Instagram To Become A Major Source Of Ad Revenue For Facebook Inc
Instagram is adding more than 30 advertisers into one of its fastest-growing features, Instagram Stories, in a bid to boost advertising revenue, the company said on Wednesday.
The social media company will become a more important player in maintaining Facebook's growth in advertising revenue in 2017. During the last two earnings calls, Facebook executives said they may soon reach a limit on the amount of ads they can place before users, one of the factors that had driven ad revenue growth.
Instagram is expected to generate $3.64 billion in worldwide ad revenue this year, nearly double that of 2016, according to eMarketer. That would represent 12.3 percent of Facebook's global ad business, up from 8.4 percent in 2016. In the United States, eMarketer said it expects Instagram to account for more than 20 percent of Facebook's ad revenue.
eMarketer also found that 74 percent of US companies plan to use Instagram this year, up from 53 percent in 2016. This level of use would allow Instagram to surpass Twitter.
Interestingly media buyers are keen to know if Instagram has the ability to maintain Facebook's place, second only to Alphabet Inc's Google, in the digital ad marketplace. "Instagram could end up being as strong a revenue component for Facebook as YouTube has been for Google," said Noah Mallin, head of social for ad agency MEC Wavemaker.
In Instagram Stories, users and businesses can post a string of photos and videos that disappear after 24 hours. It launched in August and now has 150 million daily active users, according to Jim Squires, director of market operations for Instagram.
The new ad product will show full-screen ads intermittently as users swipe through photos and videos on Instagram Stories. This feature is being tested by major advertisers including General Motors Co , Nike Inc and Airbnb, which is using it to promote its product Trips on Airbnb.
Source: Gadgets 360
The social media company will become a more important player in maintaining Facebook's growth in advertising revenue in 2017. During the last two earnings calls, Facebook executives said they may soon reach a limit on the amount of ads they can place before users, one of the factors that had driven ad revenue growth.
Instagram is expected to generate $3.64 billion in worldwide ad revenue this year, nearly double that of 2016, according to eMarketer. That would represent 12.3 percent of Facebook's global ad business, up from 8.4 percent in 2016. In the United States, eMarketer said it expects Instagram to account for more than 20 percent of Facebook's ad revenue.
eMarketer also found that 74 percent of US companies plan to use Instagram this year, up from 53 percent in 2016. This level of use would allow Instagram to surpass Twitter.
Interestingly media buyers are keen to know if Instagram has the ability to maintain Facebook's place, second only to Alphabet Inc's Google, in the digital ad marketplace. "Instagram could end up being as strong a revenue component for Facebook as YouTube has been for Google," said Noah Mallin, head of social for ad agency MEC Wavemaker.
In Instagram Stories, users and businesses can post a string of photos and videos that disappear after 24 hours. It launched in August and now has 150 million daily active users, according to Jim Squires, director of market operations for Instagram.
The new ad product will show full-screen ads intermittently as users swipe through photos and videos on Instagram Stories. This feature is being tested by major advertisers including General Motors Co , Nike Inc and Airbnb, which is using it to promote its product Trips on Airbnb.
Source: Gadgets 360
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