Instagram: The App with Incredible Potential as a Marketing Tool

In the five or so years it’s been around, Instagram has managed to catapult itself from a social platform casually used by people to share pictures with family and friends to a multi-million user app that is being increasingly used as a marketing platform. Defined as “a free photo sharing application that allows users to take a photo, apply a digital filter, then share it on a variety of social networking services, including [its] own,” Instagram was developed in San Francisco by Kevin Systrom and Mike Krieger, and launched on Apple’s App store in October 2010. In April 2012, the app was acquired by Facebook for $1 billion in cash and stock, and since then has been growing from strength to strength (Basu, 2012).

It’s easy to see why users were initially drawn to the app: it is the definition of the old adage “A picture is worth a thousand words.” In today’s society, the immediacy of such a platform is very attractive—you simply reach for your phone, snap a picture, share it and within seconds that image you felt the world, or, at the very least your friends, needed to see (your lunch, those flowers, that dog) is immediately out there.

Compared to other social media platforms, there is something pleasing about how streamlined and clutter-free Instagram’s interface is. Unlike Facebook, for example, Instagram is all about the pictures. (Of course, captions are allowed, and often add much to the image, but on the whole it’s safe to say the app is very visually based.) Whereas on Facebook your newsfeed is likely to be bombarded by your friends’ statuses, photos, and scores on Candy Crush, Instagram offers an uncluttered, steady stream of images. And, compared to Twitter, which may be considered to be the verbal equivalent to Instagram, users can instantly get the gist of what the people they follow are trying to convey without having to actually read anything. (It must be noted that while Twitter does permit the sharing of pictures, these are essentially secondary to its main purpose, which is conveying written messages in 140 characters or less.)

So, while all of these qualities make Instagram an attractive platform for the average user, what exactly is it about the app that makes it such an attractive marketing platform? In this essay, I will attempt to argue why Instagram’s features make it so ideal for this purpose, and why more and more businesses are using the app as a marketing tool.

In the early days of Instagram, the app was primarily used in a more casual way; simply as a way for friends to share mundane snaps from their day (jazzed up a little by one of the several filters the app featured, of course). In recent years, however, it has becoming increasingly used as a marketing platform, while still retaining the attractive interface that first had users flocking to it. (While users often complain about the subtle changes the app brings in every so often, the overall feel of it has changed very little over the past few years.)

In “Ten Reasons to Adopt Instagram as a Marketing Tool,” the author notes that “social media marketing can be tricky because the whims of the population change at a moment’s notice” but fortunately for Instagram, it currently has “the cool factor in spades,” having recently overtaken Twitter as the second most popular social media platform behind Facebook (Villegas, 2015).

Unlike other platforms such as Facebook, Instagram was designed as a mobile app, with a desktop version being added only long after the app had become “culturally relevant.” The fact that most of us are constantly on the go and glued to our phones has huge appeal for marketers—as Villegas puts it, “[their] customer base is always a click away from seeing [their] posts and becoming engaged with [their] company.”

It has to be said that while the very visually based Instagram doesn’t lend itself to every business (it’s hard to imagine an exciting or aesthetically pleasing feed produced by a law firm, for example), it does, suggests Villegas, “afford companies to market themselves in new and unique ways” with features such as hashtags, time lapse videos and Instagram-specific themes such as Throwback Thursday. On the subject of hashtags, the author notes that while these are now obsolete on Twitter (who knew?), and never really caught on on Facebook, they are “extremely powerful” on Instagram, and have a two-pronged effect: when using them you can both promote your business while also making it easier for consumers and other businesses to find you.

Another reason why Instagram should be used as a marketing tool? It can be used to conduct market research, via its native hashtag search engine, which gives users an idea of how popular certain hashtags are. This information allows the user to target which hashtags are most relevant to their business, and use them appropriately. In addition, apps such as Followers+ can be used to run analytics on posts and followers to help users better understand how well their posts are engaging with their audience.

Also of note is that of the top three social media platforms, Instagram is the most youthful, with more than 40% of its users falling in the 16- to 24-year-old category, while Facebook and Twitter have more appeal for older demographics. Villegas notes that any business that targets this demographic but does not yet have a presence on Instagram is essentially not worth its salt (2015). A study conducted by BI Intelligence found that overall, the app is “skewed towards urban, youthful women,” but it should be noted that even those businesses not targeting this particular demographic should not dismiss the app as a “useless opportunity” (da Cunha, 2015). Why? Because according to da Cunha, Instagram is showing similarities to Facebook, its parent company, which initially was a social network for students of Ivy League colleges but now has “a wide international presence and includes demographics of every age, gender, race, etc.” She notes that “[she’d] be willing to bet that your parents are on Facebook.” Essentially, while Instagram’s chief demographic (as of 2015) were young women living in urban settings, it won’t be long before even older men living on farms (for example) will be jumping on the Instagram bandwagon.

The growth potential for Instagram right now is “tremendous,” with the stats bearing testament to this. In 2013, the app grew by 66% (“the biggest jump of any of the top ten mobile apps during that time period”), and brands that advertise with Instagram “receive 15 times as much engagement as they do on Facebook.” Additionally, Instagram’s sponsored posts program has proven to be more successful than Facebook’s counterpart, “boasting tremendous results in terms of ad recall and converting viewers into followers.” While Instagram’s sponsored posts come across as “organic and relevant,” the sponsored content on other social media sites can feel “spammy and unengaging,” according to Villegas. As an avid Instagram user myself, I can attest to this—several of the accounts I currently follow were initially introduced to me via a sponsored ad on my feed. And I have definitely doled out many a like to the images produced by sponsored content, which at present only advertises itself as such with a discreet “Sponsored” on the right-hand corner, and a button you can click to “Find Out More.” On Facebook, by contrast, I tend to find sponsored content irritating, and I have never “liked” a business or wanted to know more about it simply because it popped up on my feed.

Another attractive aspect of Instagram is how ideal it is for launching a marketing campaign featuring user generated content: “[companies] can enjoy the benefits of residual marketing that happens organically, and all they have to do is advertise the promotion and monitor the results by clicking a hashtag. It’s a win-win, especially given Instagram’s ubiquity and reach.” Lastly, Instagram has been proven to significantly increase revenues, which, of course, is “the ultimate goal of any marketing campaign.” A study by Shopify—a “Canadian e-commerce company…that develops computer software for online stores and retail point-of-sale systems” (Wikipedia)—found that Instagram referrals had a “higher average order than those customers who were referred by Facebook, Twitter or Pinterest.”

It is worthwhile to look into the history of advertising on Instagram in a little more depth. While these paid ads were initially only for large companies, Instagram is now making it easier for “any company in 30 countries” to advertise on the platform with a “self-serve” option. Furthermore, “analysts at Kenshoo, a marketing software company, predict that [Instagram] could make as much as $1 billion in annual revenue in the next three to four years,” with Emarketer having predicted that the app has made $595 million in ad revenue in [2015] alone (Griffith, 2015). It should also be noted that advertising on Instagram has huge appeal for businesses because, “unlike many mobile advertising platforms, Instagram has the ability to target its ads to very specific audiences using technology and data from its parent company, Facebook.” And because this specific targeting is so desirable, the pricing of ads on the app has been on the high side, with an average cost-per-thousand views (CPM) of $6.70 (a figure that is likely to change as more advertisers come on the system, according to Kenshoo). Likely because of its niche targeting, Instagram also boasts impressive clickthrough rates: “users are two and a half times more likely to click on ads than on other social media platforms,” says Kenshoo.

Additionally (as I mentioned in my other essay for this class), there is huge potential for advertisers to collaborate with bloggers and celebrities to promote their products. The rates can seem ridiculously high to those of us not in the spotlight—for example, Kylie Jenner reportedly can command $300,000 for a single Instagram post endorsing an advertiser’s products—but all things considered, a celebrity like Jenner has at present a dedicated following on Instagram of 57.1 million users, which is a staggering amount (Brown, 2016).

So, what does the future hold for Instagram as a marketing tool? It appears Instagram is treading carefully for the time being when it comes to advertising on the platform, not wanting to cause outrage amongst its 400 million plus users, who are extremely verbal when it comes to venting their frustration at changes the app brings in (Griffith, 2015). (The latest proposed change, in which users’ feeds would be arranged not in chronological order, but rather in the order of which users they interact with the most, had users in an uproar.)

In “The Future of Advertising on Instagram” (Allen, 2015), the author notes that when the app “officially switched on its ads API [in August 2015],” a huge turning point was marked. Prior to this, ads could only be bought by contacting an Instagram sales rep directly (and then, this was only for larger companies in certain locations), but the changes brought about mean that Instagram can grow at an even more rapid pace. Analysis conducted by Bank of America Merrill Lynch predicted that the app’s revenues “could increase tenfold over the next two years, to reach near $1 billion in 2017, and continue to skyrocket, to over $3.8 billion by 2020.” While Instagram overtook Twitter in late 2014 in terms of the number of monthly active users, it has yet to overtake it in revenue—but at the rate it’s expanding, it’s almost a given that it will do so within the next year or so.

All things considered, the future is looking remarkably bright for Instagram’s foray into being viewed as a powerful marketing tool. While no one knows quite what the future holds for social media platforms, it is pretty much guaranteed that advertisers will be flocking to the app in increasing numbers in the coming years as the opportunities it presents for reaching out to a huge number of users are vast.

Works Cited

Allen, Robert (2015, August 25). The Future of Advertising on Instagram. Retrieved from http://www.smartinsights.com/social-media-marketing/instagram-marketing/the-future-of-advertising-on-instagram/

Basu, Kaustav (2012, April 9). A Brief History of Instagram. Retrieved from http://visual.ly/brief-history-instagram

Brown, Kara (2016, January 19). Here’s How Much Celebrities Make in the Instagram Product Placement Machine. Retrieved from http://jezebel.com/heres-how-much-celebrities-make-in-the-instagram-produc-1740632946

Da Cunha, Margot (2015, January 6). 10 Instagram Marketing Tips to Make People <3 Your Brand. Retrieved from http://www.wordstream.com/blog/ws/2015/01/06/instagram-marketing

Griffith, Erin (2015, September 9). Instagram Gets Serious About Ads, Opening Platform to All. Retrieved from http://fortune.com/2015/09/09/instagram-advertising/

Shopify (n.d.). In Wikipedia. Retrieved from https://en.wikipedia.org/wiki/Shopify

Villegas, Felipa (2015, February 11). Ten Reasons to Adopt Instagram as a Marketing Tool. Retrieved from http://getlevelten.com/blog/felipa-villegas/ten-reasons-adopt-instagram-marketing-tool

 

3 Replies to “Instagram: The App with Incredible Potential as a Marketing Tool”

  1. Ali,

    I’m not assigned to comment on your essay, but I found the topic and the research to be very interesting and relevant to any future endeavors as we head off into the real world. I’ve used Instagram in the past as a promotional/audience engagement tool for the company I used to work for and, in reality, had no idea what I was doing. I would just post pictures on a regular basis, throw in some hashtags, link to Facebook, and hope that this would connect our image to other businesses, our location (#westcoastbestcoast of course), and garner some likes. I didn’t really know what I was trying to achieve exactly, and just enjoyed posting pictures. Your argument that Instagram engages with audiences in an “organic” way, rather than “spammy” or impersonal, sheds some light on what makes Instagram successful in connecting with audiences in a way that other social media platforms do not. This makes sense, and I think that this comes out of being visually-driven, yet not necessarily coming across overtly as an ad campaign. This could be because every single Instagram post, regardless of intention, is in its own way an ad, whether for a brand, product, or lifestyle, so content that is pushed by a company doesn’t stand out.

    I am surprised to learn that people consider hashtags to be no longer relevant on Twitter, but I can understand how they seem to be finding their best purpose on Instagram. By tagging a single image with a number of keywords, the links are exponential, while also allowing the user to create a specific brand. It also allows users to engage with products and companies directly, like other social media, but in a way in which someone who loves a certain coffee chain or clothing brand can display their preference easily, just by posting a picture, often simultaneously displaying an element of their own personal ‘brand’. This works very well for the actual brand, as every single picture of a Starbucks cup is an ad for Starbucks. For the brand, it’s almost effortless advertising.

    Thank you for covering a number of ways in which Instagram is an essential marketing tool, and for providing reasoning and examples that connect to my experience and make this form of marketing make sense. I thought your essay was very well written and an engaging read. I would have loved some pictures, especially from your own Instagram, to accompany your points, as I think this would have been very effective, not to mention great advertising for your own content!

  2. Instagram is becoming a very suitable platform to do content marketing. With the development of social media, every brand and human is a media company. They focus on provide content services. This kind of marketing is totally different with advertisements. We have reasons to believe this is the future. And as Ali said in the essay, Instagram can be a Incredible potential Marketing Tool at this time.

    Actually, an advantage of Instagram is that everyone can find their “organization” here according to their own interests and hobbies. This feature makes brands determine their target consumers effectively. They can select the specific users, communicate with then directly and make targeted marketing plans.

    But for users, the reason that they like Instagram is its free environment. They can communicate with anyone who have the same interests and share information with each other. They do not want marketing be put in their communication. Therefore, Instagram always develop carefully on the road of commercialization. They cannot give up the atmosphere of leisure and entertainment which users love most. Once put too much commercial elements into it, it is difficult to ensure that users will, as always, chose Instagram as the first choice for their social media. Instagram want to make the advertisement as natural as the common photos and videos which users share. In addition, many brands have begun to try to use it as a platform for a variety of creative marketing.

    I believe that there is also an important reason that Instagram can be a good marketing tool is the short videos. The short videos on Instagram are only 15 seconds. But the social media shared elements in these short videos are very valuable.

    With the new authoring tools appeared, the process of making short video becomes absolutely simple. Everyone can shoot and edit content of short films and everyone can use the same basic kit and intuitive interface. In other words, anyone with a smartphone can create a short video.
    Our world is filled with the information, it is become difficult for people to focus on something and generate interest on some products. In such a world, we need to learn how to refine information from stories.

    A good example is the retailer: Target. The company uses short videos to tell us: that the concise design and stylish attitude of life are the reasons why it is different from other companies. The videos “Summer Up Decision Maker” they made introduced some activities and invited people to click on the video, stop it and bring fun to them just like to do play some online games.

    Creativity is unlimited. With the aid of social video short, Instagram is really have a good future.

  3. Although it tends to rely pretty heavily on a few sources, this is a very informative essay on Instagram. That said, while informative, I do not think the essay really argues for the reasons for its rise for marketing. It presents many of the characteristics the author obviously feels contribute, but does not explicitly put forth the author’s point of view or analysis on these. A worthwhile read for those unacquainted with the platform.

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