Back in 2012 Facebook spent a whopping $1 billion to acquire Instagram but what exactly is Facebook going to do to ensure the investment pays off? Yes, owning the best thing since sliced bread is good in itself, but is it making the shareholders happy?
Well with the addition of video on Instagram, online video advertising will surely be the golden ticket, however did Facebook need Instagram as part of the it's video strategy? According to Topeka Capital Markets analyst Victor Anthony, "The 15-second time limit coincides with what we have heard is the exact length of time for Facebook's planned launch of auto-play video ads, leading us to conclude that video ads on Instagram are on the come." He went on to add: "Video ads on both Facebook and Instagram position Facebook, as a whole, to capture a meaningful slice of traditional media ad budgets."
As an active Instagram user I believe advertising on the platform has potential however there are some good and bad points. Firstly from a marketing perspective it will be awesome for businesses looking to capture Instagram users and will help Facebook to achieve a return. However at the same time there shouldn't be too much advertising, which may lead to users leaving the platform. They must find a good balance between ads and actual content. This goes the same for auto-playing video ads on Facebook.
What do you think Facebook have got planned for Instagram?