Dive Brief:

• Changing the way consumers access commerce on its app, Meta-owned Instagram will remove its Shop tab from the homepage navigation bar in February, according to a post on the company’s support site. A Meta spokesperson told Retail Dive via email that “there will no longer be a dedicated shopping destination. However, people will be able to continue to shop in the moment across feed, reels, stories, explore, and ads.”
• Instagram said the navigation bar update — which also includes moving the content creation button to the center — is part of an effort to “make it easier for people to share and connect with their friends and interests,” per the support post.
• While the Shop tab will be removed, the social media company said businesses will still be able to set up their shop on the Instagram app, and it continues to invest in shopping experiences. 

Dive Insight:

Months after The Information reported that Instagram told internal employees its shopping page would eventually disappear, the company is formally acting on it. The company had reportedly told employees in a September memo that it had a shift in priorities and would test a less personalized version of the shopping page.

When asked about the reporting at the time, a Meta spokesperson told Retail Dive via email that “commerce remains important for Instagram as we continue to make it easier for people to discover and shop products throughout the app from feed, stories, reels and innovations like live shopping and drops.”

Head of Instagram Adam Mosseri said in a video Monday that the new navigation is meant to simplify the app experience, adding “we’re trying to bring people together over what they love.”

During 2022, Instagram had a plethora of announcements related to social commerce. The social media company expanded product tagging capabilities to all users in April, and celebrated Shop’s anniversary with an in-person pop-up event in May. Additionally, Instagram launched a pay-in-chat feature aimed at helping small businesses finalize transactions through direct messaging in July. 

However, Meta’s Facebook platform shut down its live shopping feature in August, stating that consumers' behavior patterns were favoring short-form videos such as Reels. 

The Shop tab on Instagram brought in additional ad potential, with the company in August of 2021 expanding advertisement capability on the feature globally after testing it with select brands in the U.S. for a few weeks. 

As Meta finds its footing in the social commerce space, some data suggests the channel could grow faster than e-commerce overall. An Accenture report from January 2022 forecasts the global social commerce industry could grow three times as fast as e-commerce, from $492 billion in 2021 to $1.2 trillion by 2025. Gen Z and millennial consumers are predicted to lead growth, according to Accenture, which found those generations would account for 62% of global social commerce spend by 2025.