With the impetus of the influencer, the gleaming testimonial for brand credibility, Instagram’s role in enriching product discovery and driving purchases was cemented, but uncertainty lies in whether brands and retailers are losing control as their customers gain through in-app shopping.
Now that Instagram is piloting its in-app shopping feature with brands such as Revolve, Nike, Burberry and many others, retailers may be poised to lose — at least some of — their grip on customer shopping data.
WWD spoke with BounceX’s Kris Mobayeni, assistant vice president of marketing, and Ryan Urban, chief executive officer and cofounder, to implore on the viability of social media as a direct purchase stream.
BounceX specializes in device identity resolution, servicing fashion brands such as Hugo Boss, Kate Spade and others to deliver “made for you” personalization messages across devices.
For BounceX, the goal is to “save face” or give faces to customers who crave recognition and personalization, while retailers, on average, see 40 percent of anonymous traffic identified by BounceX’s proprietary technology.
Pointing out overarching technology and consumer shopping trends: “Everything is merging to the 5-inch mobile phone,” said Urban, which justifies the spending power of Instagram with 130 million users engaging with its shopping posts every month, as previously reported in WWD.
Across physical and digital channels, the shopping experience has seen strides in reducing friction, and as Mobayeni sees it native shopping on Instagram is a “big win” for customers.
“The checkout process is one of the biggest points of friction in mobile commerce,” Mobayeni said. He added that dynamic product ads will show an uptick in conversion as retailers encourage the high-intent customer to take that last step in completing a purchase.
In spite of customer gains, Mobayeni foresees a few friction points for retailers. He predicts a hit for retailers’ average order value and complications with seller fees, particularly for those who have thinner margins or are experiencing channel fatigue.
“Regardless of where overall performance nets out, this is just another hit for brands and retailers who are trying to regain ownership of their customer experience and data,” reiterated Mobayeni.
Although sellers will obtain the purchase data from Instagram conversions, crucial behavioral data leading up to the transaction “will now remain within the walled garden.”