Everything you need to know about Facebook Shops, and what it means for small businesses

Earlier last week, Facebook just announced its biggest move into e-commerce to date – through the introduction of Facebook shops. Here’s everything you need to know about Facebook Shops, and what it means for small businesses:

According to Facebook’s State of Small Business Report, 1 out of 3 businesses are closing their doors due to the Covid-19 pandemic. There are also various other challenges such as access to capital and the lack of demand.

The good news is, despite that, small business owners still remain optimistic and resilient. (Both are traits that I see in the most successful business owners I know)

As such, Facebook CEO Mark Zuckerberg describes this initiative as an effort to help businesses suffering in the wake of Covid-19

Everything you need to know about Facebook Shops and other ecommerce features

Facebook Shops

According to Facebook, this new e-commerce feature will make it easy for businesses to set up a full fledged Facebook Shop

Firstly, creating a Facebook Shop is free (and simple). Businesses will be able to set up a single online store (Shops) that are both accessible via Facebook and Instagram.

1 interface setup for both Facebook and Instagram

Facebook Shops

Instagram Shop

These shops are highly customizable. Businesses can choose the products they want to feature and customize their shop with a cover image and accent colors that showcase their brands

Shops will also be integrated across various Facebook apps. This means that people can discover Facebook Shops on a business’ Facebook page, Instagram profile, or through stories and ads.

In terms of customer service, if a customer needs assistance or more information, they will be able to connect with a business through WhatsApp, Messenger, or Instagram Direct

In the future, customers will also be able to view a business’ shop and make purchases right within WhatsApp, Messenger, or Instagram Direct

Facebook Shops WhatsApp Integration

Currently, Facebook is working with big names like Shopify, BigCommerce, WooCommerce, ChannelAdvisor, CedCommerce, Cafe24, Tienda Nube and Freedonomics to help small businesses grow their Facebook Shops and adopt other commerce tools

With regards to this partnership, as stated by Shopify: “Facebook Shops allow Shopify merchants to get control over customization and merchandising for their storefronts inside Facebook and Instagram, while managing their products, inventory, orders, and fulfillment directly from within Shopify”

Instagram Shops

Facebook will also be rolling out Instagram Shops in the US this summer. Through Instagram Shops, users will be able to browse selections from brands or people that they follow, or filter them by categories

Live Shopping

Businesses who make use of Facebook live to connect with users or showcase products will soon be able to sell on live videos. Reportedly, they will be able to tag products from their Facebook shop or catalog before going live, allowing products to be shown at the bottom of their live video – which users can learn more about or purchase immediately

Loyalty Programs on Facebook

Facebook is currently testing ways for businesses to connect their loyalty programs with their users’ Facebook accounts. This way, users will be able to easily access and keep track of their points and rewards. Facebook is also currently exploring ways to integrate their loyalty programs with Shops


What this means for small businesses

The shift from discovery to purchase

Facebook used to be a platform for discovery. We go to Facebook to discover things – What’s happening with our favorite celebrity. Who gave birth to their first baby. Who’s ex cheated on who – You know. Normal people stuff

People seldom go to Facebook with the intention of buying things. That is why marketers find the best success with Facebook ads by first building a relationship and engaging with prospects, then gently selling to them through remarketing.

Remarketing : Targeting specific ads to people who are already familiar with your business and have a higher propensity to purchase something

IMHO, Facebook is trying to close the loop from discovery to purchase. They have been trying to do so with the introduction of the Facebook Marketplace a few years back. 

If Facebook Shops is launched successfully, this might just be the answer to that

With users starting to go to Facebook to both discover and buy things, small business owners will have to adapt their marketing strategies to better capture sale opportunities on Facebook

(Even) Lower barrier of entry

When DIY website builders such as Wix and Weebly came along, it became easier for small businesses to go online

When E-commerce platforms such as Shopify came along, it became easier for small businesses to sell online

However, small businesses still faced hurdles such as basic technical knowledge. And some are deterred even by the basic monthly fees that E-commerce platforms charge

With Facebook Shops coming into the market, both these barriers will be virtually eliminated, leaving no excuses for small businesses not to go online.

Bear in mind, lower barriers also mean an increased competition. This means that small businesses will need to find more creative ways and build a strong business foundation to differentiate themselves

David vs Goliath

On the other hand, lower barriers means that small businesses will be able to compete better with established brands or retail giants.

With the right online tools, coupled with their flexibility and the ability to provide personalized service, small businesses can truly become a force to be reckoned with

To bring this up a notch, some small businesses might even come together and pool their resources to be more competitive.

Fun fact: This is common in the travel industry where several smaller players form consortiums to offer better travel products

Richer customer data

One of the  uniqueness of Facebook advertising is that marketers can target their prospects by interests. Because of that, Facebook has long been a strong platform for small business marketers

Facebook is able to offer targeting options like this because of the social activities of its large user base. If people start to actively buy and transact on Facebook, I can only imagine the data Facebook will have by linking user interests to their purchase behaviors and intent

With these additional data, small business owners can reach out to their customers and prospects more efficiently. Even more importantly, small business owners can reach prospects at the correct moment when there is a purchase intent

It’s yet to know how Facebook advertising options will change with the introduction of Facebook Shops, but as a marketer, I sure am looking forward to it

Better customer experience

Facebook shops, Instagram Shops, Live shopping, Loyalty Programs on Facebook – all these are meant to provide a customer with maximum convenience and a seamless experience

Facebook is trying to enable their users to discover new things, get information about products they are interested in, and purchase them all without leaving the platform. As a result, this will give consumers a better overall experience

A positive brand experience goes a long way, especially for small businesses. A highly satisfied customer brings in 2.6 times revenue compared to a somewhat satisfied customer; and 14 times compared to a somewhat dissatisfied customer

On top of that, acquiring a new customer costs up to 5 times more than retaining an existing customer. With statistics like this, it makes more sense to try to retain and satisfy your existing customers. 

Loyalty programs might trend again

According to Bond’s 2019 Loyalty Report, the influence of loyalty programs continue to be stronger year over year. 

In other words, loyalty programs work.

If correctly designed, a loyalty program can drive great business results for a business

The only challenge? Experience

According to the report, 4 of the 5 top drivers of member satisfaction and engagement are related to experience. If you’re curious, the five drivers are:

  1. Meets needs
  2. Enjoy participating
  3. Makes brand experience better
  4. Consistent with brand expectations
  5. Rewards/Benefits appealing

At this point of time, it is yet to be known how Facebook will help businesses integrate their loyalty programs on the platform. But if it improves customer experiences and provides convenience, loyalty programs will possibly be trendy again


The whole announcement from Facebook is still relatively new and further details remain unknown. However, given the following facts that we do know currently…

  • Facebook is trying to make it even easier for small businesses to come online
  • They are emphasizing the importance of small businesses to economies worldwide. In fact, CEO Mark Zuckerberg even mentioned in his live video announcing Facebook Shops that the majority of people that advertise on facebook are small businesses
  • The big user base of Facebook’s various platforms
  • Their attempt to better integrate and improve the user experience of these platforms 

… I really welcome these changes as a small business owner  



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