Will Instagram click in e-commerce biz?
Following the lack of digital footfalls on its messaging apps Allo and Hangouts,
Google is reportedly planning to discontinue them soon
Social shopping is coming of age in India with Instagram being the latest entrant to join the bandwagon, after Google and Facebook. The photo- and video-sharing app users will be able to shop for products within the app from next year, according to a news report (bit.ly/2zg2nr6).
While users will initially be redirected to a merchant’s web page to complete the purchase, over time, the purchase will be possible within Instagram. According to the company, 90 million accounts on Instagram tap on a shopping post to learn more about products every month (bit.ly/2qbuukv). Further, many fashion designers and lifestyle brands are leveraging the visual nature of Instagram to launch their new products.globally, Instagram allows users to shop through a shopping channel as well. With shoppable posts, customers have even greater opportunity to connect with the brands they want to buy, as they have the ability to see relevant information, such as product description and pricing, with a single click, without ever having to leave the app. The addressable market is also huge with Indian e-commerce likely to grow more than fourfold to $150 billion by 2022, said a Nasscom-pwc report.
However, in a mature e-commerce market dominated by companies, such as Flipkart and Amazon, which control more than 80% of India’s online fashion market and offer deep discounts to consumers, will Instagram be able to hold its own?
According to Sandy Shen, senior director analyst at Gartner Inc., Instagram is trying to monetize the large user base it has in India, which is its secondlargest market. She adds that the success of this initiative will depend “on the number of brands that will participate, the range of products available for purchases, and the overall user experience—whether it is a redirect or in-app purchase”.
However, Shen does not expect this to have a big impact on big fashion e-tailers “as most consumers go to Instagram to socialize rather than shop”. She concludes: “So, the volume of such transactions will be much smaller than that of e-commerce platforms that often appeal to serious shoppers.” Meanwhile, though, online shoppers in India get an additional shopping channel.