Instagram has announced that more than 1 million business users are now advertising every month on its service, a 400% increase from the 250,000 using it just a year ago. Lucy Barbor, Head of Digital at media agency Carat, shares her thoughts on why the platform is proving increasingly popular with brands.

The original Instagram media format was the only format that, rather ironically, forced clients to think 'inside the box'. Unlike other digital platforms that demanded seemingly complex assets, a pretty image in a box was not only easy to understand, but relatively cheap to create.

The then ground-breaking Instagram filters meant that anyone could produce aesthetically pleasing posts with no more than a smartphone and a bit of imagination. Instagram was - and is - a truly mobile-first platform. Images viewed on a small screen are not subject to the same level of 'quality scrutiny' as traditional media. This meant people and brands could take more creative risks.

We must also remember that when Instagram launched the flat image, it was a much more easily shareable piece of content than video. Indeed, 2014's historic #nomakeupselfie was as much a triumph for an easily shareable format as it was of content that captured people's imagination.

With content creation this easy, Instagrammers began to develop their own visual language that translated across global borders and generated huge success for early adopters. From Deliciously Ella to The Body Coach, Instagram has been the driving force behind debut best-selling books and Instagram-to-TV shows. This meant an initial driver behind Instagram's success stories flew in the face of Facebook's own move 'from page fans, to paid reach'.

Early Instagram stars – both individuals and brands – benefitted not only from the high reach of their content but also, critically, credible word-of-mouth. Coupled with the curated nature of the platform, Instagram presented a popular and relevant space for advertisers to deliver brand (rather than performance) communications online. All of this, without having to serve 'rich media'.

While some brands have unlocked lucrative partnerships working directly with Instagram influencers, traditional bought media is the major opportunity for the majority of brands seeking to create reach on the platform.

For some companies, this was rapidly enabled via the automatic translation of their existing Facebook campaigns onto Instagram. Today, Facebook advertisers have to purposefully deselect the Instagram targeting option at campaign set-up, otherwise inventory is automatically served across both platforms – a positive efficiency for most advertisers looking to drive reach.

More sophisticated brands have inverted their use of this cross-population model using logged-in audience data to redeploy Instagram insights via Facebook targeting. As Instagram is perceived to be a more creatively rich, branding territory, advertisers have been testing and learning on Instagram first and then scaling activity across Facebook. This data-led approach has led to increasing 'always on' spend on Instagram, particularly for new product developments or newly launched campaigns.

It is this rich level of data that Instagram is now employing to demonstrate efficacy against business success metrics. It is moving away from the original engagement / follower-led rationale to a reach model similar to that of Facebook's. This is helping the platform bring more cautious brands on board so we will no doubt see the 1 million business users grow further at a global level.

So what next?

Well, with the popularity of brand partnerships, the credible, organic nature of the platform is slowly being eroded. Following the removal of the chronological feed, paid media, rather than algorithms, is now a necessary method for discoverability. To address credibility, brand partnership content delivered by influencers is now, for the purposes of transparency, accompanied by #ad or #spon.

As for format, we've seen the square frame creep outwards, into multi-frame formats, video and more – mostly in a bid to tackle the rapid rise in consumer use of Snapchat. This direct competition is understandable and it certainly avoids ad units from becoming 'stale' wallpaper. In particular, despite some initial consumer cynicism, Instagram Live Stories have proven particularly popular. They allow followers more 'always on' access to their favourite influencers. It will be interesting to see how these are further adapted and adopted by brands going forward.

As Instagram celebrate this latest business milestone, it's interesting to look back at the beautiful simplicity of Instagram's platform and track its impressive evolution into a social media giant.