It was only a matter of time before Facebook made a major play for in-app purchasing. Instagram Checkout has been around since March 2019, and while it’s limited to select partners, it’s grown significantly. Just last month, Target became the first mass retailer to add Checkout. In April, Shopify launched its Shop app, allowing shoppers to browse, buy, and track orders from multiple stores in one place.
What sets Facebook Shops apart is its potential to create a frictionless buying experience at massive scale. If a business has enabled checkout, purchases are completed without leaving the app. Sounds perfect, right? Your customers already live on Facebook and Instagram; moving e-commerce there should mean lower acquisition costs. In fact, if you can host products natively on Facebook and Instagram, why bother managing an external website at all? Think how much work that is!
The problem with things that sound too good to be true is, well, they’re usually too good to be true. Don’t get us wrong — there may be opportunities in Facebook Shops. But before you rush in, we have a few words of caution.
It’s right there on the Commerce Manager Landing page:
We don’t share customer data, aside from information needed to fulfill orders (name, email address, and delivery address). Customer email addresses cannot be used for marketing purposes.
In other words, Facebook controls your relationship with customers who buy through Shop or Checkout. You can’t email them with product updates, company news, or any non-transactional information at all. Yet email is the closest thing businesses have to a direct relationship with customers. It’s free communication, without fear of a tech giant hiding your messaging.
Over time, if fewer people are in direct communication with you, and Facebook controls access to your audience, they’ll almost certainly implement a pay-to-play scenario. It’s happened before: Remember when Facebook drove publishers to make video content, only to de-prioritize video a year later? Nobody knows what Facebook will do, but we know they have a history of algorithm changes that reward some types of content and penalize others. They may decide to make Shop content harder to find or increase CPMs, and you’ll have no recourse.
Just as Facebook controls Shop customer data, it also controls engagement data, and you won’t get to see it.
Site traffic data is incredibly important if you want to understand your customers’ needs and wants. From a simple pageview report, we can gauge interest in certain products, improve messaging, and, of course, remarket to users based on their behavior. That last point is key: With Facebook Shops, you won’t be able to build audience pools based on user behavior. You won’t even be able to create lookalike audiences from Shop/Checkout behavior. (Sources say that Facebook is working on rolling this out sometime soon.)
From a UX standpoint, Facebook Shops will solve the common problem of slow website loading time, which we know can deter purchases. Faster loading time = more consumer spending = more data, none of which you’ll be able to use. Eventually, Facebook may even make their own branded products using sales and behavior data from your customers. That’s exactly what Amazon did.
Facebook charges a 5% fee for every purchase. Let’s see how that compares to the competition:
Ouch.