When asked what he thought the top tech trend of 2021 would be, former Apple CEO John Sculley told FastCompany:
“Platforms like TikTok, Shopify, and YouTube have aligned as a third-party ecommerce fulfillment platforms system to compete versus Amazon. In fact, Facebook and TikTok are both expanding into social-media ecommerce.”
The way we see it, the opportunity is undeniable. But do social platforms have what it takes to take on the eCommerce giants like Amazon, Google, and Shopify? Let’s take a closer look at the opportunities and challenges these platforms are likely to face along the way, and what they might do to overcome them.
What Is Social Media eCommerce?
In May 2020, Facebook introduced Shops to both Facebook and Instagram. These online shops offer an improvement on the practice of creating personal posts or even using Facebook’s Marketplace to sell products. The announcement also cited an intention to help small businesses struggling with the economic impact of COVID-19 as a major motivation for the rollout.
With Facebook and Instagram Shops, small business owners can host product pages and make sales within the social media platforms. Customers discover brands, browse, and make purchases without ever leaving the app.Social apps are popular with key buyer demographics such as millennials. According to Instagram, 70% of shopping enthusiasts turn to the image-based platform for product discovery. Social media is no longer just about keeping in touch with friends. It’s becoming a way to shop.