Instagram is pushing to improve the social shopping experience. Recently, they rolled out a beta version of Instagram Checkout and we believe it will be an exciting advancement overall. Shopping and hotspots on Instagram are not new, but Checkout could represent yet another way to leverage user-generated content (UGC) for e-commerce and an important piece to overall social media strategy.
While this functionality is currently only available to a few select brands and there are still questions as to how it will work in practice, the overall concept promises excellent advancement for omnichannel marketing.
How Instagram Checkout Works
Instagram Checkout allows visitors to complete the purchase of products directly from posts on Instagram, in Instagram. In the past, actual transactions would take place outside of the platform.
With this new functionality, posts that are configured for Checkout will appear with a shopping bag icon. Viewers click on the icon to be directed to the Product Details Page and from there they can select “Checkout on Instagram”. They’ll be able to specify their purchase and select options that will include traditional details on the product selection, such as size, color, number of items, etc.
First-time users of Instagram Checkout will also need to enter their payment information, such as name, billing/shipping addresses, and banking. Instagram will save payment information to streamline for future purchases.
Users of Instagram Checkout will be able to track their purchases directly on the Instagram App. They will receive shipping and delivery updates and be able to track past purchases directly from their account.
How Instagram Checkout Changes the Approach to Selling on Instagram
The promise with Instagram Checkout is that it makes the purchase of physical products more seamless and moves the user directly from Instagram post to conversion.
While we predict that Instagram Checkout will be particularly effective for impulse buys and purchasing of less complicated or lower priced items, it shouldn’t be the only method. Social and omnichannel marketing strategies can benefit from offering an Instagram-style experience across other marketing channels that bolster awareness and build brand trust, especially with user-generated content.
When it comes to customer content like user-generated photos and videos that can be used in Instagram Checkout, this content should also be repurposed across other marketing channels. Including UGC throughout e-commerce pages such as the homepage, product pages, reviews, and more can make the online shopping experience more trustworthy and informative by addressing specific pain points with genuine customer experiences. Mixing UGC in with product pictures and including a shoppable social feed that features relevant content on each product page provides visitors with a better understanding of the products and their use in the real world through the lens of other people like them.
Limitations of Instagram Checkout
Currently, Instagram Checkout is in a limited beta phase. If you’re not one of the initial brands already using the feature, you’ll need to wait until it’s more widely available.
Here are some potential limitations for when Instagram Checkout rolls out for wider use:
Only for physical products
Instagram shopping accounts are generally for consumer physical products. If you sell services or more complex products, this will likely not be a useful channel for your social commerce strategy.
Need to acquire rights to UGC
Selling on social channels works especially well when pictures of real users showcase the brands’ products proudly – i.e., UGC. Any posts used in Instagram Checkout need to be owned by the business. So if you’re using UGC, you’ll still need to acquire the rights from the original posters before you use any images to setup your shoppable posts.
Some shoppers will love the option of shopping on Instagram without being directed to another site. Some will not want to have their financial information on yet another app. This is why an omnichannel approach is always best — different users want different experiences.
Controlling the customer journey
Traditionally, you gather analytics through each step of your customer’s journey through your sales funnel. However, if the customer journey takes place on a third party site, you may not have access to all the data. This means you could potentially lose chances to segment, upsell, or retarget customers. Instagram currently says it will provide information on sales for merchants. This is one of those unknown aspects that we’ll need to see in practice to know how it impacts strategy.
Single channel only
We predict that Instagram Checkout will be an excellent addition to your omnichannel strategy, but not a replacement. By integrating UGC based e-commerce across all channels such as your website, brand apps, SooH, and social networks including using Instagram Checkout, you can future proof a brand’s identity and maximize engagement and revenue.
Instagram will charge businesses a fee for each transaction.
Because the Instagram Checkout hasn’t fully launched yet, there are still unknowns about how it will work in practice. Details have not yet emerged, but with new features comes the potential for new API endpoints which means we could see some interesting developments in mixing traditional e-commerce, UGC and shoppable Instagram to create new possibilities. Instagram has already mentioned that you’ll be able to integrate directly or work with partners including Shopify, BigCommerce, ChannelAdvisor, CommerceHub, and more in the future.
As Instagram Checkout continues to be built out and released to a broader audience, it could provide macro and micro influencers with an avenue to build and monetize their own brands. Eventually, we might even see PPC budgets shifting from other channels to push Checkout content.
For consumer brands that sell physical goods, Instagram Checkout looks to be a promising addition to social and e-commerce strategy and we’re excited to work with our customers to mix with UGC and augment their strategies. Social content is true word-of-mouth in the modern era of marketing, but its full impact is only realized when a consistent and stellar buying experience is delivered at every interaction with your user.