Instagram Is Dying for Merchants' Promotion and Marketing
Last year, a TikTok influencer had a talk with an Instagram employee. At the end of the conversation, she got the real pitch. They want her original posting on Instagram Reel, which means she had to choose one, Instagram or TikTok?
As a photo and short video-sharing social network application, Instagram has developed twelve years to become one of the world's biggest and most influential social media platforms. And it has become a cash cow for Meta.
Facebook (now Meta) bought Instagram for about $1 billion in 2012, and by 2018, it was worth an estimated $100 billion. In 2021, Instagram's net ad revenue share in its parent company reached 52.6%, surpassing the core Facebook program for the first time. And it kept growing from 2019 to 2021. Instagram's ad share is estimated to go over 60% in 2023. In 2021, Instagram alone made more revenue than LinkedIn, Snapchat, Pinterest, and Twitter combined. Statistics show that it is the most popular advertising platform.
However, in recent years, new applications appear one after another, like TikTok, which has achieved 60% user growth in 2021, adding 456 million users.
The chart shows that nearly 50% of TikTok users are between the ages of 10 to 29. And as of 2021, TikTok had a total of 78.7 million users in the United States. Around 37.3 million of these users belonged to Generation Z. This number is projected to reach 48.8 million by 2025, surpassing Instagram's Gen Z audience size.
The attraction of young people also draws attention from advertisers. The following data from CouponBirds gives some evidence about retailers' options.
According to the chart presented, CouponBirds' collection of coupons from Instagram in Q1 2022 declined by 7% on a season-to-season basis. Although there was a sudden spike in Q4 2021, the number of Instagram coupons obtained has been decreasing over the past year. Additionally, the overall proportion of coupons obtained from Instagram hovers around 50%, indicating that Instagram may no longer be the top choice of retailers. Its role as a promotional platform is shifting to other options, such as TikTok.
Despite this, Instagram and TikTok remain the primary options for marketing and promotion for merchants, but there is a shift in focus. The increase in influencers and traffic will inevitably attract more advertisers. The previously mentioned influencer eventually moved to Reel due to its incentive scheme. However, whether more influencers and young individuals will gather at Reel remains to be seen. We will have to see what the future holds.
