Facebook Shops is tech giant's new online marketplace

Facebook is launching a new online shopping marketplace called Facebook Shops, CEO Mark Zuckerberg announced Tuesday.

Why it matters: To date, most Facebook commerce has taken place between users via its Marketplace tab, a Craigslist-like feature, but Facebook Shops is at the center of its push to create an e-commerce platform for businesses.

The big picture: The move comes as more people are increasingly migrating to e-commerce during the coronavirus pandemic.

• "A lot of these aren't just businesses, they're pillars of our communities that people have poured their lives into. ... One of the ways small businesses are surviving during this period is moving online. I think this is going to be a big part of the future of commerce anyway, but it's more important right now," Zuckerberg said.
• He also added that more than 160 million small businesses around the world use Facebook services — mostly for free.

The state of play: Facebook Shops launches Tuesday in the U.S. It'll be free for businesses across Facebook and Instagram, allowing them to choose the products they want to feature and customize the look and feel of their shop with a cover image and accent colors.

• Users can discover Facebook Shops pages on a business' own Facebook page or Instagram profile — as well as through stories or ads. Customers can also purchase through Facebook or Instagram using the company's virtual payments portal.
• Users can message businesses via Facebook's messaging apps — WhatsApp, Messenger and Instagram Direct — to ask questions or get support. The tech giant says that in the future, users will be able to check out directly via those apps.

• Zuckerberg said that Facebook Shops will eventually include augmented reality, allowing customers to try items on from home.

Facebook says it's also introducing Instagram Shop, beginning in the U.S., to help users buy products they encounter via the app's Explore tab.

• It's also making it easier for influencers to hawk products via livestreams.

Between the lines: Facebook says it's working with commerce partners like Shopify, BigCommerce, WooCommerce, ChannelAdvisor, CedCommerce, Cafe24, Tienda Nube and Feedonomics to give small businesses the support they need.

The bottom line: This is Facebook's first step toward creating a competitor to more established online marketplaces, like eBay or Amazon.