Instagram’s Successful E-Commerce Model

Instagram RevenueWith so much focus on Twitter and Facebook, it’s easy to forget about the huge e-commerce success that Instagram has achieved before and after they were sold to Facebook for a billion dollars.

Although paying that amount of money for any business sounds preposterous to me, two key e-commerce truths make the purchase sit a little better.

  1. Most of the deal was made with Facebook stock – not cash. Companies that go public can afford to overpay for companies in stock because of the hopeful increase in the value of their stock and because it’s paper, not cash from reserves or monthly revenue.
  2. Instagram has really picked up steam and is doing some powerful things to get a significant chunk of the online photography-sharing market, reaching over a billion dollars in sales in 2016 and looking to raise revenue significantly in the coming years.

Instagram Top BrandsIn fact, Instagram amounts to more than 8% of all of Facebook’s mobile ad revenue. And tons of revenue and followers are coming from top brands like Nike, image king National Geographic, and 9GAG.

Imagine what an association with one of those companies would do for you and your e-commerce store!

But just like Trust Guard, this global leader isn’t just followed by huge affiliates with epic pockets, almost 50% of all online brands use Instagram in one way or another. As more and more companies see monetary benefits in marketing with Instagram, that percentage will only get bigger and bigger.

Instagram MarketingIt’s plain to see that competitors like Pinterest, without the backing of an e-commerce giant like Facebook, may have a harder time getting followers, and consequently, advertisers.

But give credit where credit is due. PC Mag did a review on both Pinterest and Instagram and rated Pinterest at 3.5 and Instagram at 4.5. Ratings and reviews, like those offered to business owners from industry leader Shopper Approved, are critical for today’s online consumer.

The Instagram team hasn’t been sitting back and doing nothing since getting the billion dollars. They have been working hard. In 2016 alone, Instagram

~ Revised post ranking by putting the best posts firsts instead of doing it chronologically.

~ Updated the Instagram icon.

~ Added instant translation capabilities, and

~ Included a new image zoom feature.

Companies like Rhino Support and Instagram is showing e-commerce companies all over the world some simple steps we can take to crush our competitors. They also teach us to keep improving our companies once we’ve become successful in order to stay relevant and continue to increase our customer base.


Special thanks to Megan Arevalo who shared her awesome infographic with us from WebsiteBuilder.org.

 

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