Instagram’s checkout feature introduced in May will making buying on the app more convenient for shoppers because it will store their payment and shipping information so they don’t need to enter it again when making subsequent purchases. It also has important implications for retailers, influencers and advertisers.

Fang Cheng, co-founder and CEO, Linc Global

Fang Cheng, co-founder and CEO, Linc Global

Instagram has long been a place for users to discover new brands through organic content and paid ads. Thanks to a new tool, users can now complete the entire customer journey without ever leaving the app. With the new checkout feature currently in beta testing with 23 brands (including Nike and Adidas), users can make purchases directly within Instagram.

The checkout feature removes obstacles to purchase that avid Instagrammers will find all too familiar: redirecting to a browser, creating a brand-specific website login, and entering payment info they have submitted countless times before on the same smartphone screen.

Checkout effectively blurs the lines between social media and ecommerce, and it’s a logical step forward for the social media platform. According to a Dana Rebecca Designs survey, 72% of respondents acknowledged making a buying decision based on Instagram. So why not make it easier for them to complete that transaction?

The new checkout feature will enable influencers and brands to share access to a dashboard with powerful analytics.

How Will Checkout Change Advertising and Ecommerce?

Checkout is still in beta testing, but it’s going to have a huge impact on Instagram and its users. This new feature will freshen up the world of online retail by:

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1. Removing pain points from the customer journey.

Allowing customers to make in-app purchases means users will no longer have to go elsewhere to make cumbersome browser-based purchases. According to research from eMarketer, the majority of social media users access platforms exclusively on mobile devices. Considering how difficult it can be to enter payment information on those devices, this move makes a lot of sense. The seamless nature of Instagram’s checkout means users will be more likely to follow through on a purchase intention.

2. Facilitating the efforts of sellers.

Major brands like Warby Parker are participating in the checkout beta testing, but the benefits of selling products on Instagram will extend to smaller retailers. Sellers who lack a sophisticated ecommerce presence will arguably benefit the most because they’ll be able to sell products to their existing audience without any additional effort. According to estimates from Deutsche Bank, the platform could produce $10 billion in revenue by 2021.

3. Increasing ad conversion rates.

Checkout will likely increase the effectiveness of Instagram advertising because it makes the buying process easier, but it will also benefit other kinds of advertising. Instagram is generally known as the most popular choice for influencers working with brands, and the checkout feature will only cement that position. Historically, influencers have had to share statistics on user engagement via screenshots. The new checkout feature will enable influencers and brands to share access to a dashboard with powerful analytics.

Instagram’s checkout feature is still a question mark thanks to its beta status, but there’s little doubt it will improve the platform’s potential for online retailers. Expect to see other social media companies flock to the ecommerce space, and be on the lookout for opportunities to broaden your brand’s reach.

Linc Global provides a customer care automation platform.

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