Dive Brief:

• Instagram may have enjoyed a strong 2015 in advertising, but research from Venture Beat revealed 60% of its daily users were unhappy with the increased frequency of ads showing up in their streams.
• Separate research from Quintly also found that Instagram's interaction rate was down 40% last year.
• Indicative of the social media platform’s advertising success, it passed Twitter in active advertisers this year, and it also reached 400 million users last September.

Dive Insight:

Julian Gottke, communications manager at Quintly, told Venture Beat, “Instagram is and will continue to be a meaningful network for brands and their storytelling. Through its visual characteristics, it urges brands to be more creative and thus publish more interesting and less obtrusive content. This makes Instagram pleasant to use for consumers and from a brand’s point of view, the interactions will most likely stay higher compared to Facebook.”

Even though Instagram’s engagement level is dropping, it does still have the cachet of being “authentic” in that marketers must use the platform to post content as it doesn’t allow posting through its API.

For advertisers Instagram is becoming even more like its parent company Facebook with a recent rollout of new options including profiles for businesses (similar to Facebook’s brand pages), additional measurement data on all posts (paid or not), and the ability to buy ads via a mobile device.

One other change that would make it that much more similar to Facebook is a possible tweak to its news feed algorithm, which currently displays posts in reverse chronological order. The potential change, which was first reported by the New York Times, would display photos and videos based on what Instagram thinks users want to see. It's unclear how that change would impact the ads that are served to users on the app, but if one thing is certain, response to the reported change from Instagram users was not celebratory.

rip instagram https://t.co/MLIxg2U0Ct

— Seth Fiegerman (@sfiegerman) March 15, 2016