Last year, Instagram made official what most people in the industry certainly saw coming: advertising. At a cost of $1 billion, it was about time for Instagram to start showing Facebook the money and in-stream advertising is a pretty straightforward strategy for accomplishing this. The question marketers are now exploring is whether this will be seen as such an intrusion to users that it will ruin the overall app experience and drive them away. In short: no. We'll see some missteps as brands test the waters with this new format (see the trials and tribulations of real-time marketing post-Oreo Super Bowl), but overall this isn't anything that's going to negatively impact users in a substantive way. In fact, I'd argue that there are several use cases in which digital marketers could improve the experience of this new ecosystem.
Video provides a whole new medium for marketers to create connections on Instagram. There are already many successful examples from Vine of popular how-to's, which indicate how video should be approached on this site. Even the whiff of pre-roll-esque video will be completely rejected, and should be eschewed in favor of a more behind the scenes, lifestyle approach to video. Alternatively, as Peter Kafka pointed out at AllThingsD, 15 seconds is more than enough time to tell a story. I'd expect to see platforms like NowThisNews experiment with buying real-time inclusion in feeds to "break" news and build its following, depending on how fast Instagram's ad platform can incorporate ads into the stream. This would be an interesting way to try to shape consumer acceptance of Instagram as not only a social network, but a destination for content on a broader scale as well.
Heineken's "Crack the US Open" contest on Instagram last year took cake for most innovative use cases of the platform. While it was groundbreaking in its use of Instagram and creative playfulness with Instagram's format limitations, the campaign needed to rely on other social channels like Twitter to gain distribution. I'd expect to see more contests like this, promoted throughout people's streams to gain traction within Instagram as well as across other platforms.
Instagram is an extremely personal medium to its core demographic, as it's effectively a visually stylized life stream. Ads provide the opportunity to delicately improve brand awareness and to a lesser extent engagement by showcasing the lifestyle aspects of what a brand stands for. This could mean very different things for different brands, from behind the scenes clips of Fashion Week to a trip to a supplier's farm for Chipotle.
Bringing people with common interests together through user-generated photos will certainly become easier with promoted posts. Hashtag photo contests were embraced by Instagram itself (#weekendhashtagproject) and appropriated by brands like Immaculate Infatuation, who've engaged hoards of followers by encouraging them to post photos of their own adventures with topic-specific hashtags (#sandysnacks, #eeeeeats, #runhardsnacktough, to name a few). Prior to Instagram, user generated photo contests produced a lot of photos that were, frankly, less than beautiful. The auto-stylized images provided by Instagram allow ready-made content portrayed in brand appropriate ways, but a big challenge to this type of Instagram contest was attribution. Seeing a hashtagged photo in your stream doesn't necessarily expose that person to the brand itself. Now brand-sponsored posts can reward fans who use specific hashtags with broad exposure of their images while simultaneously adding in brand messaging: win/win (we'll assume the use of a branded hashtag is an "opt-in"). In sum, Instagram ads aren't the end of the world. Rather, they're opening up a whole new idea of what Instagram might become, how brands can reach consumers, and how consumers can choose to interact with brands. There will be some speed bumps along the way, but I'd expect for hindsight to show this as a minor storyline in Instagram's narrative, rather than the major arc. Bryan Maleszyk is director of strategy at Isobar.
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