Instagram is talking with advertisers about IGTV, the first steps toward turning the fledgling video service into a moneymaking opportunity for both it and its homegrown stars and publishers.
In recent weeks, several advertising executives, speaking on condition of anonymity, say that Instagram has been slowly opening up about the potential to buy ads on IGTV, which debuted last year with longer video programs from internet celebrities like Lele Pons. IGTV is a standalone app and the shows are available on Instagram, too.
Instagram acknowledged it was exploring ways to support creators, including through ad programs, but would not discuss specifics. It's unclear when the ad opportunity will roll out, but advertisers say they expect to see it in the coming months.
"While ads are not currently a part of IGTV, we are exploring ways to help creators monetize," an Instagram spokeswoman wrote in an email statement. "Just like our thoughtful approach to introducing ads in feed and Stories, we are taking our time to evaluate different monetization strategies in order to ensure we roll out features that are best for businesses and our community."
Creators are typically the most active users and they post original photos and videos to often massive fan bases. Pons, for instance, has 33.9 million followers.
Facebook, which owns Instagram, has yet to share audience stats around IGTV, and some advertisers say the company won't even share that data with them. "While views are increasing on IGTV," one of the advertisers says, who spoke on condition of anonymity, they haven't increased the way Facebook hoped. It's not the momentum they were looking for."
The service could be hamstrung in part because it lacks a clear path to revenue for the creators and publishers, many of whom already devote their limited time and resources to the popular Instagram Stories section. Facebook and Instagram compete with Snapchat, YouTube and even Amazon-owned Twitch for top talent who can help keep audiences and advertisers glued to their services. Snapchat, in particular, has been trying to cater to its creator community more as of late, hooking them up with brands and introducing new ways to make videos and ad revenue from those videos.
Ads take a number of forms on Instagram already. Creators make money from entering into brand deals, where they promote a product with full disclosure to the audience through Instagram's "branded content" tools that apply to the Instagram feed environment and Stories, the 24-hour disappearing videos.
In IGTV, advertisers have been known to work with publishers posting there, but there's no formal "branded content" offering. Advertisers familiar with the talks around IGTV say that the ad product will likely be similar to branded content.
"Instagram is saying we can sponsor a series," says one digital ad agency executive, who spoke on condition of anonymity. "So, brands could integrate into a show, and get a shoutout from the star."
IGTV is also considering ad breaks, like the ones that appear in Watch, Facebook's video service. Like YouTube, Watch offers publishers and creators a split on ad revenue from commercials, and Facebook gives the partners 55 percent.
Another agency executive, also speaking on condition of anonymity, says that Facebook has been raising IGTV alongside Watch during talks with brands and advertisers in the Newfronts season, the time of year that all the major digital players present their best content to land big-money ad deals akin to the TV upfronts.
"They are putting a lot of emphasis on IGTV as a YouTube competitor," the agency exec says.