Instagram Adds 'Checkout' Feature to Let US Users Shop via App

Facebook Inc's Instagram is trialing a feature that lets U.S. users shop from the photo-sharing app by using a "checkout" option on items tagged for sale, the company said on Tuesday.

The move is in line with Facebook's plan to monetize higher-growth units like Instagram, as its centerpiece News Feed product struggles to generate fresh interest.

Instagram has partnered with more than 20 brands including Adidas, H&M, Kylie Cosmetics and Michael Kors on the shopping feature, easing into territory more familiar to retail giants like Amazon.com Inc and Walmart Inc.

The feature will allow U.S. Instagram users to click on a product featured in a post, see its price, and click again to bring up an order form.

Users can then check out and pay via Visa, Mastercard, American Express, Discover or PayPal. Previously, Instagram allowed brands to link to their respective websites for users to make purchases.

"Facebook's track record on privacy is the bigger issue (that) may negatively affect the launch of in-app purchases," said Gabriella Santaniello, founder of retail research firm A line Partners. "I would expect there to be some reticence when inputting your credit card information upon checkout."

The world's largest social network is under intense pressure to improve its handling of data following a number of controversies related to user privacy on its platform.

Instagram, which did not specify any financial details of its partnerships, said it would introduce a selling fee to help fund transaction-related expenses.

In a similar move last year, image-search platform Pinterest Inc introduced a feature called "Product Pins," to provide prices and links to retailers' checkout pages to make purchases.

Instagram has more than 130 million users tapping to reveal product tags in shopping posts every month, up from 90 million in September, it said.

Facebook has plans to evolve Instagram and Messenger into robust e-commerce platforms where users can click on ads and buy products, said Ivan Feinseth, an analyst with Tigress Financial Partners.

© Thomson Reuters 2019