The photo-sharing app announced on Wednesday that it will launch ads in its Explore section “slowly and thoughtfully” in the months to come. Explore is the part of the app where Instagram suggests content you might be interested in from accounts you don’t already follow, and where it hosts IGTV, its standalone app for longer-form videos. In a press release announcing the decision, Instagram touted the decision as an “opportunity” for advertisers “to be part of what’s culturally relevant and trending while reaching new audiences who are looking to discover something new” and said that more than 50 percent of Instagram accounts use the Explore feature every month.
Basically, it’s going to work how Instagram ads already function elsewhere in the app — after someone taps on a picture or video in Explore and scrolls through related photos and videos, they’ll start to see ads just like they do in their main feed. Instagram emphasized that users will still have some control over the ads they see.
This is what it will look like:
The ad announcement marks Facebook’s latest endeavor to make Instagram, which it bought for $1 billion in 2012, more like itself. Those efforts have accelerated after Instagram’s co-founders, Kevin Systrom and Mike Krieger, left Instagram last fall, reportedly because of frustrations with Facebook. As Kurt Wagner reported for Recode at the time, the pair had grown increasingly unhappy with Facebook CEO Mark Zuckerberg’s “increased meddling and control over Instagram.” Now that they’re gone, and Facebook has appointed Adam Mosseri, a longtime Facebook employee, as “Head of Instagram,” the parent company has a greater ability to do what it wants with Instagram without as much internal friction.
Instagram is one of Facebook’s most valuable products and is on track to drive most of the company’s advertising revenue growth. KeyBanc Capital Markets research analyst Andy Hargreaves told Recode last year that he expects Instagram to grow to 30 percent of Facebook’s ad revenue in two years and 70 percent of its new revenue by 2020.
Given that scenario, it makes sense for Facebook to try to capitalize on Instagram’s moneymaking potential wherever it can — which means placing more ads in the app.
Facebook’s aim is to make Instagram as easy a place to shop as possible. In March, the company started letting US users buy items directly on Instagram’s app for more than 20 brands, including Zara, Nike, and H&M. As Nicole Nguyen at BuzzFeed News wrote earlier this year, Instagram’s “move to develop a robust shopping experience signals the social network’s interest in cashing in on purchases inspired by its content, but transacted elsewhere.”
Plus, of course, by letting people buy directly through the app, Facebook also gets to track more information about them. And data tracking, as we are all well aware, also means dollars for the tech giant.
In April, Instagram made it possible to shop directly from influencers’ posts as well. The company opened up the same option for certain media brands, too, such as Refinery29 and Vogue.
All of this could potentially wrap into Facebook’s upcoming cryptocurrency play, “libra.” Earlier this month, Facebook announced that it and more than two dozen partner organizations will launch a virtual coin to trade among its 2 billion users around the world in the first half of next year. If libra successfully gets off the ground and in wide use (there are a lot of ifs here), people could presumably use it to shop right on Instagram, or make purchases from ads.
Facebook wants to make Instagram as sticky — and lucrative — as possible, and it’s not slowing down anytime soon.
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