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Memes Are Great, But Instagram Really Wants You to Shop

TikTok, look out. Instagram has just debuted shopping capabilities within its recently launched Reels feature as part of the social media platform’s redesign. Within the “Shop” tab, which was first teased in the summer when parent company Facebook launched a “Shops” feature of its own for businesses of all sizes, consumers can find personalized recommendations from creators, editors’ curated picks, shoppable videos and new product collections.

With the launch, both businesses and creators will be able to tag products when they create their own Reels, which are 15-second multi-clip videos that anyone with an Instagram account can upload, share and edit with audio, effects and other creative tools.

Instagram first confirmed the launch of both the Reels and Shop tabs in November, but Shop wasn’t officially activated until Dec. 10. Facebook did not immediately respond to a request for comment.

With the new tab, Instagram gives consumers the ability to shop from videos in Feed, Stories, Live, IGTV and, with this latest launch, Reels. As part of the overall app redesign, buttons for Reels and Shop were added to the bottom of the front page, replacing the Compose and Activity buttons.

The official bundling of Reels and Shop comes shortly after TikTok entered a partnership with Shopify, giving TikTok a channel on Shopify Channels and more importantly offering the e-commerce giant’s 1 million merchants an opportunity to capitalize on viral content and reach younger audiences. More specifically, the TikTok channel will allow merchants to create and connect their TikTok For Business account and deploy In-Feed shoppable video ads directly within Shopify, so that consumers can buy products that they see being used or worn in the videos.

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Instagram says many Reels already feature shopping content, including fashion looks, makeup and skincare, or other product how-to guides. When people view an Instagram Reel with this content, they’ll be able to now tap a “View Products” button to either buy, save or learn more about the featured products.

Influencers using the platform can add a “Branded Content” tag to their Reels to be transparent about when they’re working with a brand to promote their products, which is a form of paid promotion.

Instagram stands to benefit from the new revenue stream, given that its primary money driver, like  Facebook, remains advertising. With commerce now prioritized across the app, Instagram now has the chance to make money on the sales fees from each transaction.

The app, which used to be known more for its sharing of images, and later on, videos via its Stories function, has made a concerted effort to become more of a commerce player, with its first big move come last year in March with the it launch of Instagram Checkout for brands including Adidas, Burberry, Michael Kors, Revolve and Zara.

The feature, designed so that consumers could view items on Instagram and purchase them without having to navigate away to a brand’s website to complete the transaction, opened up to all eligible U.S. businesses in August to get the Shop feature off the ground.

On the whole, social commerce has had a tough time breaking out as a bona fide sales driver for brands despite continued tests over the past few years. In April, 45 percent of shoppers told Bazaarvoice they had purchased a product through a social media platform, while 41 percent had purchased a product an influencer had recommended. But even then, the channel has never appeared to gain consistent traction as more than a discovery vehicle for shoppers.

With the integration of shopping tabs directly into videos, both Instagram and TikTok are hoping this could be the breakthrough necessary for real commerce growth on social platforms.

Beyond the potential success of the Shop and Reels features, Instagram now faces news questions in the wake of Facebook’s upcoming fight with the U.S. government.

On Dec. 9, the Federal Trade Commission (FTC) alongside 46 U.S. states sued Facebook for alleged antitrust violations and anticompetitive behavior. In particular, the FTC is seeking a permanent injunction in federal court that could, among other things, require the company to divest assets, including Instagram and popular messaging application WhatsApp, effectively breaking up Facebook as we know it.

While antitrust lawsuits typically take years to deliver any sort of serious consequence for defendants, meaning that Instagram’s functionalities are unlikely to see any legally enforced changes in the short term, Facebook now has the government looking over its shoulder at any expansive moves it makes across its wide-reaching enterprise.

Facebook’s acquiring $1 billion acquisition of CRM platform Kustomer might also attract scrutiny. The companies already had an existing relationship, with Kustomer’s offerings allowing companies to aggregate and respond to customer inquiries that come in through Facebook Messenger, and as of October, Instagram’s own messaging platform.

Alongside the acquisition, the social media giant also updated its Messenger API to allow businesses to manage their communications across Instagram. The update means retailers can now also integrate Instagram messaging into the applications and workflows they’re already using in-house to manage their Facebook conversations.