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  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.
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