Instagram took its next step to becoming a full-fledged commerce business a few days ago, announcing that it is bringing a checkout feature to its mobile apps. With checkout, you can store your payment informationwith Instagram to make purchases more quickly. In return, Instagram is charging retailers a selling fee. More than 20 brands will use checkout to start, including Nike, Adidas, Dior, H&M, MAC Cosmetics, Michael Kors, Oscar de la Renta, Prada, Uniqlo, Warby Parker, and Zara. Instagram believes shopping represents a massive new business opportunity. It was reported that 130 million people a month tap on product tags in shopping posts.
Where shopping via Instagram used to take the buyer to an external website, it’s now all done within the app, including notifications about shipment and delivery, etc. Users will need to enter their name, billing and payment information, and shipping address only the first time. After that, it’s literally shopping at the tap of a screen. For now, payment information stored with Facebook will only be used on Instagram. But it’s easy to imagine Facebook letting you use your credentials elsewhere in its family of apps. In the meantime, Facebook says it won’t share your payment information with other users or with retailers. Now is the time for Instagram users to ensure that their passwords are secure. Better yet, take advantage of the two-factor authentication that Instagram offers, especially once all of your billing information is connected to your account.
Source: https://www.nytimes.com/2019/03/19/style/instagram-wants-to-be-your-mall.html
That’s pretty interesting that Instagram/facebook is trying to establish itself as an e-commerce company. It makes sense that instagram would implement this feature since there are millions of users on instagram that both market, model, and purchase fashion items from various brands. Eventually, I am sure technology companies will start to allow customers to purchase their products this way (Dell, Apple).
This move to commerce shadows a Chinese company called Tencent. Tencent developed an application called “WeChat” that is a mashup of various features – social media, commerce, booking appointments, etc. So it looks like Facebook is trying to develop a similar solution with its applications.
I think adding this component in the Instagram app is a great idea! One click checkout is very convenient and I think adding this feature will make shopping much more easier and convenient. I think it would be cool if some influencer and department store pages gave the customer direct links to the piece of clothing or jewelry that was being advertised. That way the customer could see the price and buy it right away if it was available. In terms of privacy, I do see some concerns here. Keeping credit card numbers stored on a social media app does have risks, especially because they are not as protected and previous instances have shown that social media sites are not the most secure.
I think this is a great strategy for Instagram. They already have a platform with tons of influencers promoting products and actual ads promoting products so it makes sense to make purchases easier. The only issue I can see is that if Instagram eventually becomes too commercialized and rather than a social media platform it becomes a market place for big companies and also individuals. I think its still a good strategic move for Instagram and will prove to create more ad revenue. I think Instagram is looking at its platform with the idea of systems thinking in mind and starting to make its platform more seamless and making one big system rather than just taking you to a third party site to buy the goods.
I think this is an interesting move for Instagram. As they are part of the same company, they have recently mastered the e-commerce aspect of tech with the FB Marketplace. I think this is a good move considering Instagram’s main audience is young adults, and many fashion related pages are very popular on the site. This could be great for the sellers to be able to post products and have customers be able to purchase so easily. Young adults are also the most likely to adopt a newer technology like this, so that is their bests chance for success.