The future of advertising on Instagram

All you need to know about the upcoming advertising possibilities on the fastest growing social network.

Instagram is among the fastest growing social networks in the world, and for the US market it is the single fastest growing network by total number of new users.

For those wanting to target a younger audience, marketing on Instagram offers a huge opportunity. 53 percent of 18-29-year-olds in the US use the platform.

It is thus clear that especially for B2C brands, Instagram represents a key growth market for attracting customers, and those who fail to use it effectively risk missing out to competitors using the platform well.

Advertising on Instagram

In its infancy, there was no ability to advertise on Instagram, so the best brands could do was set up their own pages and try to build a following organically. However, the platform started allowing certain advertisers to use the platform a year and a half ago. These were major brands that created high-quality ads, and the results were pretty impressive. Ad recall from the sponsored Instagram posts was almost three times higher than the norm for online advertising. However, this should be taken with a pinch of salt as the platform has previously been ad-free, so it is not clear if these engagement rates will continue

A study by Instagram itself into the effectiveness of its ads (so do be a little sceptical, they’d want to make their ads seem effective after all) showed that of 4 campaigns reviewed there was a 32-point incremental lift in ad recall per campaign compared to a control group. There also was a 10 percent lift in brand message awareness. Statistics on ROI are not available because the campaigns were delivering board reach advertising to increase awareness. There was no option to click through to buy products or learn more.

New features for advertisers

Instagram announced a month ago that it would be increasing its ad offering to give advertisers more options. The different ad formats include letting people sign up, buy a product or download an app directly from an ad. Instagram has been relatively vague on the details, but these will be revealed in the coming months as the features are released.

Enhanced ad targeting

Instagram knows that it users won’t want to be bombarded with irrelevant ads. It also knows that advertisers want to only pay to put ads in front of people that are going to be interested in their products or services, so as to be able to get the best possible ROI.

Offering advertisers better-targeting options is a win-win scenario for all involved. The critical component to be able to target effectively is data. Does Instagram have the relevant data on age, gender, interests, location etc. that facilitates this kind of targeting? No. But it does know someone who does. As Facebook bought Instagram in 2012, it has access to the wealth of data that Facebook has on its users.

Instagram says this will mean advertisers will be able to target via demographics and interests data that has been gathered by Facebook.

How will Instagram ads be purchased?

Instagram have stated that they will be creating an Ads API for the platform, which will allow the purchasing of sponsored posts. However so as to make it easier for businesses large and small to purchase ads on the platform, Instagram says that it wants to ‘leverage the best of Facebook’s infrastructure for buying, managing and measuring the success of ads on Instagram’. This means you will be able to purchase Instagram ads through the current Facebook ad buying interfaces such as ads manager and power editor once the feature is rolled out.

Can I advertise on Instagram now?

Instagram announced that they would start by opening the Instagram Ads API to a select group of Facebook marketing partners, which are likely to be major brands. So unless you are lucky enough to be a marketer for one of the selected Facebook marketing partners, you can’t start buying ads on Instagram just yet. However it will probably only be a matter of months until it is possible for all businesses to buy ads on Instagram, so stay tuned to the Smart Insights blog for further updates on this.

Download Expert Member Resource – Smarter Instagram marketing guide

Our 48 page Smarter Instagram marketing guide will help you tap into the consumer activity on Instagram to use it to grow your business. It is broken down into 7 sections packed with checklists and examples to inspire you.

Access the Smarter Instagram marketing guide

 

 

 

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