Recognizing the growing importance of mobile in the consumer purchase cycle, Facebook has brought its retargeting advertising unit, Dynamic Ads, to the photo and video-sharing platform Instagram.
First introduced on Facebook last year under the name Dynamic Product Ads, Dynamic Ads capitalize on what the company called the “mobile intent signals” left behind by consumers when browsing online.
“When someone visits your website or mobile app, then later looks at Instagram, they’ll be served an ad featuring multiple, related products from ones they were browsing on your site or app,” said the company in a post on its Instagram for Business blog.
Dynamic ads enable Instagram’s users to explore and engage with products they care about, said Facebook, and will reach customers with the right product because they are always active.
Personalized jewellery retailer Jewlr is among the earliest Canadian adopters of the Dynamic Ad unit, after seeing success with the unit on Facebook. Its Instagram campaign targeted people in the U.S. who either viewed or added a product to their cart from its website, but failed to complete their purchase.
Jewlr’s Dynamic Ads units ensured that users only saw ads for jewellery products they liked, with the company reporting a three-fold return on its ad investment.
While dynamic ads have been heavily focused on retail and ecommerce, Facebook has also expanded its scope to the travel vertical, enabling advertisers to target customers who have indicated an interest in taking a trip, either by searching for hotel or flight information.
According to eMarketer data, 101 million American adults – approximately 73% of all digital travel researchers – will research a trip via a mobile device this year, with 59.3 million (51.8% of all digital travel bookers) actually booking a trip via mobile.
In a research note, eMarketer principal analyst Debra Aho Williamson said Facebook was putting together a “strong package” of ad products to help marketers retarget customers in near real time.
Williamson cautioned that direct response advertising remains a “work in progress” for Instagram, however, with many marketers regarding it as a branding environment. “It has yet to fully prove itself as mechanism for driving sales,” said Williamson, who said it will be incumbent on Facebook and its advertisers to ensure they have a “solid grasp” on their data.
“Retargeted ads often show products someone has already purchased, or is no longer interested in,” said Williamson. “That’s never a good consumer experience.”
A reported 60% of Instagram users learn about products and services on the photo-sharing app, with 75% saying they take action after being inspired by a post. Facebook said mobile had become a place where people “discover, interact and purchase,” accounting for a reported 50% of retail traffic and 1 in 5 purchases during the 2015 holiday season.
EMarketer is forecasting Instagram to earn $1.3 billion in U.S. mobile ad revenue this year, representing 15.4% of Facebook’s total mobile advertising revenues.
