As Meta is preparing to begin its “year that is efficient,” Meta announced that it will end its live-streaming shopping feature on Instagram after the same decision on Facebook. From March 16 2023 Instagram consumers will no longer be able to tag items while live streaming -a feature which has been widely accessible in the U.S. to U.S. businesses and creators since the year 2020.
These changes highlight the issues that the U.S. market faced when it comes to making shopping via live stream a success.
Live shopping is already extremely well-liked in Asian markets which include China where apps such as WeChat, Taobao Live, and Douyin (China’s TikTok) have proved that live shopping can be an extremely popular and profitable venture. When the pandemic spread throughout the world, a lot of U.S. businesses looked to take advantage of live shopping, too in order to boost their online retail sales. Soon, the pundits were declaring live shopping to be the “future of e-commerce” due to the early success of businesses such as TalkShopLive, NTWRK, Brandlive, Whatnot, and others in the market popularity, along with adoption by big tech companies such as Meta, Amazon, and YouTube.
However, the pandemic obscured the real picture. While consumers stayed at in their homes, online retailers exploded and sales on e-commerce soared. The dust was gone and the world went back to normal, however, analysts discovered that U.S. consumers had not adopted live shopping. One study noted that social commerce in general including livestream shopping, represented about 5 percent of all retail sales of e-commerce within the U.S. last year, as per Insider Intelligence data.
Then came news that TikTok was touted as a possible live shopping platform has been reducing its live commerce offerings for Europe and the U.S. and Europe as the majority of livestream tests resulted in no sales. (More recently, the company has been believed to be planning another approach to love shopping, but this time together with TalkShopLive.)
It’s possible to be that Western markets’ distinct ways of life and their digital preferences make it difficult to replicate China’s live-commerce success, as it has unsuccessful in creating an equal “super app” which could rival WeChat.
Meta claims that, even though it’s ending for live transactions, the company is investing in shopping, since 90% of customers follow at least one company on the website.
However, instead of promoting live commerce, the platform will instead focus on advertising, which is one of the primary ways that people come across companies and make purchases on Instagram. This includes using its automated tools, such as Shopping ads, and Advantage+ ads aimed at improving the effectiveness of advertisements as it states. The company will continue to invest in checkouts, where customers can purchase an item with just a couple of clicks from Instagram or Facebook Stories, Feed, or Reels.
Despite the promises made, Instagram recently demonstrated it plans to remove shopping from its application. The app made an important change to its navigation system, which was the removal of the Shop tab completely and moving Reels towards the left. These changes were made to address the increasing criticism of users regarding the aggressive Reels push, which stemmed from Instagram’s battle with TikTok. In the past, Instagram head Adam Mosseri admitted that the company had been pushing too many videos, and will seek to reduce the number of videos and images that are displayed. It’s possible that live shopping’s decline is due to this change, also.
Instagram claims that creators will be able to live stream on Instagram However, they can host guests and hold Q&As. Businesses can also manage and set up an online shop on Instagram after the live shopping feature has been shut down.
