For those of you following Instagram’s ad business, my headline might seem a bit familiar — yes, the Facebook-owned photo-sharing service announced another advertiser milestone back in February, but at the time there were only 200,000 advertisers, less than half of the 500,000 advertisers that Instagram says it has today.
To be clear, the company says that’s the number of active advertisers in a given month, so it’s not counting someone who ran a campaign a year ago and never came back. And it says 1.5 million businesses have converted to the new business profiles that launched at the beginning of summer.
This time around, the big message is that Instagram campaigns aren’t just about reaching eyeballs, but also convincing users to buy products. For one thing, the company says that since the global launch of the ad program last September, Instagram ads have driven one billion user actions. It also says those ads drive a 2 percent lift in offline sales.
As an example, Instagram points to handbag brand Dagne Dover, whose Instagram campaign combined a Shop Now button with targeting at students, mothers, professionals and women interested in fashion and travel, ultimately increasing return on ad spend 13x in two months.
“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.
Quarles told me that Instagram will be giving businesses more data in this vein. In addition, it will be rolling out “different ways to tell stories” (so, more ad formats) and doing more to understand the “customer journey” (which could help advertisers show you the right ad at the right time, rather than trying to sell you a product before you’re interested).
As for whether or not users can expect to see more ads in their Instagram feed, Quarles said that the company is monitoring engagement closely, and that there’s no set ratio of ads to non-ads. The key, he said is to make sure that ads are “relevant to you … they’re as well-crafted, they’re as high quality as all the content in people’s feeds.”
