It has not even been a year since Instagram opened advertising within the platform, and it now has 500,000 active advertisers. In fact, five months after the launch, the platform earned 200,000 advertisers.
Facebook, on the other hand, took about six years to gain 1 million active advertisers. Instagram, ever since the acquisition by Facebook (with its 3M active subscribers) has shown tremendous progress in terms of advertising and reach. Also, Instagram recently reported that out of its 500 million plus monthly active users, 300 million users are active on the app daily. The user base is greater than twice that of Snapchat and Twitter. It makes sense why advertisers prefer Instagram — Ads on Snapchat are generally costlier, and the simple and feed based layout of Instagram makes it more attractive for advertisers to crowd the platform. Not to forget, ad copies produced on other platforms can be easily syndicated into Instagram.
Instagram for business has been showing great progress, with 1.5 million users switching their accounts to business profiles. Facebook, Instagram’s parent company also reported that over one billion user interactions have taken place on sponsored posts ever since its advertising launch. It also says that these ads drive a two percent lift in offline sales. According to Instagram’s director of market operations, Jim Squires, the reason for the advertiser base to double over the last year is that the platform has introduced plenty new features such as direct-response ad formats, self-serve ad buying platform, ways to buy ads through third party tools and reach similar to that of Facebook. Squires also claimed that the advertisers who rely on Instagram ads the most are consumer packaged good brands, e-commerce brands, retailers, entertainment and tech companies.
Instagram wants to be known more for its quality than quantity. It wants its ads to be genuine, useful and important. “One of the most important things to us is that small businesses don’t judge their success based on followers or likes, but that they focus on real world actions,” said James Quarles, Instagram’s vice president and general manager of monetization. He added that Instagram would soon be rolling out various ad formats and many more ways for businesses to convey their stories and reach out to their customers better.
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