AI and AR features
Facebook has announced that it is expanding the Shops feature in WhatsApp and Facebook Marketplace, which could improve their monetisation and turn the company's apps into online shopping platforms. Facebook also announced new artificial intelligence (AI) and augmented reality (AR) features for online shopping.
Facebook now generates its gigantic 97% revenue from digital advertising, with executives seeing more opportunities for Facebook's family of apps in e-commerce.
On Monday, the company said it was expanding the Shops feature, launched a year ago in the Facebook app, into WhatsApp ("to companies in certain countries") and Facebook Marketplace in the US, which will enable US merchants to offer their Shops products on Marketplace, reaching over 1 billion monthly users worldwide.
According to Facebook, Shops' audience has grown to more than 300 million visitors per month and about 1.2 million active sellers per month in a year.
AI and AR technology
Facebook has announced the launch of new technologies such as Instagram visual search and dynamic augmented reality advertising, which it believes will secure the future of shopping.
For example, with AI technology, shoppers will be able to select an item they like and the app will suggest where they can buy something similar.
Many brands are already testing similar features in Facebook's apps, as well as those of competitors such as Snap (SNAP).
Another key benefit that various brands and companies can observe on Facebook platforms is the personalisation and targeting of advertising.
By owning a wealth of data about users and their actions across Facebook's family of apps, the company's computer algorithms are able to 'personalise the shopping experience' with advertising.
Thus, by investing in technologies such as augmented reality and artificial intelligence, Facebook will help users visualise items before they buy, and with personalisation, create the most relevant and targeted ads. Facebook believes this will become the new norm for future shopping behaviour.
Facebook shares, up 24% YTD and 41.7% over the past 12 months, hit a new high of 52 weeks yesterday before trading opened.
