In recent months, Facebook Inc.-owned Instagram has been exploring various ways to transform the photo-sharing app into an ecommerce platform. And on Tuesday it took its biggest step to date in announcing that it is testing a shopping feature, called Checkout, with a handful of retailers including Nike Inc., No. 27 in the Internet Retailer 2018 Top 1000, eyewear retailer Warby Parker, No. 174, and apparel retailer Zara, No. 500.
Checkout aims to remove the biggest point of friction that shoppers have encountered on Instagram: The need to checkout on the retailer’s website. Checkout lets a shopper complete her transaction without leaving the social network. When a consumer taps on a product tag within an image to view the product details page, she will see “Checkout on Instagram.”
The first time she checks out, she is then asked to enter her name, email, billing information and shipping address; the social network then stores that information for subsequent orders. The consumer will receive notifications about shipment and delivery in Instagram.
Shoppers can pay with Visa, Mastercard, Discover and PayPal, Instagram says. As the feature expands, businesses will be able to integrate the purchasing directly or work with vendors such as Shopify Inc. or BigCommerce. While the test only involves 23 retailers, Instagram says it plans to add more brands over the coming months.
The tool could close the gap between the number of consumers who turn to social networks such as Instagram and Pinterest for inspiration and those who shop on the platforms. 18% of consumers use social media for gift ideas but only 6% shop on the platforms, according to a November Internet Retailer/Bizrate Insights consumer survey.
Already the number of consumers who interact with Instagram’s shopping tools is on the rise. For example, Instagram says more than 130 million consumers tap to reveal product tags in shopping posts every month, which is up 44.4% from 90 million in September. Throughout the past year, the social network has rolled out a number of shopping-related features, including adding shopping to its popular Stories feature and a shopping collection area that enables a shopper to save items that she intends to purchase later.
Pinterest, which is planning an initial public offering later this year, is also on a push to boost shopping on its platform. The platform earlier this month, for example, announced a number of updates to its platform aimed at helping retailers drive more sales via the platform. Among the updates are personalized item recommendations for shoppers within style, home, beauty and DIY boards based on what they’ve saved; in-stock product pins now appear at the top of search results; and a new “Shop a brand” section that appears beneath product pins that enables a merchant like Levi’s to highlight other items within its catalog.
And both Instagram and Pinterest face competition from search giant Google, which last week announced it is testing a new ad format called shoppable ads on Google Images that enables retailers to highlight multiple items available for sale within an ad that appears within Google Images results.
Instagram’s shopping push comes at a time when advertising growth in Facebook’s news feed is slowing and the company is seeking new growth channels from Instagram and its other properties, such as Messenger and WhatsApp.