The Instagram Shop: The Case for Ecommerce Diversification and Tech Major Dismantling

The Verge recently reported rumours that Facebook is building a standalone Instagram app for shopping. Whilst this news is as yet unconfirmed by Instagram, it would seem a logical next step given Facebook’s recent innovations to evolve the current Instagram product into a seamless site for ecommerce.

Why small premium brands need an Instagram shop

Amazon has transformed the fortunes of small and medium-sized companies by building an efficient global ecommerce platform within which they can market and sell their products. However, the Amazon platform is less effective for small premium retailers, as they’re not positioned to competitively market themselves via Amazon’s search tools. Even larger premium retailers – which can rely on their established and searchable brand name – have traditionally been wary of Amazon’s functional feel (though some recent signs suggest that Nike is changing its position towards Amazon).

Rather than engage with Amazon, these smaller brands build their own bespoke ecommerce sites or sell via alternative online retailers like Farfetch (so long as their products are selected). An Instagram shop would offer them an equally efficient payment system, but a far superior marketing machine for their specific needs.

Why consumers need an Instagram shop

Instagram has already begun to change the fortunes of retailers whose products flourish in its image-orientated world. Fashion, homeware, beauty and lifestyle brands have built entire – and in some cases lucrative – businesses via the visual storytelling mechanics that Instagram offers.

A dedicated Instagram shop that integrates payments within the app – assuming this is what it would do (Instagram has been testing the feature this year) – would offer consumers of these brands a seamless way to shop, and support, their favourite small brands with ease.

Why an Instagram shop will mean the tech majors need dismantling

The potential plus points for smaller brands and consumers should Instagram successfully launch a shop, will however reinforce an increasingly persistent theme in the narratives surrounding the continued growth of the tech majors: that they are now so big and spread across such a wide range of digital activitiy, that they need dismantling.

Amazon’s dominance across web services, ecommerce and video content is drawing increasing questioning, much in the same way that Facebook’s expansion across monetised messaging apps, digital advertising and now, perhaps, ecommerce too, has.

However beneficial Instagram shopping may be to further decentralising monetisation amongst smaller brands and creators, a healthily competitive and properly regulated tech ecosystem at large, will increasingly be perceived as a prerequisite for consumers and brands alike to flourish within.


Tagged in: Advertising, Amazon, Brands, Competition, Ecommerce, Instagram, Mobile Apps

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