After several days of rumors, Facebook announced today it will be adding video sharing capabilities to its growing photo sharing application Instagram.
This news should prove to be exciting to Instagram’s growing, loyal user base. Since purchasing Instagram last year, the Facebook-owned app has flourished. According to a recent SimplyMeasured study, user adoption has jumped 600% in just a year, growing from 22 million active monthly users to nearly 130 million monthly active users. This data shows users value an easy-to-use channel for sharing and viewing personal "moments" within their social network. It is likely that users will show the same desire and affinity towards sharing video clips ranging from their vacations, travel, sporting events within their social network.
But brands have just as much of a reason to be excited. Since the Facebook acquisition, brand adoption on Instagram has also skyrocketed, according to SimplyMeasured’s study of 100 leading brands. According to the study, 67% of the top 100 brands now on Instagram as of May 1, 2013. This number jumped an impressive 14% from February 1, making it the fastest growing social network for brands this quarter. As user engagement and photo sharing increases on Instagram, marketers will be keeping a close eye on engagement with video. As video has proven to be the most engaging form of media, brands may take an advantage of an opportunity to share videos on Instagram as well.
Even more interesting is how adding video sharing to Instagram could fit into Facebook's broader business strategy. Facebook has long discussed the importance of video sharing and is likely to formally introduce to its advertisers this fall. But what could video on Instagram mean for marketers? While Facebook has held off on introducing ads on Instagram, today’s product launch suggests it may be heading in this direction in the future. Video is likely to increase engagement and sharing amongst brands and Instagram users, a key component of advertising today on Facebook. And, if Facebook does provide advertisers with access to Instagram user data, what ad formats would they make available? Could videos eventually serve pre or post-roll ad units? Could Facebook allow brands to suggest videos to Instagram users based on audience data provided through Facebook? Could Instagram be another publisher added to Facebook’s Ad Exchange? Only the future can tell.
With video sharing, Instagram may also capture user market share from YouTube, the world’s second largest search engine. It will be interesting to see how app user and visitor trends fluctuate with both Vine and YouTube due to this new capability on Instagram.