Instagram to Monetize with Ads Soon
According to The Wall Street Journal (WSJ), Instagram will be enabling ads in its app as soon as 2014. This was revealed when the WSJ interviewed Instagram''s new director of business operations, Emily White, who joined Instagram from Facebook in March 2013.
Her presence in Instagram is mainly to enable the company to start making money off its massive 150 million strong user base, of which 128 million of them joined after Instagram was acquired by Facebook for almost a billion dollars.
Before White joined, the company under current chief executive officer Kevin Systrom's direction, was purely focused on improving the product and increasing its user base. Now, there are several employees within the company that are dedicated to analytics and metrics which advertisers need for targeted ad campaigns.
As it stands, the Instagram team is still in the midst of figuring out just what method of inserting advertising works. White's team is said to be looking at the app's Discover feature, which promotes popular content, as well as the app's search function.
This is a crucial stage for the company as any slight missteps (like last year's terms of service fiasco) may end up alienating Instagram's users -- most of which are teens and young adults, arguably the most important age group for marketers and apps alike.
Another issue is how will the company start charging marketers for advertising on Instagram, as there are already plenty of brands creating marketing campaigns on the service -- for free
Ms. White said she wanted to avoid repeating some of Facebook's earlier missteps with advertisers. She has regularly sought the advice of Facebook's top ad executives, including Ms. Sandberg; David Fischer, a vice president of business and marketing partnerships; and Carolyn Everson, a vice president of global marketing. Facebook "created a ton of different products and it got complicated," she said. The parent company has made strides in unwinding the complexity this year, she said. "I'm always looking at how to keep it simple."
Source: The Wall Street Journal