The Conversation Starter

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Opportunity

One year ago Instagram introduced native advertising in the United States utilizing promoted photos and videos from major brands introducing a new multibillion dollar advertising business. Thus far ads have been creative and engaging emphasizing audience storytelling. The advertising program has seen an increase in brand awareness, cross platform lift and traffic for many of its early partners, particularly the retail companies involved in the program. Due to its success, Instagram is opening up its application program interface (API) for advertising in the middle of August to marketers and then general advertisers in Q4 of 2015.

Instagram Facts:

  • 300 million users worldwide
  • 60% 18-24 usage
  • 70 million photos per day
  • 5 billion likes per day

Instagram will launch multiple advertising products resembling similar offerings from parent company Facebook. The carousel ads on Instagram will bring multi-page print campaigns to mobile devices with the added benefit of taking the audience to a website to learn more. Overtime campaigns will mirror the same objective based goals Facebook campaigns offer. All Instagram ads will have a special tag in the top right that says Sponsored. The image below from Instagram shows a mock-up of the carousel’s layout and storytelling ability.

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In addition to carousel ads, photo ads will be launching and giving brands the opportunity to reach a passionate and engaged audience by delivering messages in a focused, creative format. Sponsored photos will measure reach; brand awareness and ad recall appearing natively in the user’s feed.

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Companies can tie together Instagram Ads with Facebook campaigns to increase cross platform measurements effectively increasing engagement, website traffic and conversion opportunities. Audience targeting will leverage the same tools as Facebook advertising providing Instagram with a leg up over other social media ad products. Analytics and reporting will also appear along side the Facebook dashboard with delivery and measurements including:

  • Impressions
  • Reach and frequency
  • Demographics
  • Brand metrics
    • Ad recall
    • Message awareness

Unique to Instagram will be the ability to measure ad recall and brand awareness by leveraging Nielsen technology. Instagram’s goal is to grab the user’s attention with concept driven creative that is relevant and tasteful. Initial beta testing partners were buying on a CPM basis with businesses with large-scale budgets seeing a CPM of $20. Instagram informed Penna Powers CPMs would come in at $13 when advertising opens in mid-August. Estimated CPCs have not been discussed yet but will be available as more objective based campaigns come online.

Instagram Advertiser Results (Instagram for Business Blog):

  • 97% lift in ad recall
  • 16-point average ad recall lift
  • 7x higher Nielsen ad recall vs. other study data
  • Users spend on average 5 minutes per day on Instagram and Facebook

Though many other social media channels offer similar promotion tactics, Instagram holds the only claim to be able to utilize Facebook’s powerful targeting capabilities. This means that companies can reach their target audience at a much lower cost across two of the largest social media channels in the United States and world. First and foremost, the average Instagram user is looking to engage with their day-to-day brands. Thus, sponsored posts will likely increase brand awareness, engagements and purchase interest for your products.

As marketers we are on a constant hunt for new tools to leverage in the battle for consumer eyeballs with more and more budgets shifting to social media. Instagram’s popularity continues to grow reaching 300 million users in 2015, a majority of them being millennials. This growth shows no evidence of stopping in the near future. By launching sponsored campaigns on Instagram brands will rewarded and recognized as early innovators. At the end of the day Instagram’s engagement rate dwarfs Twitter’s engagement signaling to marketers of all sizes that shifting their dollars to Instagram is a smart bet.

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