Instagram is quickly becoming the most effective tool on the internet for brands that are looking to take their marketing efforts to the next level. According to a recent AdWeek article, Instagram is projected to bring in $1.6 billion in ad sales in 2016, and $2 billion by 2017. It’s no secret that brands across all industries are looking toward Instagram as the next big thing in digital marketing. But many brands are asking the same overarching question:
What’s more effective: influencer marketing or Instagram sponsored ads?
To answer this difficult question, it’s important to develop a strong understanding of what both of these tools bring to the table. Instagram sponsored ads are designed specifically to be inserted between real user posts on a feed. The intention is to create brand awareness without coming off as a blatant advertisement. In many ways, Instagram sponsored ads are similar to advertorials, which cleverly disguise advertisements as journalistic pieces. (For more information, see Digiday’s article on “Native Ads or Advertorials?“).
Yes, Instagram sponsored ads can boost awareness and get a brand’s name out there, but just how well are they really going over with users?
Apparently not so well. According to an article published yesterday on VentureBeat, a recent survey of 974 Instagram users saw that 41.4% were unhappy that ads were now being incorporated into their feeds. Even if Instagram sponsored ads are a bit different than the status quo, they’re still ads, which most people feel negatively about.
This is the main reason why, in many respects, influencer marketing is almost always going to be the more effective of the two tools.
With influencer marketing, brands and their products are highlighted and organically integrated by top social media stars. (See our dedicated resource guide here for top social media influencers across YouTube, Instagram, Snapchat, and more) These stars have extremely wide-ranging audiences who engage with and truly identify with them.
Bringing influencer marketing into the picture means increasing not only brand awareness, but also brand affinity — an even more important factor in building and maintaining an engaged consumer base. Furthermore, marketing with social media stars provides a critical level of relevancy and relatable nature that is most oftentimes missing with outright ads.
Another important element to take into consideration is cost. There isn’t a set rate card for Instagram sponsored ads but, according to executive feedback in this Ad Age article “Monthly Cost Of An Instagram Ad Campaign Can Approach $1M,” figures can range between $350,000 and $1 million per month for a high-level, effective campaign. This is undeniably high in comparison to the costs incurred when searching for the right influencer to partner with (see our post “How To Find Instagram Influencers“), and the return on investment with the latter will typically be much higher than simply relying on Instagram sponsored ads alone.
So, what’s the best route to take?
Instagram sponsored ads shouldn’t be ruled out entirely. They can be quite useful when combined with other efforts. Compared against influencer marketing, however, Instagram sponsored ads don’t hold a candle in terms of efficacy and cost/benefit analysis. Users simply aren’t at the point yet where they’re going to take well to ads in their news feeds (for a more in-depth look at this assessment, please reference VentureBeat’s survey article “More Than 50% Of Instagram’s Biggest Fans Hate Ad Increase”). It’s no wonder why some of the world’s top brands (see our post “Best Brands On Instagram Marketing With Social Media Influencers“) are moving toward influencer marketing, and why this is far more than just a passing trend.