Checkout with Instagram

The process of buying a product is fraught with fear and risk. Fear of paying too much, fear of buying the wrong product or fear of buying the wrong make. Buying from a well-known and trusted brand reduces this risk, as does peer or celebrity endorsement. The latter two have been well served by social media platforms through ratings and influencers respectively. Until now, Instagram’s commercial process has ended with paid-for advertising; however, last week it announced that it is effectively becoming a retailer, by allowing you to buy featured products within their app. Under the proposals their new commercial model is to take a sales fee from the benefitting brand. Instagram’s advantage is that it is one step downstream towards the consumer relative to most retailers, and is increasingly used as the venue for consumers to find out about brands, rather than traditional methods (e.g. shops). To put this into context, the average Instagram user spends 53 minutes on the platform each day, whereas the average woman spends 40 minutes per day shopping (men: 25 mins). Going forwards, the battleground in retail will be at the front end of the consumer funnel, and shopping centres will increasingly need to compete with social platforms to become the first point of reference for products.