Brief:

• Instagram quietly added a native payments feature to its app to let users store their credit card information and make purchases directly inside the app instead of being pointed to another website, according to TechCrunch. A spokesperson confirmed to TechCrunch that native payments for booking appointments at restaurants or salons are now live for a limited group of businesses on the Facebook-owned app that has more than 800 million users worldwide.
• Resy, the online restaurant reservation service, is one of the first companies to partner with Instagram for booking. Instagram plans to add direct payments for other services like movie tickets in the future. Some U.S. users can enable the feature in their app settings, register a debit or credit card and set up a security PIN as part of their Instagram profile.
• The app in 2016 first tested shopping features with brands like Kate Spade, JackThreads and Warby Parker before rolling out the service more broadly last year. Its shoppable tags let businesses mark products in posts that are available for purchase on mobile commerce sites. Instagram expanded those shopping services globally in March.

Insight:

Instagram's test of native payments is the latest step in the app's advancement toward e-commerce. Brands and social influencers already post photos of products on the site, making the mobile app a key way for consumers to discover new products.

Last year, Instagram rolled out shoppable pins to let brands add product information and links to buy those items on their website. The new payments feature may remove the extra step of linking to an external website and instead let users browse and buy items without ever leaving the Instagram app. If in-app payments are added to a wider variety of products, marketers would be able to reduce the friction between seeing a product and buying it. The possibility to drive impulse purchases may urge more brands to promote products on Instagram, a social platform that plays an important role in the early phases along the path to purchase as a discovery and research tool. With new in-app payment features, Instagram could see its role in the purchasing journey shift into more of a one-stop-shop for product discovery and buying.

This comes as social commerce is beginning to ramp up. Though still in its infancy, some marketers have seen success in selling products directly to consumers via social apps. Snapchat in February tested in-app transactions by opening an online store that featured company-branded merchandise. Later that month, Nike ran a sneaker promotion on the platform that sold out in 23 minutes. Snapchat in April began tests of an e-commerce function in some Discover publisher channels and recently unveiled a feature that lets brands merge e-commerce with augmented reality (AR). Just over half of consumers said they've made purchases through social media channels like Snapchat, Instagram and Facebook, according to an Avionos study. This points to potential growth in the space as consumers' become increasingly interested in buying products on the same platform on which they browse, removing an extra step and streamlining the purchasing process.