On Instagram, ecommerce has entered the chat

There's a new way for Instagram users to make an online purchase: Sliding into brands' DMs.

The news: Parent company Meta on Monday announced new features that allow Instagram users to order an item within a direct message on the platform. This includes capabilities to communicate with businesses about products and make a purchase directly from them. It all happens without leaving the chat.

How it works: In line with an ecommerce purchase flow, Instagram laid out three parts of the in-direct message process:

• Communicate with brands and businesses: Users can request information about an item, including chatting about customizations. This enables businesses to confirm product details, Instagram says.
• Place an order: Once a user decides they want to buy, businesses will be able to create a payment request with a product description and price. Users will be able to order the item from the business, and complete checkout using Meta Pay.
• Post-purchase: Instagram will also allow tracking of orders, and enable users to ask follow-up questions.
• The fine print: The feature is only available to businesses who set up their digital storefront.

Key stat: Meta says one billion people send messages to businesses across its apps each week. “We want to help people start conversations with businesses they care about and help them find and buy products they love in an easy, seamless experience, right from the chat thread,” the company said.

Social commerce on Instagram, a brief history: Instagram has long been an important channel for brands to reach consumers, as its photo-centered format provided an opportunity to show off their products via partnerships with influencers. More recently, Instagram has been rolling out features that enable users to connect directly with brands and make purchases from them within the app. These social commerce product releases have included:

• Shopping Stickers: When Instagram debuted Stories, shopping became a part of the feature in 2018 in the form of stickers that allowed users to tap for more details about a product.
• Checkout: In 2019, Instagram introduced tools that enabled users to make a purchase without leaving the app.
• Shops on Instagram: In 2020, Instagram rolled out full-screen storefronts where brands could present products, as well as tell their stories. This was an upgrade to a shopping feature that Instagram initially experimented with in 2016, in which brands could add shoppable photo tags.
• Going live: With a shop up and running, Instagram then rolled out additional features for brands to reach users. This included the capability to create a collection of products to be featured in live shopping events and Drops to showcase new releases. It also added a “view product” button to Reels that allowed shopping in its short-form video content.
• Product tagging for all: Earlier in 2022, Instagram opened up product tagging that was long available to brands and creators to anyone using the platform.

Where do DMs fit? It’s the latest example of how Instagram is bringing shopping to each facet of the platform. There are many different ways that brands can encourage shopping on Instagram, and this adds a new surface to the mix. Direct messages have long been a way to connect one-to-one with users for marketing. Now, they're a place to finalize a purchase, as well.

What does it mean for the development of social commerce? One school of thought on social commerce is that it will mean enabling the full range of activities associated with an ecommerce purchase to happen within a social media platform. Many of the existing functionalities on Instagram are centered around inspiring discovery of a brand or its products. At the same time, businesses already use direct messages to communicate with customers. With the new in-chat purchasing, Instagram is offering a way to complete a purchase and track an order through a feature that is core to the app.

One more thing: Reading through Instagram’s announcement today, one dichotomy comes to mind with the new features: While payments and order tracking can be automated, answering user questions pre- and post-purchase are likely the domain of humans. In fact, it makes a DM the venue for many customer service functions. That could make it an important site for customer experience. In some cases, brands and retailers have introduced chatbots for some of this work. Will they introduce automation on Instagram, and does Instagram have an integration to allow it?

They’ve got company: Instagram isn’t alone in its efforts to expand social commerce this year. The other big photo-centered social platforms are making moves, too. Snapchat is expanding augmented reality capabilities that are centered on browsing and buying products, while Pinterest recently signaled a big ecommerce push with the acquisition of personalized shopping app The YES, new features and the hiring of Google’s former commerce chief as CEO. Meanwhile, Twitter announced a partnership with Shopify to bolster its own Shops feature, and many brands are finding success reaching customers on TikTok.

The bottom line: The social platforms are all centering shopping as they seek to adopt the lessons of the pandemic ecommerce boom for the long haul and seek new ways to grow revenue as digital advertising becomes more difficult amid privacy-oriented challenges. Plus, it's projected to be a $1.2 trillion market. Still, no platform has cracked social commerce yet. Each new feature is an experiment on the road to finding what resonates.