Facebook's (META 2.24%) Instagram subsidiary is pushing full speed ahead in pursuit of its e-commerce ambitions. The popular photo- and video-sharing service is reportedly working on a stand-alone IG Shopping app, and continues to build out core e-commerce functionalities that allow users to buy something directly within the platform. The visual format of Instagram lends itself incredibly well to product ads, which in some cases don't even look like ads and blend in seamlessly with the travel or food pictures that often fill users' content feeds.
The company is now rolling out two features geared toward e-commerce.
Two more e-commerce features
Instagram first started testing out Shopping in Stories in June, and the company announced today that it is rolling out the feature more broadly. Over 90 million people tap on shopping tags within Instagram posts every month, according to the company. That suggests that roughly 9% of its 1 billion monthly active users (MAUs) express interest in shopping on the platform, while Stories remains incredibly popular, with over 400 daily active users (DAUs) of that feature alone.
The company also notes that a third of the most-viewed Stories come from business accounts, highlighting how much reach a company can achieve with the platform. There are now 25 million business profiles on Instagram, of which 2 million are also active advertisers. Instagram also says that 42% of women on the platform are interested in shopping, according to a survey it conducted earlier this year.
Additionally, Instagram is adding a shopping section to its Explore tab. Over 200 million users visit the Explore tab on a daily basis, according to the company. The new shopping category is still in the testing phase, but is expected to deploy globally within a matter of weeks.
Diversifying revenue streams
Slowly but surely, Facebook continues taking concrete steps toward turning Instagram into a vibrant e-commerce platform. The social networking giant never really tried in earnest to add e-commerce to its core platform -- not including Marketplace, which is more of a classified posting service -- but now recognizes how much potential Instagram has for e-commerce.
Instagram was recently valued at over $100 billion by Bloomberg Intelligence, and it expects Instagram's trailing-12-month (TTM) revenue to cross the $10 billion threshold soon. That makes it a huge win for Facebook, representing a 140-fold return on its acquisition price. The subsidiary continues to enjoy rapid growth, which will only accelerate as it explores new revenue opportunities beyond just advertising.