Facebook's photo-sharing application Instagram is unveiling tools to help businesses differentiate themselves from regular users in a bid to help drive advertising revenue.
Instagram, which has been heralded by analysts as a key source of growth for Facebook, will now let businesses create special profiles that will allow customers to contact them directly rather than posting public comments. Instagram will also offer business users new data on which posts are getting the most engagement and give them the ability to turn posts into advertisements.
"We now have more than 200,000 advertisers on Instagram -- the vast majority of them are small businesses," said Marne Levine, Instagram's chief operating officer, in an interview at the company's Toronto office. "We want to help them stand out to their customers more."
Facebook is working to leverage Instagram's 400 million monthly users to keep up its pace of revenue growth. Instagram ads are expected to bring in $1.53 billion in revenue in 2016, or 15% of Facebook's total ad sales, according to eMarketer. Instagram has 8.5 million users in Canada, Levine said.
The new features are similar to tools on Facebook and Twitter, which allow users to pay the social networks to promote specific posts. Businesses on Facebook can build profiles that help them handle customer service complaints and share information online.
Instagram is still early in its efforts to increase revenue, Levine said.
"Two years ago we had just started to introduce advertising," she said. "We're five years old. So if you know any 5-year-olds, they're just getting started."
-- Bloomberg News