Instagram is coming after Amazon with plans to launch a standalone shopping app

  • Instagram is working on a new standalone app focussed on shopping, reports The Verge.

  • It would allow people to buy products directly from retailers they follow on Instagram.

  • Amazon has shown third-party sellers can be a huge source of revenue.

Instagram is developing a new standalone app focussed on shopping, The Verge reported on Wednesday, citing people familiar with the matter.

The app would allow users to purchase directly from retailers they follow on Instagram. The current Instagram app started testing a shopping feature, which allows retailers to tag specific products in photos in November 2016, and it rolled out more widely in March 2017.

It is not certain when this new app, which could be called IG Shopping, might launch. As with all apps still in development, there's always a chance it could be killed before it ever makes it to market, but the Verge spoke to anonymous sources who said that Instagram feels it's well-positioned to make the move into e-commerce.

Another source familiar with the company’s thinking, told the website that Instagram could introduce enough tools and features for retailers over time to challenge other dedicated e-commerce platforms such as Shopify. They also said most retailers already have Instagram accounts, so theoretically they would be inclined to use paid business tools if they became available.

The set-up would not be dissimilar to Amazon, which provides a platform for third-party sellers. It's an important part of Amazon's income, generating $9.7 billion of revenue in the second-quarter of 2018, up 40% year-on-year.

Nike is the retailer with the biggest single Instagram account, according to Social Blade, with over 80 million followers. Second is Victoria's Secret, which has almost 61 million followers.

Business Insider contacted Instagram to confirm whether the app is in development.

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