Retailers Are Striking Gold with Instagram

Retailers large and small are striking gold on Instagram. The photo sharing site recently introduced sponsored images. But there is evidence that even businesses using the site for free have been able to generate sales using images of their products.

According to Forbes, Instagram is even handily beating Pinterest in terms of user engagement and number of daily users.

It’s interesting how the Web has evolved over the years. In the 1990′s, the place to sell was eBay. Then it was Amazon. Now, it’s a photo sharing site of 150 million users that wasn’t even designed to be an eCommerce platform in the first place. Add in 250 million shared photos a day, Twitter-style hashtags and tags, and you have a platform on which small business owners are making a serious amount of money.

Boutiques like New York City’s Fox and Fawn are using the community to promote their wares. Big Luxury brands like Coach have seen a reported 5 to 7 percent increase in conversion. Add to that a 2 percent increase in the value of the average order from their online store. All of this was the result of simply asking customers to take photos of themselves with their favorite brand apparel.

To give you an idea of how powerful Instagram is for online retailers, at Fox and Fawn, items often sell out within minutes of the picture being posted on Instagram. Customers often keep their credit card number on file with the shop to make the selling process faster.

There’s also the case of Daniel Arnold, who had $90 to his name and no way to pay the rent one month. So he went to his Instagram account and told his 28,500 followers that his photos were for sale at $150 a pop. He ended up making $15,000 in one day – and the orders haven’t stopped coming.

Jenna Wortham at the New York Times gives us a personal impression of why Instagram may be so popular for small business owners to showcase their wares:

“Instagram isn’t designed to be an eCommerce site, and that’s part of its appeal to me. Internet giants like Amazon have finely calibrated algorithms that suggest items and services before I even think of them, and they are very useful. But there is something undeniably charming about flicking through photographs that are carefully curated and personally posted by some Instagram sellers, who regularly offer one-of-a-kind treasures.”

Scott Galloway, professor of marketing at New York University’s Stern School of Business put it even more simply:

“We absorb visual information 50 times faster than text. Visuals go right to our heart.”

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Mark O'Neill - Staff Writer


Mark O'Neill Mark O'Neill is a staff writer for Small Business Trends, covering software and social media. He is a freelance journalist who has been writing for over 25 years, and has successfully made the leap from newspapers and radio onto the Internet. From 2007-2013, he was the Managing Editor of MakeUseOf.com.

10 Reactions

  1. Wow. That quote hit me. It’s true. For some reason, visuals have a different effect on us. It is subtle yet it pushes us to make an action. Although I am not against selling on Instagram as you still have a choice to create another profile to follow all those online stores and have a personal account if you want.

  2. The old “a picture paints a thousand words” is never more relevant than here.

  3. How do the retailers incorporate Instagram with their online shop and brick and mortar store activities?

    • They make Instagram accounts, take photos of the merchandise, and encourage Instagram users to follow the business and make orders when they see a photo of something they want to have. The article above describes it all.

      • Mark,

        I read your article (post), that is why I asked the question regarding the action step from viewing an Instagram photo to the purchase! ;)

        If you embed the Instagram photos into your web store and link them together, I can see the step by step process.

        Facebook must be happy with the purchase of Instagram! :)

      • Martin

        You don’t really need to embed the images into your web store. You can just maintain your Instagram page (every account has its own unique URL), and you can encourage customers to keep a watch on the page (of course link to it via your website as well).

        The retailer in my post encouraged regular customers to keep their credit card numbers on file with her, so when they found something on the Instagram page, they could be billed immediately.

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