User-generated content is a highly prized commodity with marketers who use it to prove their brand’s authenticity. When marketing to Millennials, a segment of consumers who are particularly swayed by user-generated content, visual content is especially useful. Instagram, a social media platform that relies heavily, and in some cases, solely, on visual content, is quickly shaping up to be a perfect match for marketers pushing a brand.
Instagram has had somewhat of a meteoric rise among social media platforms. Within 2.5 years of launching in 2010, Instagram announced it had 100 million active users. Recently, the company said it hit 300 million active users, who have uploaded 20 billion photos to the site.
L2 Inc., a benchmarking and education firm that helps members shape their digital roadmap, recently released a study that shows how useful Instagram is to companies focused on eCommerce. Titled “Instagram: User Generated Content,” the report says Instagram has the “highest average order value from social referrals across the major social platforms, with $65 per order.”
User-generated photographs from Instagram are helping marketers build up their site galleries, advertising, emails, PR campaigns and product pages. However, L2’s report finds that many companies are missing the mark. For instance, brands are not using Instagram images on “shoppable pages,” which means they’re missing an opportunity to gain loyalty from consumers and improve their conversion rates.
Facebook acquired Instagram for $1 billion in 2012, leading some critics to scoff at the high price. However, L2’s study indicates that Instagram could be worth 35 times its initial price tag. L2 predicted four years ago that Instagram would be the most powerful social media platform, a prediction that stands as prestige brands today have an average of 500,000 followers on their Instagram accounts.
Companies with a focus on eCommerce that utilize Instagram for marketing have more reasons to rejoice: Instagram has added a “shop now” button, which means consumers can see something, want it and have it, too – all on the same app. Ads on Instagram have been around for almost two years, but Instagram never allowed links that would take a consumer outside of the app. In the absence of said link, eCommerce companies have relied on third parties to provide that functionality.
However, with the “shop now” button, Instagram has lifted the ban on outside links and consumers can easily be that much closer to making a purchase. Thanks to the data eCommerce companies gather through Instagram on their followers, they will have a better idea about how to cater to their consumers.
Another mobile app kingpin, Pinterest, is also getting into the eCommerce game by offering a “buy” button on its app. Pinterest has approximately 70 million monthly active users on around a billion boards where more than 50 billion pins have been placed. The company’s chief executive said recently that Pinterest users want to buy items on the site and that adding buyable pins is an easy and secure way to give users what they want.
eCommerce analysts are now looking at Instagram and Pinterest’s format and trying to decide what impact their more shoppable sites will have on eCommerce giants like Amazon and Google. Meanwhile, brands have new allies for their eCommerce strategies.