Facebook is fighting to become an ecommerce empire

Facebook is enlisting mom and pop stores in its fight to become an ecommerce empire. Can Facebook Shops, a new platform for small businesses, take on Amazon? Probably not. But Facebook’s venture is as much about advertising as it is online sales. Mark Zuckerberg has been trying to find new ways into ecommerce for years. Americans spent nearly $600 billion on online shopping last year. Facebook believes it can leverage off its vast 3bn global user base to take a significant share of that market. So far, however, these efforts have been a sideline to the main business. Facebook’s online sales have focused on its classified ads section, Marketplace, with various ideas for payment products. Its interest in bungled digital currency Libra was linked to plans for a digital wallet… The knock-on should be more advertising — still the bulk of Facebook’s $70.5 billion revenue last year… The lone downside is the potential reputational hazard that comes from third-party sellers. Without sufficient screening, Facebook risks exposing itself to the same criticism that has bedevilled Amazon about the quality of vendors. For a company still rehabilitating its image, this is a serious consideration. The size of the ecommerce prize makes it worth the risk. 

Lex.

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