Instagram expands shopping features to take on Amazon

Shopping on Instagram is about to become an even bigger business. 

The company just announced two important updates to its growing e-commerce business: shoppable ads in Stories, which it first started began testing in June, will launch globally, and Instagram’s Explore tab will get dedicated shopping channels. 

The update means brands and businesses will have significantly more ways to get their products in front of users. Unlike typical Stories ads, shoppable ads (pictured below) can contain stickers that link directly to specific products. Previously only available to a limited number of early partners, the feature is now available to businesses in 46 countries. 

Separately, the new shopping channels in the Explore tab will appear alongside Instagram’s other personalized topic channels and will surface a mix products based on your interests, according to the company.

The updates mark a significant expansion of Instagram’s shopping features, an area that’s becoming increasingly important to Instagram. While it’s not clear, for now, just how big of a business e-commerce actually is for Instagram, though the company obviously sees it as a huge opportunity. 

During Facebook’s last earnings call Sheryl Sandberg noted that Instagram has more than 25 million business profiles on its service, a number that’s likely to keep growing as the app leans further into shopping. The company may even be working on a standalone shopping app, according to a recent report from The Verge.

What is clear is that Instagram has emerged as a critical platform for many smaller and direct-to-consumer businesses, which depend on the photo sharing app to reach new customers. 

“It’s one of the fastest growing channels that we’ve had in terms of merchant interest,” says  Satish Kanwar, VP of Product at Shopify. Shopify’s e-commerce platform, which is used by many companies which are active on Instagram, was one of Instagram’s first partners on shoppable Story ads earlier this year. 

For Instagram, investing in shopping features is beneficial for more than just commanding new ad dollars. It also gives brands and businesses yet another reason to go all-in on the platform. The app, which counts more than a billion users and may be worth as much as $100 billion, has, until recently, put its consumer-facing features first. But, given its explosive growth over the last couple years, the company is now looking for new ways to get all those users to engage with businesses, particularly small businesses. 

If the strategy works, then Instagram could become not just a social media powerhouse but an actual Amazon competitor.