In a recent interview, Instagram’s director of business Emily White revealed that the platform should be selling advertising within 12 months, giving brands a new reason to consider investing in the mobile-first app and giving users a new reason to be apprehensive of Facebook’s old tricks.
Opening up to brand
Since Instagram’s acquisition by Facebook in April 2012, the platform has slowly become more brand-friendly. From being notoriously data-shy, Instagram now publishes key (albeit top-line) stats in a press tab on Instagram.com to appeal to brands.
The recent announcement of 150m monthly active users however is symptomatic of Instagram’s booming growth (from 22m upon acquisition) and one which brands may do well to pay attention to. With such a large user base and a hefty price tag, ex-Facebooker and Sheryl Sandberg protege White makes it clear that creating a revenue stream from the free app is a number one goal.
No brand should invest in a platform when the cost of doing so heavily outweighs the size of the fanbase.
Whilst many brands have invested in content creation and campaigns, they have been limited to organic growth within the platform.
Instagram ads should be a welcome tool for brands which may be over-investing in servicing an undersized fan community. Irrespective of what is said about the size of social followings, no brand should invest in a platform when the cost of doing so heavily outweighs the size of the fanbase. Instagram ads should enable brands to grow fanbases far more efficiently, making their content or campaign investments more effective.
The Instagram community has been wary of ads since the platform’s acquisition by Facebook. Just eight months later, Instagram introduced its first change to its Terms of Service which users were quick to interpret in ways which the company probably had not intended, forcing co-founder Kevin Systrom to issue a personal apology and revert to the original Terms.
Putting the experience first
Despite Facebook ownership, Instagram will want to tread carefully in making any changes that harm such a beautifully designed product and invite further outcry from the community. However it must also act to service brands who are keen to further invest in the platform.
Early suggestions from White show that she and Systrom are taking care to make advertising as unobtrusive as possible. But, as the community grows, its voice will diminish as Facebook has demonstrated with its 2012 Site Governance Vote which exposed the vast level of apathy (or more likely, confusion) around privacy and promotions.
Now at 150m (largely young) users, the Instagram community is likely to react similarly with the more passionate users drowned out by silence leaving Instagram free to make more imposing changes.
Luckily for the community, Systrom has shown he has a less aggressive stance on data privacy and advertising than Zuckerberg. And in the world of social, where promoted content trumps traditional ads, putting the user experience first can only be good news for users and brands.
Four potential Instagram ad products
Advertising real estate is hard to find on mobile and it is unlikely Instagram would allow ads over content to break the smooth flow of the home tab newsfeed. Instagram users are blessed with a simple, unimpeded experience and the community has already shown itself to be passionate about changes to the platform.
Explore tab promoted images: White disclosed that the explore tab, which surfaces popular posts amongst the community (and where users currently have the least affiliation to said images) is currently the focal point for Instagram’s first ads - promoted images seem to make the most sense here.
Newsfeed sponsored stories: If promoted posts do break into the newsfeed, they should take learnings from Facebook to offer sponsored stories in a bid to deliver more relevance for non-followers.
Newsfeed promoted posts: If advertising is to move into the coveted (and far more frequented) newsfeed we can probably expect brand content rather than ads to be promoted to non-followers.
Explore tab biddable search terms: The explore tab’s search function is also being investigated - presumably brands will be able to bid on search terms.