As Main Street crisis worsens, Facebook launches new small business platform
Jon Nazca | Reuters
Facebook is increasing its focus on the small business community, launching a new interface called “Business Suite” on Thursday which is targeted at small businesses that have struggled throughout the Covid-19 pandemic.
The platform is available exclusively to small businesses at launch, according to a release from the social media and advertising giant, but it will expand offerings to larger businesses next year.
“This is a long-term investment to make this the main interface for businesses of all sizes who use Facebook, Messenger, Instagram and WhatsApp,” said Facebook COO Sheryl Sandberg in a statement announcing the new platform.
The focus on the small business community comes as Facebook has faced a number of challenges. On Tuesday, a group of celebrities including Kim Kardashian West, Katy Perry, Michael B. Jordan and Ashton Kutcher, participated in a 24-hour Instagram “freeze” as part of the Stop Hate For Profit movement to protest what the organization calls “Facebook’s repeated failures to address hate speech and election disinformation on their platforms.”
During the summer, many prominent corporate brands took a break from Facebook ads to highlight their concerns over the same issues.
Facebook CFO David Wehner noted in its Q2 earnings discussion that the top 100 advertisers represented 16% of Facebook ad revenue, which was a lower percentage than a year ago.
This year, the company has deployed information centers as a tactic to combat the spread of misinformation on Facebook and Instagram. The company launched a Covid hub in March, and in August, Facebook rolled out a voter information center.
Facebook also is among the big tech firms under pressure from the federal government and facing potential antitrust action.
At a virtual CNBC event last month, Sandberg said the social media company needs to work with whoever wins the 2020 U.S. election to address their concerns about dominant technology companies.
“We know that there’s real concern about the size and the power of the American tech companies, both here in our country and around the world,” said Sandberg, speaking at the CNBC Small Business Playbook virtual summit. “It’s our job to work with anyone who’s in office, whether they’re in the Senate or anywhere around the world, to address those concerns.”
In the wake of ongoing social unrest throughout the U.S., Facebook recently announced that it’s dedicating $40 million from its $100 million small business grant program to 10,000 Black-owned businesses in the U.S. Those grants include $2,500 in cash and a $1,500 Facebook ad credit. Facebook is also updating its Businesses Nearby platform, announced in May, to surface Black-owned businesses within the tool so people can discover them more easily.
Despite the ongoing fallout that surrounds Facebook, engagement and reach are critical to small business owners. The pandemic has caused dramatic economic upheaval, putting millions of Americans out of work as governments ordered nonessential businesses to temporarily shutter in order to help slow the spread of Covid-19. For many small businesses, the closures may end up being permanent.
About 60% of over 163,000 total business closures reported on Yelp since March were permanent, according to data from the reviews platform available.
There are several small businesses that have already put the new Facebook product to use.
“Facebook Business Suite makes it faster and easier to analyze post results from both Facebook and Instagram all in one glance,” said Amanda Stefl, owner and operator of Timber Hill Winery in Milton, Wisconsin. “The inbox feature organizes messages and comments nicely, making it effortless to reply to customers, which will increase our engagement and reach on both platforms.”
Facebook also rolled out a series of 30 online video classes for entrepreneurs during the summer, covering topics like marketing, online branding and finding customers, and which Sandberg, speaking at the recent CNBC virtual event, said had been watched by 15 million people.
According to a recent Facebook report, published in partnership with Deloitte, nearly half of small business owners surveyed who advertise on Facebook said they have spent more money online overall since the outbreak. Additionally, 40% of small business owners have increased their use of social media and online messaging for product and business recommendations.
Many small business owners are behind in creating their online presence. In the United States pre-Covid, one in three companies still did not have a website, according to Facebook. But those online are growing digital sales. Earlier this year, in partnership with the World Bank and OECD, Facebook published its first Global State of Small Business report, surveying more than 30,000 small business leaders across more than 50 countries. In the majority of countries, at least one-third of SMBs reported earning a minimum of 25% of their sales from digital channels in the previous 30 days.
“180 million businesses use our family of apps every month,” said Rich Rao, Facebook’s vice president of small business, adding that nine million of those businesses advertise with the company every month. “Our vision is to have a single place for those people to manage their business.”