Facebook’s E-Commerce Plans Could Shift Digital Markets

Instagram may not come to mind when chasing down online sales, but Facebook's photo-oriented property very well may become an online storefront through a partnered app.

News of Facebook's intentions to step into the realm of storefronts run by artificial intelligence broke as early as July revolving around a plan to integrate shopping directly into its Messenger chat app. While the broad strokes of the patent seem more or less accurate, it turns out Instagram may be the more lucrative choice of app to integrate.

A history of (poor) experiments

Just to be clear, this isn't the first time Facebook has attempted to step into e-commerce. March of last year saw the release of Instagram Shopping, a feature native to Instagram that allows users to make purchases through posts made by companies or storefronts. They've also entered the trial phase for Shopping on Instagram, a similar feature that allows users to shop through their stories. With more retailers moving into guerrilla marketing and drop shipping, Instagram will simply be the latest attempt to close the gap between social media and shopping.

It's no huge surprise that Instagram would be maneuvered into digital sales and marketing; With over one billion users and as many as 25 million business accounts on the Instagram platform alone, it seems ripe for some sort of marketing integration to make up for the lack of fees charged by the service, ad revenue aside.

Businesses as a whole are shifting into social media as a marketing scheme that often requires little initial investment when compared to traditional television or physical advertising, depending on how they approach that advertising and e-commerce as a whole is expected to become a four trillion dollar market by 2020.

RetailDive's July report noted some interesting cultural barriers stopping social shopping from taking off earlier than it has. Specifically, Western countries tend to view social networking and shopping as two separate activities while those living in Asia tend to blur the lines between the two more easily. If you've ever been pushed away from social media posts because they felt clinical or like an advertisement, you've probably experienced why Facebook's previous pushes into the market may have failed.

Instagram's e-commerce endeavor

In a move that will surely not cause any confusion, Instagram's new shopping app may sport the moniker of IG Shopping, sharing a name with the app's native in-story purchasing features. IG Shopping is supposedly slated to be a standalone app that allows its users to sort through goods offered by businesses and individuals they follow on the main Instagram app.

With as many as eighty percent of users following a business account on Instagram, it seems natural to offer cross-app integration without dropping more shopping features into the main app. Major overhauls that introduce features like digital storefronts can add to application bloat, which Facebook may be trying to avoid by keeping IG Shopping to its own self-contained instance.

Initially, IG Shopping will have to test its mettle against established e-commerce sellers like Shopify, which runs both a digital e-commerce market for merchants as well as offering point-of-sale features for small sellers who need solutions for credit card transactions. Considering Shopify has partnered with Amazon and offered native Amazon integration, Instagram's share of the market is all but guaranteed to meet stiff competition as it seeks to establish itself.

Finding footing amongst a solid user base will require IG Shopping to focus on something less broad than Amazon's wide-cast net of offering daily living essentials and niche gadgets; They might be wise to take an Etsy-like approach and focus on the natural appeal of seeing photos of products in use and being able to snag it without tracking down exactly what the product might be, especially if they focus more on individually crafted goods rather than mass-produced items. Still, expect big businesses to continue to advertise through Instagram for as long as it remains profitable and don't be surprised if there are more pairs of designer shoes up for sale than kitsch knickknacks.

If anything, IG Shopping is likely to be just another step towards rolling the digital side of our lives together into one homogenised platform. Expect to see more Instagram stories pushing for sales and more digital marketing to swing towards social media than ever before just as much as you might expect Facebook to take another misstep towards launching another failed sales platform.

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