How to Use Organic and Paid Instagram Strategies to Maximize Channel ROI

by Leah Spector November 10, 2015
November 10, 2015

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Instagram is quickly replacing Facebook as the advertising channel of choice for small and midsized retailers, with many reporting it as the highest engaged platform as a percentage of audience (some 7x higher, according to experts). And, with more than 400 million active users, Instagram better offers what other social channels attempt to recreate via algorithms: easy-to-discover, authentic content.

Facebook’s acquistion of the platform in 2012 was once considered bold. At the time, Instagram had no revenue and experts were wary about the growing, but still relatively small, social network. But what Instagram did right in its early days –– no algorithm giving preference to user behavior or ad spend –– Facebook’s ownership and subsequent cash flow allowed them to continue.

Instagram didn’t officially offer advertising for brands until 2013, and didn’t open up those advertising options to all brands until 2015. It is safe to say that Instagram’s revenue model has been a slow roll out, first earning user love by avoiding advertising and algorithms and then subtly pushing relevant, platform-specific ads.

Indeed, Instagram walks a thin line, delicately balancing user preference and the need to profit. This has allowed the platform to become a safe-haven from the constantly changing technology and usage best practices of other networks.

Consider the behavior of the Instagram audience, for instance. Users curate their feeds to include a mixture of friends, brands, art and entertainment, often using the social channel as a vehicle to discover new ideas and products from all over the world via hashtags and trending topics. Users engage with content on their feeds, too –– at least more so than they do their Facebook feeds. Instagram has no algorithm for bumping up posts or forcing something into your feed. Instead, users curate their feeds –– and posts show up in reverse-chronological order, meaning if you miss something, you’ll either have to scroll or go directly to that person or brand’s page.

And if there happens to be a brand narrative attached to a post, many users see it as an opportunity for them to learn about something new. In that sense, Instagram users seem to be less jaded and therefore more open-minded than users of other platforms, where banner blindness takes place.

It is this authentic and discoverable environment that gives brands the opportunity to tell their story to a captive audience. Typically, brands in the fashion, beauty, entertainment and home and garden industries have seen the most success on Instagram –– but that’s changing.

In fact, automotive overtook retail in the top three verticals on Instagram, and even the growth of insurance brands on Instagram outpaced the more historically successful verticals, according to Spredfast’s State of Social Report.

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Audi outpaced the auto pack with 2.8 million followers and user generated content strategies to get fans sharing.

So, Instagram is for everyone. It’s where millennials and their younger counterparts converge, and where brands can build engaged audiences for the long-haul. But for those scaling brands just now looking to build a following on Instagram, the common roadblock is in figuring out what will do well, how often to post, what to say, what to hashtag and overall how to use Instagram to generate results similar to those big box brands. After all, Instagram engagement isn’t just about likes and comments. Building relationships and brand loyalty, not to mention driving web traffic and conversions, are the bottom line boosting perks of investing your time and effort to Instagram.

Below are a few best practices you can use to start improving your Instagram presence today.

Make Customer Interactions Actionable

Beautiful content is great, but you also need to ensure you have a community management strategy in place to keep the conversation going. Because Instagram users are more likely to comment, use these interactions as a way to get to know your customers. Brands should keep a close eye on their comment section for valuable feedback or even just an opportunity to get to know a customer.

“It’s not just getting followers; it’s about getting those followers to talk to you,” says Athelia Woolley LeSueur, co-founder and CEO of Shabby Apple, a vintage-style women’s apparel company.

Athelia believes “Instagram is definitely the most effective” channel, and much more profitable than other channels for her clothing brand. Because her smaller community of roughly 87,000 Instagram fans is more likely to care and engage than her 167,000 Facebook fans, she gains direct customer feedback and builds customer relationships that eventually lead to sales.

When followers do start talking to you, she says, make it a habit to respond to each and every comment. If you receive a comment like, “I love this skirt!” take it a step further by responding with something that encourages additional interaction, for instance “Thank you! What kind of event would you wear it to? It’s one of my go-tos for summer weddings!” By continuing the dialogue, you’ll learn more about what the market desires while creating a genuine relationship with a potential customer.

Use Influencer Marketing and Contests to Drive Brand Awareness

Messages are heard a lot more loudly when disseminated by someone people admire, and this is especially true on Instagram. As even this social channel becomes increasingly crowded, it’s important to find ambassadors who will help share your brand with their relevant, usually highly impassioned audiences.

You can leverage influencers in a number of ways, both paid and organic. Try reaching out to some of the most popular Instagram accounts in your vertical to ask if they’ll do a cross-promotional campaign with you –– like teaming up for a joint giveaway or user-generated content contest. Possibilities are endless, but the more creative and mutually beneficial, the more likely they are to participate.

For example, Shabby Apple teamed up with popular blogger A Beautiful Mess to promote the giveaway of a free trip to Palm Springs. To be eligible, users had to follow both Instagram accounts, and to add a virality factor, tag three friends in the comments section. Bonus points were awarded if they commented with which Shabby Apple skirt they would bring, looping in the product aspect to a branded contest.

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Shabby Apple teamed up with popular blogger @abeautifulmess to promote a joint vacation giveaway.

Test for Engagement and ROI

There are many third-party apps and measurement tools to experiment with for Instagram. For starters, use a service like Iconosqaure to get insights into what your audience likes including ideal times to post, your most popular content to-date and even which filters they like best. You can also search trending hashtags, and find the most used hashtags relevant to your brand.

There are also tools that help drive website traffic and conversions. Beauty subscription originator Birchbox uses a tool called ‘have2haveit,’ a service that allows an Instagram user to purchase the latest featured product from the Birchbox feed. Clicking on that link directs users to a product page, where they can purchase and even view additional content related to that product.

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Note: Have2haveit is a third party app that may not be needed anymore now that Instagram advertising is live and supports clickable product photos. However, if you’re serious about driving the most ROI, try testing both options and seeing which gets you best results for the best price.

Instagram Ads: Coming to a Facebook Dashboard Near You

In the past, Instagram has been silo-ed as a brand awareness only play. This was due to the lack of advertising options, clickable photos and only having a bio link out as a way to track any site clickbacks. All of this has now changed.

The recent ad platform rollout has opened Instagram up to millions of businesses of all sizes around the world. With the powerful targeting capabilities of Facebook, and the high engagement perks of Instagram, the new tool marries the best of both platforms with three ad options: images, 30-second videos and carousel ads. Each are clickable posts that include a call-to-action button that allows the advertiser to drive traffic directly to a product or offering, all controlled from your Facebook Power Editor.

“The ability to combine Facebook’s treasure trove of user data and targeting ability with Instagram’s visually driven, highly engaged audience allows marketers to connect with consumers with much greater levels of sophistication,” says Kyle Bunch, managing director of social at marketing agency R/GA. “It enables us to effectively translate our brand story to have the maximum impact with each individual viewer.”

In recent years, Facebook’s content algorithm has made high levels of unpaid engagement near impossible for some brand pages. We may see a similar need for advertising boosts on Instagram soon. While still extremely high overall, engagement as a percent of audience and audience growth rates are already slowing. With 400 million monthly active users and more than 80 million photos posted per day, it is becoming very difficult to get organic growth and engagement on Instagram. This makes the platform ripe for advertising, and Instagram has announced that they are seeing “significant demand” for ads, particularly those in the ecommerce, travel, entertainment and retail industries.

That said, it’s a great idea to test Instagram advertising now while costs are still low. Some reports cite only $ 0.03 per video view, compared to $ 2 on Facebook. With the new ability to target these viewers within highly engaged communities, Instagram’s existing cool factor may just help it out-sell its parent company.

Here’s how to set up Instagram advertising:

  1. Create your photo or video and caption, adhering to Facebook and Instagram policies
  2. Log into Facebook and access the Power Editor in the “Manage Ads” section
  3. Create your campaign, deciding how you want to pay (Buying Type; i.e., Auction) and what the goal of your campaign is (Objective; i.e., Website Traffic)
  4. Name your ad set. Try a name that makes identifying it later easy. For example, If you’re targeting an ad about a skirt to women ages 18 or older, “18+ Female – Skirt – Website Traffic” makes sense.
  5. (Optional): Set a spending limit for your ad campaign. If you set a limit, your ad sets in the campaign will stop once you’ve reached your spending limit. This is the most efficient way to set and forget your ads, analyzing results after everyone has run its course.
  6. Complete the details for the ad by setting your preferences for the campaign schedule, audience (who you’ll target), placement (mobile, desktop, etc.), optimization, pricing and tracking pixels.
  7. Click upload changes to complete your new ad.
  8. Report on results to keep costs down and ROI up. Feel free to tweak an ad if you think it’s underperforming, or A/B test two versions at the same time to optimize.
  9. Note: Be sure to follow rules and best practices as outlined on Instagram’s support center.

In all, Instagram is an engagement powerhouse that is even more relevant to brands now that ads are rolling out. However, don’t forget the best practices of being authentic and real to attract an audience — no matter if you’re earning or paying for eyeballs.

Photo: Instagram Google+ page

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