Dive Brief:
- EMarketer anticipates Instagram will reach almost $600 million in mobile ad revenue this year, making up 5% of parent company Facebook’s mobile ad revenue.
- By 2017 the social media platform is expected to pull in $2.81 billion in global mobile ad revenue, and will pass Google and Twitter in U.S. display mobile ad revenue.
- Last year the social photo sharing platform passed Twitter to become the second-largest social media network.
Dive Insight:
Instagram’s mobile ad revenue is trending upward, and according to eMarketer is poised for extremely rapid growth. Revenue this year is expected to be $595 million and will rise to $2.81 billion by 2017 for global mobile ads. Just in the U.S. market the social media platform is expected to pass Google and Twitter by 2017 for U.S. display mobile ad revenue. One reason eMarketer anticipates this growth is new ad products from Instagram including direct response, the ability to buy ads through an API, and better tracking and metric measurement. Several of the new features are expected to roll out this fall for all advertisers.
“Now that Instagram is opening up, there is a lot of pent-up demand. The rollout of new features over the next several months means that by the end of 2015, Instagram will have a host of new ad products for advertisers large and small,” Debra Aho Williamson, principal analyst at eMarketer, said. “In particular, Instagram advertisers will be able to use a full slate of Facebook targeting tools, including the popular Custom Audiences feature. That will be a key drawing card.”
Facebook is expected to report Q2 earnings Tuesday after the market close and investors will be watching mobile growth and video ads.
