Instagram is Scaling Back on eCommerce Initiatives - What Does it Mean for Social Commerce?
Meta recently announced that it will scale back its eCommerce capabilities on Instagram (The Information). This means reducing the specific shopping section within Instagram. Overall, it’s a retrenching for Facebook into the core of their business and revenue generation, which has always been…advertising! They are investing heavily (or bleeding money depending on your point of view) into what they see as the future of their business, the Metaverse. So Meta simply doesn’t have the ability to invest as it once did in various other ventures. They are choosing their lanes and those lanes are ads and the Metaverse. Instagram will still maintain many of its shopping features, especially those that are tied to advertising revenue (like shoppable posts, for example).
But what does this mean for brands who use Instagram as an eCommerce platform?
Social commerce is forecasted to grow by 26% year over year and triple by 2025 to $1.5 Trillion (Accenture). Facebook and Instagram are still massive forces of influence for shopping and commerce. Influencer spending is forecasted to reach $4 Billion in 2022 (Insider Intelligence). Brands can’t ignore this as a channel to educate and engage with their audience. According to a study done by Oracle, consumers are 37% more likely to trust influencers over brands themselves. Instagram has a massive reach for brands. In fact, Instagram has 2 Billion monthly active users, which is still twice as many as TikTok.
So brands need to stay focused on creating content and engaging with consumers in a way that reduces friction for them. That means leveraging the shopping tools that are available for those consumers who want to buy. That doesn’t always mean utilizing every social channel available, but it does mean strategically leveraging social media and the right channels. Test, and experiment, but don’t make assumptions about what will work without a proper test and quality built content.
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