...to be driven by innovations in AI targeting and Reels monetisation
Instagram is recovering faster than its social media counterparts, despite the adoption of Apple's App Tracking Transparency (ATT) policy in 2021 and a consequent weakening of the digital ad market. according to WARC Media, the most rigorous and accurate benchmarks for media planning and strategy in the world.
The media and marketing intelligence firm predicts that Instagram's advertising income will reach $71 billion by 2024, thanks to parent company Meta's use of AI to aid in content recommendation and advertising automation processes, as well as enhanced monetisation of Reels, the company's short-form video product.
Alex Brownsell, Head of Content, WARC Media, says: “The recovery of Meta’s ad business in 2023 has been one of the most notable media industry stories of the year. Twelve months ago, commentators were warning of a “reckoning” for Big Tech with platforms like Instagram hurting from signal loss resulting from Apple’s ATT policy, alongside a broader slowdown in digital ad investment.
“What a difference a year makes. Buoyed by innovations in AI targeting helping it to offset the impact of ATT and improved monetisation of Reels, it is only a matter of time before Instagram surpasses its Meta stable mate Facebook to become the world’s largest social media platform by ad revenue.”
Providing evidence-based insights on the challenges and opportunities Instagram has to offer, WARC Media’s latest Platform Insights report provides an overview of the key datapoints that advertisers need to know about the platform spanning investment, consumption and performance.
WARC Media forecasts quarterly advertising revenues of $17.7bn in Q4 2023, up 25.8% year-on-year, and predicts its global ad revenue to reach $71bn in 2024.
Instagram has recovered strongly following a largely flat 2022 as a result of Apple’s App Tracking Transparency (ATT) policy, alongside a broader slowdown in digital ad investment.
Buoyed by innovations in AI targeting to boost consumption levels, spanning content recommendation and asset creation, and improved monetisation of Reels, WARC Media forecasts Instagram to post quarterly advertising revenues in Q4 2023 of $17.7bn, up 25.8% year-on-year, and reach a total of $71bn in 2024.
The growing popularity of social commerce is moving Instagram closer to the point of purchase. The global retail category spend on Instagram will rise from $3.2bn in 2020 to a forecasted $9.1bn in 2024 per WARC Media. Ahead of retail spend, business and industrial ad spend is expected to reach $10.2bn globally, whilst other categories have modest growth.
With its current growth rate, Instagram will soon overtake Facebook as the world's top social media network by ad income.
Reels campaigns reach roughly twice as many people as TikTok campaigns. When looking for brands, over a third (30.4%) of consumers use Instagram.
According to Kepios, Instagram's worldwide monthly advertising reach has remained stable at 1.3 billion over the last two years, slightly ahead of TikTok.
However, Meta's 2020 move to short-form video with Reels is proving successful with users and sponsors alike, with daily plays already topping 200 billion across Meta products.
According to Emplifi data, campaigns running on Reels will reach nearly twice as many people than those running on TikTok. Reels surpassed all other content categories on Instagram, according to Emplifi, producing 55% more interactions than single image posts and 29% more engagements than normal video posts.
According to GWI, over one-third (30.4%) of customers use Instagram to find companies and campaigns.
Instagram's usage among Gen Z and Millennials has surged in the last year, thanks in part to its push into Reels, reaching 60% of younger audiences, ahead of TikTok (38% and Facebook (38%, respectively).
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