Instagram Rolling Out Ads For All Gives Weight To Twitter 'Dumb Pipe' Jibe

If this afternoon's big national news today is the Queen becoming the longest-reigning monarch as Apple prepares to launch a new iOS and almost certainly a new iPhone and revamped Apple TV, this morning's big news for marketers has to be that Instagram is open for business. It's a big opportunity that begs the question -- where exactly is Twitter in all of this exciting 'mobile first' type of news?

Eyebrows may have been raised when Facebook forked out a billion dollars to buy Instagram back in 2012, but the point is the social media giant has a history of seeing specialists in a particular area who are gaining traction (such as WhatsApp in messaging) and buying them, even though they offer services that can be found on Facebook. As a separate platform, however, Facebook covers itself if new Internet users don't want to be seen on the same site as their parents as well as offering a different environment to attract social advertising dollars not earmarked for Facebook.

Like me, you've probably been waiting for advertising to be fully unleashed on Instagram to keep endless sepia-toned pictures of get-togethers and overly orange picture of sunsets company. The interesting thing is that nearly every start-up in retail I ever chat to or see quoted truly rates the site for allowing them to show off their wares as well as get a very good idea of what's -- as people now say -- "on trend." Just this morning the BBC were interviewing start-ups at a Christmas fair where buyers can see what they should be stocking in the coming months. I think Facebook might have got a single mention, but Instagram was mentioned every time. If you want to show off an item you're retailing and if you want to see what people are liking from other retailers, clearly Instagram is proving a very worthwhile channel.

Furniture retailer has been quoted this morning as claiming that when it trialled Instagram advertising, it saw a 10% increase in order size among those who had seen the ad.

Which begs the question: Where on earth is Twitter in all of this? The channel so loved by tech and media-oriented professionals didn't get a mention this morning by start-up retailers, and I can't remember the last time I saw any positive news about the service, which seemed to have everything going for it when it floated with a $14bn valuation nearly two years ago. It has since halved in value, has never turned a profit and appears to be scratching its head as to how to make money from its massive audience. No wonder, then, that a boutique investment bank had the guts to come out and call it like it potentially is, warning the channel is at risk of becoming "a dumb pipe" used for others to gain attention but with no clear monetisation momentum itself. 

Although it may not have been popular at the time, Facebook has shown how you can monetise a site by curtailing organic reach from brands and offering ad units within a user's news feed. Now its sister site is showing how large, sponsored pictures can do the same on another site. Twitter would undoubtedly attract criticism if it followed suit but having halved in value in the last two years and with no clear turnaround plan publicly announced, it's hard to see the site has much choice other than to sell timeline advertising slots. 

The month ahead will be a very interesting one for Instagram as early markets, including the UK, are joined by regions across the world as the advertising rollout goes global by the end of September. The same cannot be said for Twitter as its co-founder, Jack Dorsey, searches for a new CEO to turn eyeballs into profit and start paying back on the good faith investors rushed to show just under two years ago. 

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