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BizReport : Social Marketing : September 10, 2015

Kenshoo: Are Instagram Ads worth it?

Instagram has signed on several top tier advertisers and platforms to their new Ads API, and now some early results are coming in from those campaigns. According to Kenshoo data the average cost-per-install is $6.30 while the average click-thru is 2.48%, making an average cost per click of $0.51.

by Kristina Knight

What do these early numbers mean for advertisers looking at Instagram's interface?

"It's obviously early days in the life of Instagram advertising but the initial performance indicators show there is good potential - for example with CTRs around two and half times that of the industry average for social ads," said David Zelniker, Product Manager, Kenshoo.

The Kenshoo team have identified some best practices for early adopters into the Ads API. They note the ad content must be creative and unique because of the visual medium, and also believe using ads from Facebook or Twitter within Instagram will not be a big engaging factor.

"This makes sense because of the audience's focus on the visual, meaning ads need to be visually appealing and use high-level creative. Ads created for other social platforms may not translate well to Instagram. So auto-importing ads from Facebook campaigns doesn't cut it, especially as they're different sizes anyway," said Zelniker. "On the other hand, Facebook targeting parameters (such as Lookalike Audiences - which creates a new list of Facebook users that share similar interests and demographics to your existing targets) are effective in driving ad engagements."

But overall, despite the low average CPM ($6.70) compared with other social platforms, Kenshoo's experts believe the Instagram offering could be worth the investment of time and energy.

"CPM is still low compared with other social platforms, so there is an opportunity for early Instagram advertisers. But this could change as the program expands and competition increases," said Zelniker. "Overall it's going to be important for Instagram advertisers to be prepared to invest time and resources to testing and optimizing their ads and ad targeting based on performance data to help them learn what works and what doesn't work on the platform."

Image via Shutterstock

Tags: instagram ad tips, instagram advertising, Kenshoo, social marketing, social marketing tips

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