and also talk, sounds exciting? It sure does.
But hold your horses. Because if you’re in India, the launch isn’t confirmed yet. And we have a theory for why this may be the case, wait till the end.
The birth of Facebook shops
Social commerce has been no fad for Instagram and Facebook, people have been buying and selling on these platforms actively. However, there no “formal” system of checkout, payments and delivery tracking which made these mediums a little legit. With the introduction of Facebook tracking, all of this will be a reality. You will be able to discover these small businesses when you’re browsing on Facebook, head to the checkout and do your payment on the ambitious WhatsApp Pay and track the delivery on these apps itself. You don’t need to use any other payment systems like Paytm, PayPal, Google Pay, etc. (which you’d use earlier).
We believe sooner or later Facebook may even introduce a delivery system which will then facilitate an entire e-commerce ecosystem on a social platform. Facebook is not going to charge any extra fee provided the sellers use Facebook’s “checkout” ecosystem, otherwise, 5 per cent will be charged.
Good stuff? Here’s the scary bit!
Facebook is infamous for privacy issues, in the video we’ve embedded above, Mark Zuckerberg mentioned that no private data will be shared “without permissions” – and we all know what that means. Most of us (none of us) don’t even read these privacy statements and don’t really know how to disable these permissions. And so, we end up ignoring! We’d recommend you disable this unless you want to end up in a situation where you bought a say a Deodorant. And the next thing you know, all your friends know what Deodorant you use.
This may especially get scary for some products. Facebook Ads will certainly make a return! In a sense that you will be targeted based on the conversations that you have with your friends on Facebook/Instagram/WhatsApp, etc. aka “personalized recommendations”…
Now, why is this huge?
Think about it for a second. Facebook is the biggest social media platform in the World. Combined with Instagram and WhatsApp forms a trio that literally makes it indestructible and omnipresent. Facebook has 2.60 billion monthly active users in the World. The company also has 1.5bn WhatsApp users and a similar number of Instagram users as well. Imagine the reach it could have, provided it goes live across the world.
This brings huge potential has for the Medium and small size business (MSMEs) and especially huge for a country like India where there’s plethora of MSME still trying to get their name out there in the Market.
But hey, do you remember who else is onboarding MSMEs on their platform lately? Here’s a hint, Facebook made a deal with them very recently!
Mr. Mukesh Ambani!
So what about the Facebook-Jio deal?
Yes, Facebook and Jio made a deal very recently and this model is very similar to what Jio is doing as well. If you haven’t read this piece, we strongly recommend you read it, we’ll add a link at the bottom.
Related: Take a look at the Facebook-Jio Deal
Anyway, so is Facebook really competing with Jio with this entry?
We don’t think so. Like we mentioned earlier this platform is yet to be launched in India – we believe more than competing with each other, these giants may join forces and wreak havoc on the current ecosystem. But that’s just a theory. We don’t know what will happen yet. But I think we’ll soon find out!
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