Meta lets Amazon shoppers buy products on Facebook and Instagram without leaving the apps

Meta doesn’t want you to abandon its popular mobile apps if you give that impetus Amazon purchase.

The company debuted a new feature that allows users to link their Facebook and Instagram accounts Amazon so they can purchase goods by clicking on promotions in their feeds.

“For the first time, customers can view Amazon’s Facebook and Instagram ads and check out at Amazon without leaving the social media apps,” an Amazon spokesperson said in a statement. “US customers will see real-time pricing, Prime eligibility, delivery estimates and product details on select Amazon product ads on Facebook and Instagram as part of the new experience.”

Meta is looking for new ways to increase ad revenue next Apples iOS privacy changes in 2021 made it harder for social media companies to target users. The update was a major blow to Meta’s business and, alongside a brutal digital advertising market, caused the shares to fall 64% last year.

But after three straight quarters of revenue declines, the company has bounced back this year, sending its shares up more than 160%. Meta has pointed to its heavy investments in artificial intelligence as a key technology that has helped it reach retailers looking to offer customers targeted promotions.

Stuart McMullin, client solutions manager for e-commerce at Meta, said on LinkedIn that the new shopping service was “a long process in the making and a huge deal.” He was responding to a post from Maurice Rahmey, co-CEO of digital marketing agency Disruptive Digital, who described the rollout as “the most important advertising product of the year” and compared it to a similar partnership between Pinterest and Amazon.

“While additional details are still scarce, this partnership could be a huge revenue opportunity for Meta, Amazon and especially advertisers,” wrote Rahmey, who was previously a customer solutions manager at Facebook.

Amazon has been ramping up its advertising efforts for several years, prompting brands and small businesses to improve their rankings in the company’s apps. Amazon said last month that revenue in its online advertising business grew 26% from a year earlier in the third quarter to $12.06 billion.

By partnering with Amazon, Meta can make it easier to let stores sell goods on Facebook and Instagram without creating custom storefronts in those apps.

Meta provided some details about the new feature on Tuesday on a support page titled “Buy from Amazon without leaving Facebook or Instagram.”

“For a more seamless shopping experience from an ad on Facebook and Instagram, you can choose to link your Meta and Amazon accounts,” the page said. “You can checkout at Amazon without leaving Facebook or Instagram and experience more relevant ads.”

Rahmey told CNBC that the agreement shows “these two walled gardens are kind of coming together.”

Amazon’s online advertising operations have traditionally been more similar to Google’s in that they are “intent-based,” meaning customers search using keywords to find the items they want, Rahmey said. Meta has more of a “discovery-based” model in which people can receive targeted ads without searching, he said.

“Amazon can expand their reach and help sellers find new customers who may not have searched for them yet,” Rahmey said. “I think it’s a win-win for everyone.”

He noted that Pinterest has seen a revenue boost in recent quarters following the Amazon deal.

Still, Rahmey says some questions remain about the partnership, such as how revenue sharing will work and how sellers will choose where their ads appear.

“If I’m an Amazon seller, do I go in and check a box that says ‘sell on Meta,’ and it just pops out from there?” Rahmey said. “Or, if I’m a Meta Advertiser, can I choose to direct my potential customers to buy on Amazon instead of, say, to my website or to other stores?”

– CNBC’s Annie Palmer contributed to this report

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