Instagram makes E-Commerce push with new tools for businesses

Instagram has taken new steps to bolster its position as a major mobile advertising player.

On Tuesday, the Facebook owned photo-and-video sharing service unveiled new features to make it easier for businesses to analyze and run ad campaigns through its mobile app. The new “InstagramBusiness Tools” allow companies to view post engagement and performance metrics across all content and to promote posts directly within the mobile app with the goal of reaching more customers. Instagram also launched “Business profiles” for the first time to allow users to talk to companies via the app. The features highlight Instagram’s focus on attracting more small businesses to the platform and on making its advertising service mobile-first.

“We built [the tools] for a smaller business, but we think that larger businesses will use these tools when they’re on the go,” Quarles said. “This is useful for businesses of all sizes.”

Since Instagram ran its first ad in late 2013, advertising has exploded on the platform. The app now boasts 200,000 marketers who have access to 400 million monthly active users, a hot bed of millennials with smartphones. The service continues to make up a growing slice of Facebook’s overall advertising business. This year, nearly 10% of Facebook’s global mobile ad revenue and 20% of Facebook’s U.S. ad revenue will come from Instagram, according to forecasting firm eMarketer; and by 2017, Instagram’s share will grow to 14% globally and 28% in the U.S. Instagram is expected to have mobile ad sales of $1.3 billion in the U.S. and $1.53 billion worldwide, eMarketer said.

“Why would a small business want to grow on Instagram?” Quarles said. “It’s two things: The visual nature where you can express experience and personality, and then there’s the interest graph of what people’s passions are. It’s the ability to put something visually striking in front of the right person.”

The new features were the result of hundreds of interviews with businesses and were built to help companies stand out, understand how posts resonate with users and reach new customers, Instagram’s global head of business and brand development James Quarles said in an interview. ”Business profiles,” which are free to companies and can be viewed within the mobile app, allow users to use a “contact” button to quickly call, text, email or get directions to a company. Quarles said Instagram created the feature in response to feedback from companies that it was challenging to sift through comments on Instagram where users often post questions.

Similarly, the insights tool, which includes metrics such as impressions, reach, website clicks and data on followers, was launched to meet businesses’ need for simple stats about their posts and audience to inform how they run ad campaigns. The new tools also let businesses quickly promote posts that have already been shared on the app. A furniture company, for example, could promote a post that already performed well organically. The company can launch the campaign fully within the app, which lets businesses set a budget, target audience, duration for the campaign and add a “mobile action” button such as a website link. The new tools roll out in the U.S., Australia and New Zealand in the coming months and will be available globally by the end of this year, the company said.

“More diverse ads and businesses drive more relevant experiences for people,” Quarles said, noting that as more businesses join Instagram, users will have a better experience consuming ads. “We want ads that are just as engaging as the rest of posts in feed. Small businesses are great creators.”

Instagram’s video and multiple-image carousel ads are increasingly popular among marketers, and the platform continue to add new formats. Earlier this month, Facebook debuted its popular retargeting ads, called “Dynamic Ads,” on Instagram. About 60% of Instagram users say they learn about products and services on Instagram, and 75% say they take an action after seeing an Instagram post, such as visiting a website, searching for a product or talking about a product with a friend, according to Facebook.

Recently, Instagram redesigned its icon to feature a simpler camera and rainbow theme and updated its app to offer a cleaner viewing experience for browsing photos and videos. In March,Instagram announced that it plans to launch an algorithmic feed that will prioritize content users will find to be the most interesting and relevant.