Instagram recently announced that the social media platform will build a shopping app.
The app, which might go by the name of IG Shopping, will allow users to browse through collections of goods from merchants that they follow and purchase them directly within the app, according to two people familiar with the matter. However, Instagram declined to comment.
It is still not clear when the app will be launched to the public as its development is still ongoing, and it could be cancelled before it is released. But sources familiar with its development say that Instagram believes it is well positioned to make a major expansion into e-commerce.
More than 25 million businesses already have Instagram accounts, and 2 million of them are advertisers, Facebook Chief Operating Officer Sheryl Sandberg said on the company’s most recent earnings call. Four in five Instagram users follow at least one business. Creating a standalone app would allow the company to provide a dedicated home for an increasingly popular activity on Instagram while also expanding opportunities for revenue.
Over time, Facebook could introduce more tools for merchants who are building their businesses on Instagram, directly challenging e-commerce platforms like Shopify, according to a person familiar with the company’s thinking.
Some companies already sell such tools to Instagram advertisers. Four Sixty, for example, lets businesses pay for help creating shoppable photo galleries, content moderation, post scheduling, and other services. Shopify’s app store contains dozens of plugins related to promoting and managing Instagram-based businesses.
Instagram began testing a shopping feature in November in 2016 and rolled it out more broadly in March 2017. Companies can tag posts with individual products, allowing users to shop directly from photos. Instagram is currently testing a feature that will allow users to shop straight through Instagram stories.
Shopping would not be the first Instagram feature to be spun out into a standalone app. The company has been testing Direct, a new messaging app, since last December. In June it introduced IGTV, a YouTube competitor that puts vertically shot videos into their own app.
Instagram continues to add new features to its mobile application, including contact synchronisation with Facebook Messenger and its new status indicators, which allow users to see when their friends are online.