The E-commerce sector is growing day by day. Some big guns in the business are Amazon, Alibaba, and JD.com. If we talk about Amazon, this firm led by Jeff Bezos dominates half of the virtual transactions in US. Amazon does 47% of the virtual transactions in US through its online portal.
But the dominance of Amazon gets shaky as Instagram tries to get into this business. Instagram has 1 billion users worldwide, and the number increases daily. If Instagram thinks to enter the e-commerce space it can be a threat to Amazon.
And Adam Mosseri said that Instagram intends to spread its reach to the online commerce. Instagram started off as a photo platform but Adam Mosseri has some other plans for it. In his first public interview after taking over instagram, he shared his vision for Instagram.
He shared to an English daily that he wanted to “connect the dot thoughtfully”. Instagram has shoppers, sellers and also a huge number of influencers. They have all the raw materials and they just need to sort it out and exploit the resource.
Adam Mosseri’s plan is to leave behind the visual aspect of the platform and expand its virtual space. He wants to create an interface where users can not just show images but buy directly from it. Instagram might introduce features like ”shopping cart” and “native checkout” to its application.
A small portion of the world shops online but it is increasing every year. In 2018, sales exceeded $2.86 trillion. And this was a jump of 18% from the previous years.
Firms like Alibaba and JD work in Asia. Their prominent market is the Asian market. But Amazon operates around the world. If Instagram decides to push in this sector then Alibaba and JD will not have much to lose. That is because Instagram as a subsidiary of Facebook is prohibited from operating in the Asian giant.
Its competitor would be Amazon. And Amazon’s dominance will suffer. In March, Instagram launched a direct sales pilot program. And it had limited number of brands, 20 to be specific, included but it was a small step.
Even though the firm plans to take over the E-commerce sector, it needs planning and time. Mosseri said that the firm needs several years to transform itself into a sales venue. It needs to build necessary infrastructure, like striking deals with payment service providers in different parts of the world. But he predicts it is going to take 5-10 years to carve a niche out there.
