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According to John McDermott at Digiday, Instagram is conducting a test (yes, for now it’s just a test) with Mercedes-Benz that allows them to target Facebook users who previously saw one of its Instagram ads. While this development is eye-opening in and of itself, as it gives hints into Facebook plans on returning their $1B investment, it also shows Facebook’s commitment to transforming how advertising not only can coexist with social media, but thrive and break into new levels of adoption.
What stands out the most to me is how inherent behavioral characteristics seen on both Facebook and Instagram are being aligned with their natural fit in the conversion funnel. As noted by McDermott, Instagram’s product naturally promotes behavior more conducive to the top of the funnel, where brand awareness comes into play. If Instagram is committed to preserving the user experience that allowed them to break 200 million users, it behooves them to preserve this characteristic of their product and not to “forcefully” incorporate more direct-response elements like call-to-action buttons, etc....
Facebook has just finished a deal to acquire mobile photo sharing app Instagram for approximately $1 billion in cash and stock. Instagram will remain an independently branded standalone app that’s separate from Facebook, but the services will increase their ties to each other. The transaction should go through this quarter pending some standard closing procedures.
Last year, documents for a standalone Facebook mobile photo sharing app were attained by TechCrunch. Now it seems Facebook would rather buy Instagram which comes with a built-in community of photographers and photo lovers, while simultaneously squashing a threat to its dominance in photo sharing.
At 27 million registered users on iOS alone, Instagram was increasingly positioning itself as a social network in its own right — not just a photo-sharing app. And it was clear that some users were doing more of the daily sharing actvities on Instagram rather than Facebook’s all-in-one mobile apps, which had to be cluttered with nearly every feature of the desktop site.