[Playbook] How Instagram DM Automation Powers Smarter Social Commerce

Retailers and e-commerce businesses know that Instagram is where their customers are. 83% of Instagram users discover new products in the app, and 80% make purchase decisions right on Instagram.

Consumers on Instagram now increasingly turn to conversational commerce to help make those purchase decisions. They want to engage with brands in a privacy-safe way via messaging. To learn more about brands, their offers, and to conveniently get answers to questions.

Embracing conversational commerce is a huge opportunity for brands to drive engagement and revenue.

The key takeaways:

The importance of Instagram to today’s purchase journey
The rise of private messaging on Instagram
How messaging automation improves customer experience
Why personalization matters for customer experience
The need to generate zero-party data in a privacy-first world
Conversational commerce use cases for brands on Instagram

Download the playbook

Retailers and e-commerce businesses know that Instagram is an important platform for their marketing efforts. But brands are underestimating one particular component of their social media strategy:

The power of the Instagram Direct Message inbox.

Consumers increasingly want to engage with brands in a privacy-centric manner via messenger tools to learn more about brands, their offers, and to get answers to questions about products and services in a convenient way. Brands, who have relegated the Instagram Direct Message inbox to social care in the past, can instead use Instagram Direct Message automation to proactively engage users — helping multiply organic engagement, drive new customer acquisition, and support personalization strategies that improve the customer experience.

Embracing conversational commerce for Instagram Direct Messages is a huge opportunity for brands to drive both engagement and revenue.

This playbook will discuss:

The importance of Instagram to today’s consumers
The rise of private messaging on Instagram
Using messaging automation to improve the customer experience
The significance of personalization to customer experience
The need to generate zero-party data in a privacy-first world
Conversational commerce use cases for brands on Instagram

Increasingly, Instagram is where shoppers discover new products and make purchase decisions. Eighty-three percent of Instagram users discover products or services in the app, and 80% decide whether to buy right on Instagram. From scrolling through their feeds to watching stories, engaging with influencers, or perusing Instagram Shops, there are many ways consumers encounter and interact with content and products from their favorite brands.

Retailers and e-commerce businesses recognize that this is the case, and invest heavily in social media marketing. Seventy-four percent of retail leaders allocated at least a third of their marketing budget in 2020 to social media ads, with most planning to increase social ad spend in 2021.

Retailers and e-commerce businesses also recognize that consumers’ relationship to physical-store environments is changing — and that the changes are here to stay. Not only has COVID-19 accelerated the digital transformation of the retail business at large, accelerating the shift to online selling, but consumers are also gravitating to social media platforms for the kinds of experiences and inspiration that have traditionally been associated with physical stores.

“Social media platforms like Instagram are what I like to call the malls and high streets of the 21st century,” says Chris Walton, CEO of OmniTalk. “They’re where we go to discover and be inspired by products. The malls and high streets no longer hold sway in that regard over us as consumers.”

As Instagram’s sway over consumers continues to grow, brands are grappling with new challenges: Turning consumers’ discovery/attention into actual sales, and delivering relevant, helpful customer experiences to consumers on the channel they love (before, during, and after purchase).

“Consumers now demand instant, personalized, and effortless experiences from brands,” says Benjamin Gibert, VP of Marketing at Spectrm. “And because there are so many choices out there, there’s a need for consumers to gain a better understanding of brands and their offerings.”

“It’s important for consumers to feel that their choices reflect their values, especially for younger generations,” adds Gibert. “They buy from brands that align with their values, who support them in making the right choices. Messaging is the easiest way to learn more, and to build a direct relationship with a brand.”

Consumers now demand instant, personalized, and effortless experiences from brands. And because there are so many choices out there, there’s a need for consumers to gain a better understanding of brands and their offerings. Messaging is the easiest way to learn more, and to build a direct relationship with a brand.

Benjamin Gibert | VP Marketing @ Spectrm

Meeting consumers where they prefer to engage

Private messaging is growing faster than public social media, and it’s easy to see why.

Millennials and Generation Z consumers consider messaging the most natural way to communicate, given that they’ve grown up with smartphones, texting, and messaging apps. In a 2019 survey, 63% of the 1,000 people polled, all under 30, said they prefer to talk in private message threads rather than on open forums and feeds. As members of these generations grow in influence, all industries will need to adapt to a messaging-first reality.

Retail and e-commerce businesses are already experiencing the shift to messaging: Over the year leading up to October 2020, total daily conversations between people and businesses on Messenger and Instagram grew over 40%.

Engaging with consumers on Instagram is increasingly a business imperative. Instagram has more than one billion monthly active users — over two thirds of which are aged 34 years and younger — and 90% of the people on Instagram follow a business. In addition, 9 out of 10 consumers want to message brands, and 75% of consumers prefer to engage brands in private messaging channels over traditional channels. A full 150 million people on Instagram have a conversation with a business every month.

As a consequence of this growth in messaging, a brand’s Instagram Direct Messages (DM) inbox can be a marketing goldmine (and an essential tool in consumers’ buying decisions).

Already, the Instagram DM inbox is often where customers will reach out to brands to ask questions, for example — many of them pre-purchase queries. According to Spectrm findings, 70% of brands’ incoming messages on Instagram are pre-purchase.

“We’ve seen explosive growth in e-commerce and mobile commerce as long-term trends have been accelerated by the pandemic. Competition online is stronger than ever. Shoppers today have more pre-purchase questions to decide what and where to buy. They expect brands to help them on their purchase journey,” says Gibert.

“Things like ‘can you help me pick the right size’ or ‘how long will delivery take to my town’ or ‘is this ethically sourced’ — there’s a whole range of questions that influence and accelerate buying decisions,” says Gibert. “They’re questions that reflect people’s desire to learn more before they buy things — to have a conversation with the brand about product characteristics, for example, or find out if they sell specific products, or to determine what is the right product for them.”

As Instagram Shops — which places message buttons under every product — expands, brands will need new ways to address higher messaging volume and help customers get the information they need to feel confident making purchases. According to Instagram, 130 million accounts tap on shopping posts to learn more about products every month.

Today, Direct Messages on Instagram are predominantly seen through the lens of social care — with each message being treated as a problem or a support ticket that gets kicked over to the customer care team to deal with. Brands are missing the opportunity to create a strong customer relationship.

Benjamin Gibert | VP Marketing @ Spectrm

The ability to identify customer intent and instantly respond with helpful information and personalized product recommendations will increasingly drive sales, upsell and cross-sell opportunities.

Having relegated Instagram Direct Messages to social care teams, however, brands currently lack the ability to respond to incoming questions at speed and scale.

“Today, Direct Messages on Instagram are predominantly seen through the lens of social care — with each message being treated as a problem or a support ticket that gets kicked over to the customer care team to deal with,” says Gibert. “Brands are missing the opportunity to create a strong customer relationship. They’re missing the opportunity to make a sale. They’re missing the opportunity to learn more about their customers. And that’s a huge lost opportunity.”

Helping brands capitalize on high-intent moments

Each message from a customer is an opportunity for not just one-to-one engagement, but also relationship-building and sales.

Automating responses to frequently asked questions (FAQs), for example, enables a brand to instantly respond to inquiries and shorten time to value for each inquiring customer — helping drive up satisfaction and increase a customer’s likelihood of taking action.

“You want to make the customer experience as frictionless as possible,” says Thomas Ränke, Head of Business Development & Partnerships at Spectrm. “If someone has a quick question — about, for example, a new product launch — and the answer helps them to make a quick decision, that’s a high-intent moment the brand should be capitalizing on.”

“A brand can also really differentiate itself by providing a good, fast response to the customer versus the customer writing and not getting an answer for three days,” adds Ränke. “When that kind of delay happens in today’s world that customer is gone and might not come back, because they found an answer somewhere else with another brand.”

Getting to know customers and their preferences

Using conversational AI, forward-thinking brands are also using Instagram Direct Messages to “guide shoppers through the commerce journey by essentially asking them what they’re interested in and helping them find the most relevant products,” says Gibert.

For example, campaigns that promote messaging — via giveaways, quizzes that lead to personalized shopping experiences, and more — can engage a brand’s existing customer base while also driving direct interactions with individuals who would otherwise only engage with the brand’s external social content.

Proactively engaging users in this manner can multiply organic engagement, drive new customer acquisition, and create new opportunities for getting to know customers and their preferences. Using those preferences to personalize the customers’ offers and experiences ultimately boosts sales: A full 80% of consumers are more likely to make a purchase when brands offer personalized experiences.

“Running giveaways and personalized offers is a big focus area for social commerce, and messaging has a key role to play,” says Gibert. “Brands are running live shopping events, or sharing stories and posts that say ‘Comment to learn more about our giveaway’ or ‘Message us to get your unique offer code,’ for example. They’re actually using Instagram DM automation as a tool to increase organic engagement on their posts, which obviously boosts their visibility, but it also creates a direct-message connection each time.”

It works like this: As soon as a customer comments on a brand’s giveaway post (or reacts to its story), the brand automatically messages them — kicking off a journey that begins with explaining more about the giveaway or sending the customer a personalized offer. Now that the brand has opened this DM channel with the customer, they can use it to funnel the customer into other commerce journeys that they have (or re-engage them later on).

“For customers, you might enter the DM thread via a giveaway, you claim your code, you start learning more about the brand, and then you can explore their product finder journey, all via DMs” says Gibert. “For brands, you’ve transformed a passive post to your audience into a seamless and highly interactive one-to-one shopping experience with multiple touchpoints. All right on Instagram.”

Delivering privacy-first, personalized experiences

For increasingly privacy-centric consumers, consolidating their interactions with a brand into one conversation thread can be an appealing prospect.

“If I were able to have a private one-to-one thread with a brand where everything is happening — right from me discovering the brand to me getting inspiration and recommendations to making the purchase to receiving order confirmation, to getting loyalty offers, getting upsell offers that are most relevant to me — why would I go somewhere else?” says Ränke.

“If I have that messaging thread at my fingertips I can always just message the brand like I would a friend or family member,” adds Ränke. “So why would I go through the hassle of creating different accounts on the website or clicking through different ads and landing pages instead of just having this in this one-to-one thread with the brand where I know everything is tailored to me personally?”

By tailoring the experience to the customer, the direct-message shopping experience even improves on the in-store model.

Conversational commerce takes the personal, in-store experience of a one-to-one dialogue and moves it to a digital platform, helping build lasting relationships between the customer and the brand. But unlike traditional one-to-one experiences, conversational commerce can achieve a level of scale that is not possible in brick-and-mortar retail — enabling brands to unlock data and insights they can use to optimize customer journeys or personalize experiences.

“If you think about traditional store retailing, at best you were left to the conversations of the frontline employee to get insights about your customers,” says Walton. “By communicating via DM, you get an exact sense of what people are shopping for. You can provide assistive experiences within that conversation, you can provide follow-up information or up-sell ideas at a scale you can’t achieve in-store. All kinds of different value can flow out of that.”

Communicating via DM also improves on traditional e-commerce. By gathering preference information and understanding customers’ intents with conversational AI, for example, brands can better meet those customers’ needs and expectations. They can personalize offers at high intent moments. Rather than chasing customers around the internet, retargeting them with generic ads, they can act on that customer data to personally engage them with the right message, at the right time.

Using great experiences to get declared data

Communicating with customers via Instagram Direct Messages generates the kind of declared data (or “zero-party” data) brands can use to better understand their customers and what they want.

At a time when big ad players like Apple and Google are tightening their rules on what data brands can access, communicating directly with customers via DM helps put control back in the hands of brands — giving them the ability to capture customer preference information that can be applied to personalize recommendations in real-time and offer a better customer experience.

“Privacy regulations, updates to iOS, and browsers deprecating cookies are all restricting the amount of data that advertisers have. They’re not able to send the same degree of conversion data back into the ad platforms, which has a huge impact on their campaign performance,” says Gibert. “It limits the targeting audiences that brands can reach. Less conversion data and less specific targeting audiences means less efficient remarketing and prospecting activities. This is a major challenge for digital marketers.”

These major regulatory and technological changes are already “hampering the ability for retailers to triangulate third-party data with their first-party data,” says Walton. “Those actions taken by Google and Apple just put more of an onus on brands each and every day to get good data from their customers. That means they have to create digital experiences people want to engage with.”

Acquiring zero-party data —and using it to personalize the customer experience — is essential to success in the future of retail and e-commerce.

90% of marketing leaders agree personalization significantly increases profitability, and marketers who implement 1:1 personalization earn an average ROI of 47%. Yet 84% of marketers are concerned

about the challenge of implementing ad personalization. Even back in 2019, 45% of marketers said they didn’t have the data and insights they need to power effective personalization, and 48% of marketers cited data quality as a leading roadblock to effective personalization.

With cookie deprecation coming in 2022, the challenges will grow even more significant unless brands start communicating directly with their customers at scale. Conversational marketing not only addresses the data gap by gathering insights through direct communication, it also provides a way to act on the data instantly — right in the moment that matters most.

In conclusion: seizing the opportunity beyond social care

Instagram Direct Messaging automation can help brands create engaging digital experiences that help them fill their data gaps, personalize customer experiences, and drive new customer acquisition — all in a privacy-first way. It can help brands multiply organic engagement and build better relationships with their customers based on frictionless experiences, declared preferences, and data-backed insights.

Now is the time to stop underestimating the power of the Instagram DM inbox and embrace a messaging-first future of retail and e-commerce.

Ultimately, embracing conversational commerce for Instagram Direct Messages is a huge opportunity for brands to:

Boost engagement, followers and sales with DM-based campaigns like product raffles and quizzes
Automate FAQs and pre-purchase queries to drive sales and lessen customer-care workloads
Offer better customer experience than competitors by understanding customers’ intents with conversational AI and respond instantly in one-to-one conversation
Increase customer satisfaction by enabling customers to engage with brands 24/7 on their preferred channel
Deliver instant, personalized shopping experiences by combining Instagram Live with Instagram Messaging
Accelerate customer buying decisions with product recommendations and assistive conversational commerce journeys
Build stronger customer relationships by collecting insights from your Instagram community
Grow customer lifetime value by sending personalized offers via DMs, including temporary product offers, limited vouchers and early access codes for new product launches
Connect with younger consumers who are more likely to choose messaging over other channels to reach out to brands

And it’s all possible to achieve quickly, with no coding required. To see how you can earn more from your Instagram inbox with Spectrm conversational marketing automation, sign up for a demo today.