In a similar fashion to ad revenue rivals Google and Twitter, the photo-sharing app will allow advertising agencies to use its users’ information, posts and even GPS location to deliver personalised ads and drive specific campaigns to consumers.
This opens up a unique opportunity for advertisers, as for the very first time businesses large and small, along with big ad-networks like Salesforce and Brand Networks, are able to post on the highly popular platform.
Market researcher eMarketer believes that the platform will generate $595m in mobile ad revenues worldwide this year
“The Instagram Ads API will help us make ads more relevant to the community, serve more diverse business objectives and make buying on the platform easier for advertisers,” said a spokesperson for Instagram. “We started working with a group of Facebook Marketing Partners a few weeks ago and they’ve brought great experience and technological savvy onto the platform. We’ll continue to build upon the Instagram Ads API in the coming weeks and months.”
Some analysts predict that the move will allow Instagram to transform itself into a major advertising business. Market researcher eMarketer believes that the platform will generate $595m in mobile ad revenues worldwide this year, according to a recent forecast looking at how much advertisers will spend on the social network.
“Now that Instagram is opening up, there is a lot of pent-up demand. The rollout of new features over the next several months means that by the end of 2015, Instagram will have a host of new ad products for advertisers large and small,” said Debra Aho Williamson, eMarketer principal analyst in a statement. “In particular, Instagram advertisers will be able to use a full slate of Facebook targeting tools, including the popular Custom Audiences feature. That will be a key drawing card.”
The market researcher contends that Instagram could even surpass Google and Twitter in US mobile ad revenues by 2017 – an assertion that is based around Instagram’s impressive user base, with it boasting more than 300 million active monthly users.
The adverts themselves will come in the form of photos or videos, which will command a higher price, helping the photo-sharing app to generate more revenue from advertisers.