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Thursday December 17, 2020 |Big tech trends

The coming rise of ecommerce on Facebook

Facebook has established itself as a primary mode of acquiring customers for countless digital businesses. When major retailers staged a boycott of Facebook ads this past summer, it hardly made any change in Facebook's revenue because the platform is incredibly well diversified across millions of advertisers. Advertisers have typically sent users to a third party site in order to make the actual sale and that's about to change as Facebook moves up the funnel.

Instaram Shops were introduced this year and have only started to see adoption by retailers. This will shift in a meaningful way in 2021 as Facebook pushes its advertisers to move the transaction portion of the sales directly on its site. Rather than giving away transaction fees and sending users to another platform, Facebook will allow make it easy for customers to complete the purchase directly on their site.

This has been in the works for months, and was in some ways inevitable. Facebook is already the starting point of many digital journeys and its natural for them to grow vertically. Its also unlikely to be entirely unrelated to the coming moves by Apple to disallow third-party tracking cookies. With that move, it will become harder for advertisers to track effectiveness of campaigns on third party sites, while purchase on a Facebook owned platform will be easily trackable.

Regardless of the public opinion of Facebook, it has an enormous share of attention and it's digital property has grown immensely in value. The company has laid the groundwork to enable advertisers to enable shopping directly on its platforms, and customers more accustomed to shopping anywhere there's a buy button. Facebook's ecommmerce opportunity is enormous and it's just beginning.

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