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DR advertisers wary of Instagram

News, 12 August 2016

MENLO PARK, CA: Direct response advertisers have been slow to warm to Instagram, the image-sharing app, with many preferring the reach and returns offered by its parent company Facebook.

Instagram was originally slow to embrace advertising, limiting itself to a few selected brand ads and vetting those that did appear as it sought to exercise some quality control over what appeared in users' feeds.

Direct response ad formats were only introduced last year, and the app's earlier image may be a factor in why, according to Marketing Land, these have "not yet totally clicked" with direct-response advertisers.

James Quarles, global head of business and brand development at Instagram, argued that "This perception that Instagram is only a place for latte art and yoga mats and sunsets is dated" and claimed that around 70% of DR campaigns had generated "statistically significant lift" for online conversions and mobile app installs.

But agency executives interviewed by Marketing Land were unconvinced. "Facebook is outperforming Instagram to such a degree that it would be difficult to rationalise — if you had $1, you'd put that dollar in Facebook," said Jeanne Bright, VP and group director for paid social at DigitasLBi.

She reported that Facebook's DR ads generated ten times more clicks to brands' sites than did Instagram's, while each click on Facebook cost one-fifth of the price on Instagram.

Gila Wilensky, search and biddable director at Essence, a GroupM-owned media agency, concurred that "the appetite is still for Facebook", where opportunities abounded.

"Our clients are typically focused on maximising Facebook [owned-and-operated inventory], and interested in testing into Instagram for DR," she said, "but less focused on really investing in Instagram as a standalone property."

Echoing Quarles, she added that driving mobile app downloads was the one area where Instagram had been a success.

"What we know as DR best practices – like [an ad] has to include the product, needs a clear call to action, needs to be salesy – I don't think that is necessarily the right creative message for Instagram," said Bright.

"So I think clients are still testing what is the right thing and creative experience that can go into Instagram and drive that sale."

Data sourced from Marketing Land; additional content by Warc staff