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Social networking giant Facebook.com made a big announcement today as it assimilated the changed consumer spending habits in pandemic-induced lockdowns in its various platforms. Facebook brought the 'Shop' checkout system to its application today and expanded Facebook Shops access to all eligible businesses.
At the same time, SaaS platform provider BigCommerce Holdings, Inc. (NASDAQ:BIGC) announced that it would bring its customer storefronts directly to Instagram through supporting checkouts on the application. This, in turn, would speed up the purchasing process and let shoppers avoid the need to access the merchant's website. This announcement has impressed investors and traders, with BigCommerce's stock now soaring to record highs during trading today.
BigCommerce Announces Integration of Instagram Checkout For Its Registered Merchants
BigCommerce is a new entrant to the public stock market after it offered its shares through an initial public offering (IPO) to retail investors only at the start of this month. The IPO, which took place on the 5th of this month, saw the company's shares soar by 200% during the first day of trading as the company raked in $217 million in funds generated. BigCommerce's cloud-based services allow its customers to create digital storefronts to connect with shoppers, and the company offers several services including search engine optimization for product keywords.
Today's announcement reveals that by integrating its platform with Instagram, BigCommerce will provide its merchants with the ability to provide services associated with the entire buying process to their customers directly on Instagram. In addition to supporting storefront checkouts on the application, the changes will also enable the customers to monitor their order's status, estimated delivery date and tracking number on the Instagram application. Furthermore, customers will also be able to cancel their orders and return their purchases on Instagram.
As part of its announcement, BigCommerce also confirmed that some of its merchants have already tested Instagram checkouts. During today's trading, the company's shares traded at record levels that crossed $100/share. BigCommerce's all-time high share price is $104, and the stock's highest price during today's trading stood at $103.74. The latter marks for a 332% gain over the $24/share price that the stock IPO-ed at earlier this month.
Revenue-wise, BigCommerce is on the growth trajectory as it grew revenue year-over-year at both the end of its fiscal year 2019 and Q1 2020. However, the company is yet to post profitability, and results for the March quarter reveal that BigCommerce ran into a roughly $6 billion loss - some of which was attributed to paying out dividends for investors.
Integration with Instagram brings up the total number of platforms supported by BigCommerce to six. In addition to Instagram, BigCommerce also connects its merchants with customers on Amazon, eBay, Facebook, Google Shopping and Square POS.
In addition to having partnered with BigCommerce, Facebook has also included the company's competitor Shopify on its list of platforms that support Instagram checkouts. For merchants to avail access to Instagram's shopper market, they must either use BigCommerce, Shopify or Facebook Commerce Manager platforms for their shops.
In order to be eligible for Instagram checkouts, merchants must be located inside the United States and comply with the required terms and conditions. The move to expand merchant options on its platforms comes as Facebook looks to diversify its platform monetization options away from the traditional advertisement revenues that it has come to depend on; revenues that leave its share price at the mercy of conglomerates.