Q: In the official announcement for Shops, Facebook says, “Creating a Facebook Shop is free and simple…” However, coverage by TechCrunch quotes Facebook’s vice president of ads, Dan Levy, saying: “…that while the company will charge “small fees” on each purchase, the real monetization will come from driving more advertising. https://techcrunch.com/2020/05/19/facebook-shops/ Which is it — free or fee?
A: This is essentially free with the same model used by Etsy, Stripe, and other payment processors that either charge a flat rate based on the number of products you have or a percentage of sales. I consider it free to showcase, low cost to actually sell, but that’s obviously the real goal here. It could make it easier to see a clear ROI in ads, so I think it should be strongly considered. It only charges if you sell, so it works.
The selling fee is 5% per shipment or a flat fee of $0.40 for shipments of $8.00 or less. You keep the rest of your earnings. They say this includes tax and payment processing if the purchase is made on the platform. Disputes and customer communication are also managed through Facebook.
Q: The mention of ads is a big concern among business owners. (“…the real monetization will come from driving more advertising.”) Mainly, if a small, local business doesn’t run ads or maybe meet a certain threshold for ad spend, will their Facebook Shop still be shown, or will it not be given preference? Please share your thoughts on this.
A: I don’t know for sure, as only time will really tell, but I think it’s the same concept as profile views since the shop will be connected to your profile. Businesses who don’t advertise or advertise much on the platforms don’t get a ton of profile views except organically.
When you advertise more heavily, people will naturally go to your page more often because of increased awareness and the direct response element. With shops, however, that will be true, but you’ll also be able to advertise your products directly, maybe showing people for the first time all of the options you have, your pricing, and making it easy for them to buy. Any time you get In front of people more often with a simple solution, you’re going to see more monetization.
Q: As we mentioned at the top of the segment, Facebook Shops is very closely related to Facebook Page Shops — which have been around for a while, I presume. What is the difference between what is rolling out this week and these Page Shops?
A: “Checkout”, or the ability to pay directly through the platform, as well as financial insights and reports are new, but it’s more of evolution it appears. The shop tab has been there but wasn’t widely used or accepted. It started as redirecting to the site but then added messenger payment options. IT required the catalog, but not the commerce manager in order to use it. Couldn’t tag products on FB, just IG as far as I know, and there were no programs to push the shops unless someone went to your page to look, or you used dynamic product ads, which is what we primarily used them for.
Q: Have you heard any feedback from retailers who already have Facebook Page Shops set up? What is their reaction?
A: I’ve set up page shops for clients and they did not ever perform well, because unless they were selling online, it’s really a catalog. It can help people understand your selection, but not much more.
Q: Did they know anything about these new shopping tools rolling out?
A: No, most local business owners are not in tune with the new features enough to know about it for the most part, which is why it’s important for us to share this with them and the benefits.
Q: Facebook emphasized that Shop is built with small businesses in mind still, by all means, any seller, no matter their size or budget, can bring their business online, connect with customers, and more on Facebook. You are the expert on local marketing. Can you give us some recommendations on how local businesses can get started? And, how can they make Shops effective?
A: First, you need to decide if you want your ENTIRE product selection in shops or if you want only your best sellers or a certain grouping active. Then, you’ll want to start organizing the information. Most retailers specifically don’t have a spreadsheet with all products, descriptions, photos, links, prices, etc, based on my experience. This can take time to create. I actually developed a spreadsheet that will auto-fill descriptions, tags, etc based on attributes entered, and it can help get these set up so much more quickly because setting up a lot of products manually is REALLY time-consuming.
You also want high-quality photography and keep in mind that descriptions should be focused on WHY it matters to the buyer and the features that drive those decisions. Also, give them an easy link to reach out with questions, messenger ref URLs could be a good idea here since they’re already on Facebook.
Q: Many people like you are working with clients at their own digital agencies or media companies. From the perspective of an agency owner, how would you position Facebook Shop or Instagram Shop to a client? Would you recommend it? If so, how?
A: As always, focus on benefits.
Q: What are some considerations before jumping in?
A: Don’t put all your eggs in one basket.
I’m recommending it to all of my retail clients and students because of retail, there are certain challenges that this overcomes.
Traditionally, the most valuable thing you can do for a retailer is to get someone in their store to see what they have. Sometimes they come for one thing and stay for others, increasing the sale value. Most local retailers pre-COVID were not set up to sell online and most didn’t even showcase their product selections. For those people, I love using events.
However, if you want to drive more sales, continue to do things like that if they’re working, but focus on the hybrid model of e-commerce and local. It opens up your audience significantly but you can also sell more to the local audience you’ve already got. I would encourage them to start with a spreadsheet that can be used on Facebook and an E-Commerce website.
Don’t build your entire e-commerce solution around Facebook, that’s not smart. But, utilize all the tools available and test what’s most effective. Like lead forms and messenger, keeping users on the platform has many benefits and can be more seamless user experience. Collections you may not have considered. Ability to be found
This summer, starting in the US, they’re introducing Instagram Shop, which you can find on Instagram Explore. You can get inspired by collections from @shop, browse selections from your favorite brands and creators, filter by categories like beauty and home, and purchase the looks you love all in one place. And later this year, they’re adding a new shop tab in the navigation bar, so you can get to Instagram Shop in just one tap.
Q: Can we set up a Facebook Shop for digital products and services? Do you think it would work for digital products like classes or webinars?
A: For a Facebook page shop, you MUST sell physical products at this moment.
You need to get a notification that you are eligible for shops
You may need to create a commerce account in ads manager
You will need to create or connect a product catalog. If you already have one, you can likely use it as is. If not, you can use my spreadsheet suggestion or manually enter if it’s a small group.
- YOU MUST….
Be a Page Admin for the Page connected to your existing Facebook Page Shop
Be a Business Manager admin
Manage your Facebook Page and catalog in the same Business Manager account
Link to a US bank account
Have a Tax ID
3 Steps of setting up a Facebook Shop:
Create a collection. You can create collections of 6 to 30 products.
Customize your shop. You’ll choose your featured collection and customize the look and feel of your shop.
Publish your shop. People can see your shop once we review and approve your collections, typically within 24 hours.
REMEMBER, TO USE THIS…
To sell on Instagram, you need to get approved.
To sell on Marketplace, you need to be eligible to list retail inventory.
To sell on your Facebook Page, you don’t need to get approved first, but you do need to have a Facebook shop.
All sellers must comply with our Merchant Policies and Commerce Policies.
Have questions? Drop them below. Want to talk about working together? Visit alliebloydmedia.com/book to schedule a time to talk!