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Instagram’s Coming Ad Formats To Include Location Targeting, Promotion Of Offline Retail

Seemingly satisfied with its branding program, the Facebook image-sharing app is adding a variety of direct response tools for large and small marketers.

Warby Parker in-store image from Instagram
Warby Parker in-store image from Instagram

Instagram has been treading very carefully about the use of location data when it comes to its year-and-a-half-old advertising program, but the Facebook-owned photo app appears ready open its platform to geo-targeting its 300 million active monthly viewers.

In addition to the major marketers like Mercedes-Benz, Taco Bell, Ben & Jerry’s, Levi’s, and others of that caliber that have used Instagram ads for developing brand affinity with users, the company is making its platform available to small businesses for the first time.

Targeting On The Way

Along with that change, Instagram is promising new ad units that will include call-to-action formats with “more targeting capabilities” to promote “offline sales,” the company said in a blog post. Testing of these new ad tools will begin “in the coming days,” Instagram added.

“Later this year, we will continue to connect businesses to the right people through expanded targeting options,” Instagram said. “Working with Facebook, we will enable advertisers to reach people on Instagram based on demographics and interests, as well as information businesses have about their own customers. We will also improve the feedback mechanisms within Instagram to give people greater control and improve the relevance of the ads they see.”

As proof that Instagram ads have generated brands’ desired results — and that it’s ready for a next step without fear of alienating its users — the company pointed to more than 475 global campaigns measured with Nielsen Brand Effect. It found that ad recall from sponsored posts on Instagram was “2.9x higher than Nielsen’s norms for online advertising.”

Making Money On Mobile

While Instagram parent Facebook’s mobile ad revenues comprised 73 percent of the social network’s total ad sales during Q1 —a notable rise from the 69 percent during Q4 2014 — the company is under immense pressure to ramp up its advertising business. Facebook not only faces challenges from its main rival Google, particularly in the local digital marketplace, but the social net must also deal with emerging ad programs from social media outlets Twitter, Pinterest, and Snapchat.

Considering that Facebook paid $1 billion for Instagram a little over three years ago, the time to fully explore the photo app’s ad potential is now.

Instagram's Jim Squires
Instagram’s Jim Squires

As the social media competition mentioned above roll out their own responses to Facebook’s programmatic ad targeting solutions, adding Instagram to its arsenal will help maintain its marketing dominance. To do so, both Instagram and Facebook will continue highlighting the respective “relevance” they can deliver to both its clients and its consumers, particularly when it comes to the ability to target based on places.

Time And Location

“People want to connect with businesses of all sizes on Instagram, from their favorite local clothing stores and restaurants to the largest brands in the world,” Instagram’s blog post said. “To give all businesses the opportunity to reach the right people, we are working to make Instagram advertising available through an Instagram Ads API and Facebook ad buying interfaces over the coming months.”

During a Q&A at last year’s Ad Age Digital conference, GeoMarketing posed a question to Jim Squires, Instagram’s market operations director, regarding whether the photo platform considered incorporating geo-data into its ad programs.

“I think that overtime, [location data] does fall into the targeting realm,” Squires said. “I think there will be interesting things that we can explore there, but for the purpose of this particular ad product, it’s less relevant because we’re trying to connect advertisers to a mass audience. I do think it’s great information that can be leveraged in future products.”

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.