From taking pictures to selling - how Instagram is evolving towards e-commerce

Instagram is getting down to business. For years, the platform founded in the USA in 2010 was the source of inspiration for an entire generation. But it could soon be much more: In the background, Instagram is building a huge e-commerce platform. A few weeks ago, the option was activated to add a product tag to posts. A simple click takes you directly to the provider's online shop where you can buy the product. Instagram is currently even testing a payment system to allow purchases to be made directly without leaving the app. But first things first. We show you how it works:

Using product tags

Once product tagging is set up, products that appear on Instagram posts can be marked. Once set up, this process is as easy as marking a user.
If a user likes the post, he can tap on the picture and the "Tag" appears. The tag shows the article together with the price. A click on the link takes the user directly to the online shop on his/her mobile.

Prerequisite 1: Online shop

The easiest way is if you already run your own online shop. For example, with Shopify. Shopify is an online web platform that already includes all major e-commerce functionalities. But it also works with Woo Commerce, Etsy and even Magento.

Not everything can be sold: It must be a physical product. Digital products and services are not (yet) permitted.

Prerequisite 2: Product catalogue on Facebook

Before getting started with Instagram, you need to set up a Facebook business account and add products through the Facebook catalogue. The business account makes it possible to sell products directly on the Facebook page.

How does that work?

This is done via the Facebook business page by clicking on the shop button. By following the appropriate steps, you can connect your e-commerce software to Facebook.

Once the product catalogue is created and linked on Facebook, Instagram product tagging can also be set up. 

To make the product tagging on Instagram work, the following additional steps are necessary:

Step 1 - Activate product labelling. This is done via the Instagram settings. Scroll down and tap on Products to activate the product label.

Step 2 - Authenticate your Facebook Business account to connect your Instagram business profile to the Facebook product catalogue.

Step 3 - Select the Facebook catalogue associated with the Instagram business account.

From this point on, it will be possible to mark products on every post.

Pay directly in the app?

The payment function in Instagram is already being tested in the USA. The user enters his credit card directly in the app, specifies the usual security features and can then shop directly in the Instagram app. Services such as concert tickets and table reservations will be added at a later date. One provider that already offers tickets via Instagram is Fandango - an American ticketing company that sells cinema tickets via its website and mobile app.

Instagram e-commerce

This is what the payment function on Instagram might look like one day. (Picture from a blog post by Instagram, March 2017)


For companies and brands, the social media strategy and its constant adaptation to the development of social networks is becoming increasingly important. The following three building blocks will be essential for future social media success:

  1. Analysis of the target groups' movements and their behaviour with regard to the new e-commerce solutions from California as well as adaptation of the content and media strategy.
  2. Technical and mechanical orientation about the new developments.
  3. Focus on the essentials and the defined KPIs (less is more!). Something bigger might be emerging here. The new e-commerce functions could greatly increase revenue per user in the future if the community reacts positively to the new functions and uses them. Which is to be assumed.