Facebook has been very successful with its ad business model that focused mainly on helping small businesses get to the huge audience the platform houses.
In this line, the same business model is headed to Instagram – a social media platform that is owned by Facebook – after the photo and video sharing service decided to drop its dedicated focus on big businesses. The company is now ramping up its efforts in a bid to attract small business advertisers, just like the way its mother company did a few years ago.
Instagram has more than 400 million users. However, more than three quarters of the users are based outside the United States of America. Nonetheless, the company has been busy targeting its ad business at the big players in the country. The company expanded its ad business to cover entities of all sizes where small businesses including ones from Australia could make use of photo and video ads in addition to the platform’s carousel ads.
Instagram launched carousel ads back in March 2015 and with these ads, businesses can include links to their websites as well as products where users can “Learn More” by hitting a corresponding button when on the app. The short videos advertisements last only 30 seconds, which is no different from what is offered in TV ads.
A means to rapidly increase ad revenue
According to the COO of the company Marne Levine, the goal of 2016 is to increase the focus on small businesses so as to better its ad revenue.
The Instagram ad business was opened about two years ago and until September last year, the business was only available in eight countries. However, at the time of this writing, more than 200 countries can access this service locally. But Levine concedes that only bigger brands and businesses have been using Instagram to advertise and connect with consumers.
“I think that 2016 will see small businesses start to advertise more as well as take advantage of Instagram”, she said.
When Facebook acquired Instagram back in 2012, it promised that it will run it as an independent unit. However, Levine says that the two sales teams are now working more closely than ever. With the resources and infrastructure Facebook has, the COO believes that Instagram can leverage a lot from its mother company.
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