Instagram is poised to reign as the darling of Facebook Inc. apps, offering a life boat for the core platform during a bout of privacy concerns.
Cowen says the photo-sharing app’s share of digital video budgets from ad buyers will double from 2018 to 2020. In fact, Instagram has grown as the go-to choice for launching new brand campaigns looking to reach ages thirteen to thirty-four, according to 61 per cent of survey respondents to a Cowen study representing about US$14 billion in ad spend.
“Stories” -- a relatively new Instagram feature -- are helping to grow the app into a campaign favorite. Instagram Stories appear “poised for greater adoption” as more ad buyers allocated some portion of their spend to the feature in 2018 than the year prior, said Cowen’s John Blackledge in a note. Instagram even beat out TV in this younger target group, a medium only 3 per cent of respondents said was a primary platform.
The story changes when looking at people thirty-five and up. The survey indicated Facebook’s core platform remains essential for brand agencies targeting the group, which bested both YouTube and Instagram but lagged the old-faithful television. All in all, Cowen sees these trends as growth drivers for the parent company to expand its video content over the next two to three years.
Facebook shares fell as much as 2.4 per cent intraday in New York amid a pullback in the broader market. Cowen lowered its price target on Facebook’s outperform-rated stock to US$184 per share from US$195.