On August 26, Instagram Checkout was made available to all eligible businesses and creators in the US. The Checkout feature allows anyone to purchase products in the Instagram app in just a few clicks. Perhaps the best way to drive more conversion, this streamlined 2-tap process can turn curious browsers into customers right away. Checkout arrived in response to a consumer shift toward using mobile devices to discover and purchase products.
Nike, Adidas, H&M and Zara were among the 23 brands to partner for Checkout on Instagram's U.S. launch back in March 2019, pointing to how these companies and the Facebook-owned app are looking to drive direct sales and capitalize on Instagram's massive user base. Now that this feature is officially rolled to anyone who is eligible to sell on the platform, this is inevitably a major game changer for e-commerce shops and influencers alike as this move fuses together both e-commerce and marketing to, ideally, produce an all-in-one social media platform.
What Does This Mean for E-Commerce and Retailers?
Though just nine months old, Checkout has already helped some brands post tangible results. Adidas CEO Kasper Rorsted said in a May conference call that the athletic wear brand's 40% year-over-year jump in online sales is largely attributed to Instagram's direct-selling features. Checkout could become a powerful revenue driver for Instagram. Though still relatively new, the feature marks a significant push by the social media giant to compete more directly with e-commerce behemoth Amazon, which is chipping away an increasingly larger share of the digital advertising space dominated by Facebook and Google. “If the [in-app Checkout] feature rolls out to everybody, it will have some level of success. Consumers will get more used to it and [brands will] see a bigger lift happen. Brands won’t necessarily replace [their] own e-commerce channels with Instagram Checkout, but it will be another meaningful way to convert,” said Gardner.
Adidas has seen a major sales boost from Instagram’s ‘Checkout’ feature. The sportswear company is one of 20 brands that have been participating in a beta test of the feature since March. ‘Checkout from Instagram’ lets users shop for products, purchase them, and track their shipment directly from the app. Instagram charges participating brands a selling fee, which is primarily to cover refunds and shipping costs. (Details of how much brands pay haven’t been released publicly.)
That fee is apparently well worth it, considering Adidas has seen a 40% jump in first quarter online sales year over year, Digiday reports. (That’s compared to a 24% growth from the third quarter of 2018 to the fourth quarter of 2018.)
Overall, including online and offline sales, Adidas brought in a total of $6.57 billion in Q1 2019, with a net profit of about $707 million — a 17% increase in net profit from last quarter, per CNBC. Adidas’ CEO, Kasper Rorsted, revealed these figures in an earnings call last week, and said that the upswing in online sales is largely due to Instagram. “There was no doubt that Instagram had a positive impact for our online business in the first quarter,” he said. “Product launches and Instagram’s Checkout tool were the two most important things for our online sales business in the first quarter.”
Build Your Instagram Exposure Before Using Checkout
Though this feature solves the problem of driving conversion rates, the precedent must be that your brand must already have enough traffic on its page in order to capitalize on this Checkout tool. It is critical that brands focus on generating authentic content for their social channels and reach a high enough traffic volume before making the shift over to Instagram Checkout. Lifo is able to help you and your brand with this step and get your social channels on board so that they can sustain and successfully support the Instagram Checkout feature.
With Instagram boasting tons of new features and tools seemingly rolled out at the minute, this method of e-commerce is growing to be especially appealing. If your brand is ready to take on this new platform, here are a couple things to consider:
Try out different formats to make your content more interesting
Make the shopping experience part of your Instagram presence
Highlight new products but don’t get too promotional
Involve shopping tags in storytelling
Use Stories to build a narrative
No longer do you have to refer customers to an external page or link anymore. Instagram Checkout is available to everyone and streamlines the process down to mere clicks. A look at the testimonials should show you all you need to know. Join them today and witness a whole new side to streamlined marketing and e-commerce like never before.
Make the most out of these new features and witness ROI growth and brand exposure like never before with Lifo. Lifo leverages advanced AI and technology to help you run influencer campaigns at scale – searching, collaborating and tracking, so that you can grow your brand and business rapidly and effortlessly.
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