As of August 2022, and March 2023, Meta will no longer continue with their livestreaming services on Facebook and Instagram, respectively. These announcements come as part of Meta’s decision to focus on Reels on the social media platforms, which are short-form video content online users are consumed with on TikTok, as well as pumping their money into virtual reality and the Metaverse. The decline in customer engagement in long form livestream shopping, post-pandemic, seems to be the main reason for the end of these services, as online users now prefer short, snappy, and to the point video content.
Content creators will no longer be able to link products and promote them in their live broadcasts but can still livestream to their followers. So, what can e-commerce learn about Facebook and Instagram no longer promoting live shopping, and why has this branch of social commerce not reached the same success in the Western world as it has in China?
In this article, we will cover the following:
What happened to Facebook live shopping?
What happened to Instagram live shopping?
The difference in the success of social commerce in the Western world vs China
What can companies learn from Meta?
What does the shift in consumer behaviour mean for live video shopping platforms? How does this impact one-to-one live video shopping?
What happened to Facebook live shopping?
Meta first debuted Facebook’s live shopping in November 2020 with the goal of making it an interactive way for retailers to sell their products, connect with viewers, and grow their businesses online. However, come less than two years later in August 2022, Facebook made a statement saying: “As consumers’ viewing behaviours are shifting to short-form video, we are shifting our focus to Reels on Facebook and Instagram”.
The announcement came just weeks after TikTok dropped plans to expand their own livestream shopping venture in Europe and the US, with The Financial Times stating that “The market just isn’t there yet… General consumer awareness and adoption are still low and nascent”.
Forbes discuss Facebook’s announcement further, explaining that although they have been regarded as such, shoppable video and livestream shopping are not the same thing. Shoppable video allows for more flexibility to attack the market, as it can be viewed and replayed at any given time with the main aspects of the product being highlighted within the video. The issue with livestream shopping in the US, however, is that “the market, primarily by way of one’s mobile phone, doesn’t work that way. Social media apps, unlike those in China, were designed for social interaction, not commerce.”
What happened to Instagram live shopping?
Another move in the series of commerce-related pullbacks from Meta is the removal of Instagram live shopping, where creators and brands who are live streaming will no longer be able to tag products in their broadcasts. Users can still, however, invite guests to their livestream and host Q&As with their viewers, as this will not impact the ability to set up and manage a shop on the larger Instagram platform.
The social media company has stated that “This change will help us focus on products and features that provide the most value to our users”, as Meta has dubbed 2023 as its “year of efficiency”.
“Though live commerce has really taken off in some countries like China, tech companies’ attempts to make social media app-based, live shopping a major income stream from U.S. users haven’t quite panned out. One October 2022 report from TIME noted that social commerce only accounted for an estimated 5% of all e-commerce sales last year” (Gizmodo).
The difference in the success of social commerce in the Western world vs China
It’s no secret that social commerce has taken off in China, yet in other countries it is not having the same effect as expected, post-pandemic. The launch of live shopping on Facebook, Instagram, and TikTok failed to attract enough consumers in the Western market to make it a financial success. This resulted in the social platforms abandoning the concept after seeing a lack of engagement and influencer opportunity to benefit from the live shopping.
The truth? This style of livestream is an unfamiliar and uncomfortable environment, and so brands and followers have adapted this at a much slower rate compared to the East.
“As a result of the larger volumes of consumers engaging with and buying via the social media platform’s online shopping channel, more influencers have also adopted the format in China. They have been incentivised to produce content with commission on each unit they sell, resulting in broadcasting for long periods of time – often up to fourteen hours – and continuously discounting the prices of the products over the hours. The combination has supported the success of Douyin’s shopping format in China compared to the comparatively poor performance in the West.” (MyCustomer).
Additionally, consumers may find the model of livestream shopping overly promotional in comparison to other formats which feel less transactional, such as one-to-one live video shopping, as this is still a new concept in the West.
Find out more about what live-stream shopping in China can tell us about the future of e-commerce.
What can companies learn from Meta?
Meta’s pullback from livestream commerce investments in the US is simple: it is very difficult to get the TikTok generation to spend an hour on one piece of content, particularly if it’s not personalised and targeted specifically for them. Additionally, the process of users selecting the product and building an online basket isn’t seamless; it often requires many tabs to be open at once, as well as a complex checkout process. Should companies wish to introduce live shopping to their sites, they should aim to make the checkout process as seamless as possible, as well as ensuring that the products and online basket are integrated into the e-commerce website. This would result in greater customer satisfaction, as well as increasing the chances of repeat customers.
What companies can also learn from Meta is to not jump too early on the bandwagon when figuring out their next e-commerce strategy. Content and research director at Influencer Intelligence states:
“Some think of it as purchasing everything in-app, some consider it as live streaming with an influencer selling products, while others believe social commerce is having shoppable tags on their content. When we can’t fully define what we mean by it because it’s so new, it shows there’s real nuance within the industry that needs to enable all brands to catch up to be able to provide that uniformity” (Digiday).
This removal of Facebook and Instagram’s live shopping has also shown the importance of focusing on products and features that provide the most value to the users. By having overly animated influencers describing the product to a large audience, it lacks the personalisation aspect to shopping, in turn reducing customer engagement. To retain consumer’s attention, businesses should focus on selling their products in a less transactional way, and instead encompass the authenticity of the brand.
What does the shift in consumer behaviour mean for live video shopping platforms? How does this impact one-to-one live video shopping?
Live video shopping platforms, themselves, are set to be successful in the e-commerce industry away from their use in social commerce. The shift in consumer’s viewing behaviour is regarded as beneficial for live video shopping platforms. One-to-one live video shopping platforms such as Confer With have utilised these benefits in a number of ways:
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Increase in website traffic
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With less users purchasing products directly on Facebook and Instagram livestream shopping, more businesses will see consumers go directly to their website
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Building better relationships with customers
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As the social commerce form of livestream shopping took value away from the products and services users were promoting, by interacting directly with customers on their website, brands are likely to build more trustworthy relationships with their shoppers
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Increase user engagement
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Particularly with live one-to-one video shopping, which is a fairly new and innovative form of online shopping, retail experts can engage one-on-one with customers, providing them with a more personalised shopping experience to truly showcase the brand’s personality
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Key Takeaways
Meta’s decision to shut down Facebook and Instagram’s livestream shopping has come as part of their broader picture to focus on AI, the metaverse, and short-form video content on social media apps. This means there is a large gap in the market for businesses to incorporate live video shopping services directly on their website, which will align perfectly with the shift in consumer engagement towards content specifically targeted towards them.
