Instagram Ads Getting More E-Commerce-Friendly?

Chris CrumAdvertising

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Instagram is reportedly working on features that would make the service a better marketing platform for e-commerce businesses hoping to attract buyers.

According to AdWeek, Instagram is running marketing campaigns with brands including Banana Republic that take users right to product pages. Apparently that's just the tip of the iceberg, as "more sophisticated ads are in the works" including an option that would allow brands to link directly to their checkout experience. The report says:

The new ads are part of a carefully managed rollout of better marketing tools on the Facebook-owned photo-sharing app, which is starting to offer the sort of products brands have been demanding, especially in view of the $200,000 many of them are shelling out. And that's just the entry fee for buying ads on the platform, according to digital marketing executives familiar with Instagram's business. (Instagram declined to comment for this story.)

"Instagram continues to tease big things coming," said one Hollywood marketing executive who buys ads on the platform. "And they're talking about more ways to integrate buying."

It says one ad exec told them that instead of a buy button, as other social platforms have been tinkering around with, advertisers could more easily link to checkout pages.

The first phase of Instagram's "carefully managed rollout of better marketing tools" would seem to be the recently launched carousel ads (pictured above). These let brands add multiple photos to a single post, whcih uses can cycle through by swiping left. They also enable advertisers to feature a link, which makes them more attractive as an advertising option.

“One way to look at it is carousel ads bring the potential of multi-page print campaigns to mobile phones – with the added benefit of taking people to a website to learn more," explained Instagram upon launch. "For instance, a fashion company could use the carousel to deconstruct the individual products in a ‘look.’ A car company might share an array of different features of a vehicle and provide a link to learn more about the new model. Or, an advertiser could showcase how multiple ingredients come together to make a delicious meal."

A New Way for Brands to Tell Stories on Instagram from Instagram on Vimeo.

The first brands to adopt the ads were Showtime, Banana Republic, Old Navy, L’Oreal Paris, and Samsung. Showtime used them to promote its new season of Penny Dreadful, while Banana Republic and Old Navy promoted their respective spring collections.

You can certainly see where additional e-commerce options could increase sales from the visual social network, though the early adopters seem to be pretty pleased with the carousel ads themselves.

“Instagram is distinctly visual medium, and the carousel function enables us to deliver richer, more cohesive storytelling,” said Taylor Bux, Old Navy’s Director of Digital & Social Strategy. “Additionally, the direct linking to OldNavy.com creates a seamless experience for fans to purchase the items that they love without having to hunt.”

There's no question that now established visual social networks like Instagram and Pinterest have huge, still largely untapped potential in e-commerce. The latter is said to be readying the launch of a buy button similar to those being tested by Facebook and Twitter.

Shawn Budde, CEO of payments company 2Checkout told us he thinks Pinterest's buy button will change the future of e-commerce.

Some studies have found that social media hasn't been all that great for e-commerce conversions. We recently looked at a survey from Bounce Exchange, which found after analyzing over $1 billion in U.S. e-commerce transactions that social media marketing efforts only accounted for about 1.2% of total site conversions. Social conversion rates were 51% lower than sites' overall average rates, followers were engaging more with content that wasn't directly related to the products, and follow/share buttons were distracting shoppers and causing shopping cart abandonment.

But important e-commerce features from the social networks are basically still being incubated, and it's likely that once they are widely available, social will drive a lot more purchases.

As far as Instagram is concerned, there's still a great deal of potential to be tapped on the unpaid side of things. While one study suggested that brands are moving to Instagram in direct response to declining organic reach on Facebook, another found a shockingly low percentage of brands to even be on the service, even though those who are are seeing a great deal of engagement.

Socialbakers recently shared some stats about Instagram engagnement. Photos are still doing significantly better than videos. They get the highest volume of interactions at 13% on average. Most brands aren't using filters or hashtags, but those who are are mostly just using one. Interestingly enough, those in the e-commerce industry (as opposed to fashion, beauty, auto, beverages, or services) use way more hashtags than everyone else.

Yesmail found that while brands on Instagram experienced a 278% growth in followers in 2014, only 23% of the 2,000 brands it analyzed were on it. We spoke about this with Bob Sybydlo, Director, Market Intelligence and Deliverability at Yesmail.

“Instagram is still a fairly new platform, and is late in the advertising game – the platform introduced sponsored posts just two years ago," he said. "It’s possible that before 2013, marketers didn’t view Instagram as a must-have, but rather as a nice to have. As engagement and users increase, I have no doubt that we’ll see more brands adopt the platform.”

“One of the main goals when Instagram introduced sponsored posts in 2013 was to make their advertisements feel as organic as possible, and in my opinion, the social platform has been successful,” he said. “Instagram’s unobtrusive nature is part of the reason marketers can be hugely successful on Instagram. Consumers expect to see all types of images on Instagram, and as a result, won’t be thrown off when a brand gets involved in sharing. Additionally, Instagram’s new carousel ad offers a flexible way for brands to not only share, but tell an interesting story."

From the sound of it, Instagram is only going to be giving brands more reasons to explore advertising on the service in the near future. It will be interesting to hear about the results once more have had the opportunity to get involved with the e-commerce-specific offerings.

Images via Instagram, Socialbakers

Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.