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Here’s Instagram’s Latest Move to Increase Its Revenue


Mar. 21 2019, Published 1:54 p.m. ET

Instagram’s new in-app shopping feature

Facebook (FB) is making it easier for users to buy products they like that they see on its platforms. Instagram is leveraging its popularity among consumer-oriented brands, which have preferred to advertise their products on the photo-sharing app.

Now, when users come across a product they like on the app, they will have the option of buying it without leaving the app. Instagram will keep a small cut of such transactions. Initially, the option will be available only for select brands.

All the user has to do is click on the product to see the price and click again to bring up an order form and check out using a credit card or PayPal.

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New feature will help boost revenue

Instagram, which said that it had over 1 billion monthly active users last year, will be an attractive marketplace for brands that covet the young, fashion-savvy demographic Instagram boasts.

Even though the company will be charging only a nominal fee, it will definitely boost its revenue. It’s also possible that Instagram will allow brands to promote their shopping posts, which could be another source of revenue for it. The new in-app checkout feature could also help the company retain users in the long term.

Facebook stock rose 0.6% on March 19, when Instagram launched this initiative.


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