5 Reasons Instagram’s New Advertising Tools Will Be A Boon For Facebook

Last week, Instagram announced it was unleashing a brand new set of tools to help businesses manage their reach on the growing platform that boasts over 200 million users worldwide.  Instagram is becoming a huge success since it’s integration with Facebook and users are flocking to the social media site to share pictures and talk about brands.  Expect the changes to be positive for Facebook’s revenue stream in the next quarter or two.  Here are 5 reasons why Instagram’s new advertising tools will be a boon for Facebook:

1. Giving firms information about Instagram validates spending more money on the platform.  The biggest question for most advertisers is … “Great, we’ve heard about Instagram but will it make us any money?”  This is the same question they asked about Facebook a few years ago and now with Omniture, and Google Analytics, brands can see exactly what each additional like, comment or share adds to their bottom line.
2. Older users are joining Instagram. Although teens like Facebook but hate seeing their parents on it, more adults are joining Instagram yet they are still far more active on Facebook.  Teens just won’t be able to escape mom and dad via social media and their getting used to it.
3. Brands are having more success on Instagram than Facebook to some degree.  As an SEO, PPC, Social Media marketing consultant, I often hear from brands that they are finding more engaged customers chatting about their brand on Instagram – especially since Facebook changed their algorithm and makes likes less useful without boosting.  Younger people talking about products on Instagram are giving brands the information they need to make smart decisions about spending, quicker.
4. Account insights will help determine reach, impressions and engagement.  This will impact advertising spend on Google (and maybe Pinterest in the future) as well as other paid media buying online which could be positive in the long run.  Everything is measurable now and old media is still trying to figure out how to master this.
5. Online/mobile marketing will grow as a sector.  Because metrics are easily obtained, new and old advertising platforms will need to develop analytical tools early on and offer them to firms before gaining critical mass and hundreds of millions of users like Instagram.  The more measurable – the more dollars that will be spent on the advertising platform which will create spillover effects for the whole industry.

The new business tools from Instagram will help Facebook monetize mobile exponentially which was an early question in the early IPO days.  The question has been answered categorically as – Yes.  Facebook can monetize mobile and will continue to do so.  I’m looking forward to examining the new Instagram suite of tools for brands in more depth.