Home / Companies / News /  Facebook takes another shot at e-commerce with Shops platform

Taking cues from many tech giants, Facebook is now trying to get small businesses to sell directly from its platform. The feature, called Shops, will be rolling out to both Facebook and Instagram and allows pretty much anyone to set up their own web store using the two platforms and sell from them.

While the company has always been interested in e-commerce, Shops seems to be a direct reaction to the pandemic. “Right now many small businesses are struggling, and with stores closing, more are looking to bring their business online," the company wrote in a blog post. The company already has the Marketplace product, which is more like classifieds for people to list products. With shops, users businesses can list entire catalogues and have users browse and buy products.

“The headroom for growth is ample here," said Sanchit Vir Gogia, analyst, Greyhound Research. “But I think it’s unfair and wrong to say they can compete with Amazon. There may be an initial swing, but a critical part of e-commerce is in ensuring delivery in the last mile, which is an area that takes years to develop," he added. Facebook will also have to figure out warehousing and other aspects too.

Gogia also pointed out that Facebook has failed in attracting businesses to itself earlier, through Marketplace. “They’ve always had the bare minimum to create this was available much earlier. But if they haven’t been able to establish any credibility, that’s a big question mark," he said.

While Facebook hasn’t brought Shops to India just yet, there could be big opportunities here. Small businesses in India have been looking to sell through digital means as footfalls dry up offline thanks to the covid-19 driven lockdowns. In a conversation with Mint earlier, Jasmeet Thind, co-founder of CoutLoot, an offline to online (O2O) and social commerce platform, said his business has seen 3,500 businesses come onboard per day over the past two months. The number stood at approximately a 1000 new businesses per day earlier. CoutLoot has approximately 400,000 businesses on the platform right now.

Anurag Avula, chief executive officer (CEO) and co-founder of Shopamatic, another O2O platform, also said that the influx of merchants had increased due to the pandemic. “Typically we’ve seen people building e-commerce accessories etc. But we have seen quite a few of our merchants bringing essential services," he told Mint in an earlier conversation.

With Shops, Facebook is planning to partner with companies like Shopify, which helps businesses build their shopfronts on the web faster. Facebook will allow customers to get support or track deliveries through Facebook Messenger, WhatsApp or Instagram’s Direct Chat feature.

Of course, Facebook isn’t the only company trying to bring small businesses and merchants online either. Amazon had announced an initiative called Local Stores in India last month, which has the same goals. The company had been running a pilot for this for six months before it was made official. According to Gopal Pillar, VP, Seller Services, Amazon India, “thousands of shopkeepers" are already “taking advantage" of the platform.


Prasid Banerjee

An engineering dropout, Prasid Banerjee has reported on technology in India for various publications. He reports on technology through text and audio, focusing on its core aspects, like consumer impact, policy and the future.
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