Is Shopping on Social Media Safe?

How Do Social Media Sites Protect Shopping Transactions?

Last year, consulting giant Accenture dubbed in-app transactions "social commerce," predicting the industry will grow three times as fast as traditional e-commerce in the coming years. In a 2022 survey, Accenture found that 64% of social media users had made a purchase via social commerce.

Unfortunately, criminals take advantage of this burgeoning space to commit fraud and scams. In a 2021 study, the Federal Trade Commision (FTC) found that over one-fourth of fraud victims traced their issue to a social media ad, post or message. Among the 95,000 social media-related fraud reports the FTC received that year, nearly half involved losing money from shopping. Around 70% of those respondents said they placed an order, often from an ad on Instagram or Facebook, but never received anything. Some were due to ads that took unsuspecting users to "lookalike" websites impersonating real retailers.

Scams are ever-evolving, especially as technology creates new opportunities for thieves. Every social media company has their own policy on what's allowed, though some offer more protection than others, and it's hard to tell how well they're enforced. Some policies even vary by the type of shopping within a single social media platform.

How Instagram Protects Purchases

Instagram has third-party ads that show up in feeds and take you elsewhere when clicked—but it also has a "Buy on Instagram" portal where you can make purchases directly in the app. You might also end up buying something that you saw posted by an account and clicking on a link in their profile or in a story.

The "Buy on Instagram" feature is more regimented and includes secure purchasing without leaving the app, and it covers some items with their purchase protection policy. If you buy something eligible for purchase protection that turns out to be a scam, damaged or otherwise problematic, you can report it and potentially get a refund if you can't resolve it with the seller. This doesn't cover purchases on third-party sites—only those directly in Instagram and labeled as covered by their protection policy.

How Facebook Protects Purchases

Facebook also has targeted ads pushing products, but one thing that makes it unique is its Facebook Marketplace, where you can buy from individuals, often in person. While the platform's policies ban scam and counterfeit listings, there's not much recourse for buyers when things go wrong.

If you make a local transaction that goes south, you can contact Facebook support and report the seller so they can potentially be banned from the site, but you may not get your money back. If you buy from a non-local Marketplace seller that allows in-app payment, some purchases may be protected by Facebook, but you'll have to look closely to ensure your transaction is eligible for coverage.

The protection offered varies by how you shop. Meta, parent company of Instagram and Facebook, has policies prohibiting ads for scams, fraud or deceptive practices. Users can also report suspicious ads. Nevertheless, a quick online search will reveal horror stories of those that get through. And once you lose money to a scam ad or user, you may not have recourse.

How Snapchat Protects Purchases

Snapchat has in-app ads, along with lenses that allow virtual reality try-ons and purchases. The app's policies prohibit anything illegal, fraudulent or inappropriate—but again, it's hard to keep all scammers from slipping through. The app doesn't explicitly lay out policies protecting you if you make a fraudulent or otherwise bad purchase, so be very wary when making a purchase on Snapchat.

Pros and Cons of Shopping on Social Media

Here's a quick run-down of some of the pros and cons to shopping on social media:

Pros of Shopping on Social Media

• Discover new, small or niche brands and retailers that appeal to your unique interests.
• Some social media shopping is tied to what's new and trendy, allowing you to catch trends as they emerge.
• In some platforms, you can conveniently complete the entire transaction without leaving the app.

Cons of Shopping on Social Media

• Sellers aren't always vetted thoroughly, and scams slip through.
• You're required to do research to ensure a retailer is reputable.
• Only some purchases are protected by the social media company; there may not be recourse if you get scammed.

Best Practices for Shopping on Social Media

Not all social media ads and sellers are scams, but before you hand over your money, make sure to follow these tips to avoid problems.

• Verify unknown sellers or websites. Before you make a purchase with a retailer you've never used, do some research. Run their name and website through a Google search for intel and pay attention to review-based sites like Trustpilot. Check the Better Business Bureau's Scam Tracker for recent complaints. The FTC has some helpful tips on researching online shops. If you find a website, click around, look for an about page and see if there's anything fishy like typos.
• Ask your network. If there's something you really want to buy but are unsure, consider making a post on that platform asking if anyone you know has made a purchase from that retailer. It's possible someone with similar interests or demographics has been served the same ad or encountered the seller.
• Pay with a credit card online. When shopping with an unknown retailer, avoid debit cards if possible. That's because debit cards remove cash from your checking account, and if you wait too long to report the fraud, you may only get some—or even none—of it back. With credit cards, the issuer pays the expense initially, and you later pay them back. Because of this, federal law minimizes a cardholder's liability to only $50 for fraud, though most issuers provide zero liability to users. Using a credit card reduces risk when shopping online, especially on social media.
• Use a virtual account number. Some credit card issuers offer a feature that allows you to use temporary virtual account numbers linked to your account. This offers an extra layer of protection by keeping your real card number secret. If the virtual numbers are stolen, you can cancel that disposable card without having to close the entire account and get a new physical card. These can be especially helpful when taking the risk of shopping on social media.
• Trust your gut. If something seems too good to be true, it probably is. Counterfeit goods aren't allowed on these sites but do squeeze through, so avoid purchases with prices that seem too low. Also, be wary of "influencers" that may not seem legitimate.
• Be careful with marketplaces. If you're using Facebook Marketplace or something similar, you may have to meet a stranger in person. Avoid common marketplace scams, like asking for payment upfront. Meet in a public place, and if you have to go into someone's home, bring another adult with you and let someone else know where you're going. The easiest and safest way to pay in this situation is usually with cash.
• Protect your information. Take measures to protect your identity online, especially enhancing the privacy of your social media accounts to display less information to the public. You can also opt out of targeted ads on some platforms, which reduces how much information is shared about you, according to the FTC.

Protect Yourself and Your Credit After a Purchase

If you've already made a social media purchase and fear you've given your information to a risky retailer, you can take proactive steps to minimize any damage. Regularly review your card statements for unrecognized charges, and consider monitoring your credit to make sure no new accounts have been opened in your name. Experian's identity protection plans include credit monitoring, along with other tools like monitoring the dark web for your information. If you've confirmed you're a victim of fraud, you have the right to take additional steps such as contacting your card issuer, the credit bureaus and law enforcement.