Social media platforms are being slimmed down, and e-commerce functions may be removed

Just over two years after Instagram launched its Shop feature , the social media platform has announced it will remove the feature from its homepage.

In a statement released two days ago , Instagram said that starting in February, the Shop option will disappear from the Feed and be replaced by the Reels option, and the New Post button will move to where Reels used to be .

According to an Instagram spokesperson , “ People will still be able to open and operate their own shops on Instagram as the platform continues to invest in the shopping experience . ”

But a report from The Information suggests that in the coming months, Instagram will further reduce its investment in store features . In the future, Instagram will prioritize its advertising business rather than e-commerce features .

It is understood that the Instagram Shop feature was originally launched in 2020, when the epidemic was at its worst and the overall e-commerce industry was on the rise . Adam Mosseri, head of Instagram, said at the time that e-commerce would be the future of Instagram.

But over the past two years, Instagram e-commerce has not grown as fast as the company had hoped . While big brands like Ray-Ban, Victoria's Secret and Anthropologie regularly promote their stores on Instagram and update their product catalogs regularly, the feature is still dominated by smaller brands and individual sellers .

Because big brands prefer to sell through their own online channels, they want more control over sales data . A survey conducted by Hubpot in April 2022 found that brands' sales data on Instagram stores is very scarce compared to their own channels . In addition, the 5% handling fee charged by the platform for each order has long been a complaint of sellers .

“Meta has a ton of data on its app that allows it to see how users engage with the platform for commerce, and the shop button was probably removed because it was underutilized,” said Randy Nelson, senior director at data firm Data.ai. “ This slimming down is critical for Instagram , whose leadership has expressed its intent to revamp the app to make it faster and more intuitive for users to share content.”

Jane , an online boutique with more than $1 billion in annual sales, has been using Instagram ’s Shop feature extensively since CEO Talib Nurmohad took over in 2020 .

But Nurmohad said: " He sees Instagram primarily as a customer discovery tool because most people don't come to Instagram to shop . "

For big brands like Jane, Instagram Shops is just a marketing channel , and Instagram's strategic transformation is not expected to have an impact on them . However, some individual sellers and small sellers like Soludos who rely on Instagram Shops for their main income may need to make strategic adjustments.

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