Meg Kyte
Reuter
Economics
20 April 2015
Instagram is arguably one of the top social medias and has grown even more so in the last few years since its release. According to statistics from August 2012, which was two years after the launch of the app, there was 80 billion users and four billion images had been shared (Laurent). If you think these numbers are insane, they just keep growing as Instagram’s popularity continues to soar among teenagers and even business people hoping to further promote themselves as well as their product or service such as celebrity makeup or modeling, just as examples. As you can see below, compared to the other popular social medias Twitter and Facebook, Instagram has begun to increase pretty rapidly while the other two actually decrease at an equal or even quicker pace. The consumer tastes have evolved over the years and are directing their attention to the next big thing, which in this case may be Instagram.
The app itself is worth a large sum of money and the value increases while the public’s demand for Instagram and usage also spikes up. At first it wasn’t worth the extensive amount it is now, but when it was first purchased by Facebook it had,”... been acquired by Facebook for more than $730m” (Laurent). The revenue has been increasing, as I mentioned, and the future predictions are highly favorable for the survival of Instagram as a majorly used social media in the United States. Business analysts believe Instagram will continue to soar in the future and its revenue has been expected to hit $5.8 billion by 2020 (Fiegerman).
http://whitehorse.digital/celebrity-endorsement-instagram-the-good-the-bad-the-ugly/
Lately, companies have been having celebrities endorse their products, especially through Instagram, which also shows the increasing popularity of the app. This new revelation has changed things tremendously, not only is this app for sharing personal information and “fun”, but it’s a way to promote, inform and market towards the audience that seems to still be increasing and also interested in what Instagram has to provide. There has most likely been this increased demand for advertisements because of surge of people using instagram and most of these users are young people that will most likely spend the money on the products that are being endorsed by their favorite celebrities and even internet stars.
Not only can normal “celebrities” endorse products, but the development of internet celebrities has influenced how people can make money off Instagram. “New marketing agencies such as the Mobile Media Lab are also popping up to become the go-betweens that connect popular picture snappers with large companies willing to pay for their endorsement... Mobile Media Lab is able to offer an accurate look at just how much money is changing hands these days. They say that represented Instagram users who have more than 100,000 followers can earn $700 to $900 per photo”(Zhang). People can make a large profit by advertising and doing normal activities, by utilizing the Instagram app.
Individuals don’t even have to promote a product, if they make an account that people enjoy and look at, they can be bringing in a huge profit and may even become their job! “On average an Instagrammer that’s got a good 100,000 followers is consistently putting up great photos and their audience really likes what they’re doing can be making between $5,000 and $10,000 a month”(Ellis-Peterson). This would translate to these people potentially “making upwards of $70,000 or even $100,000 a year just on Instagram”(Ellis-Peterson).
It’s inevitable that consumer’s attention will shift onto some improved and newer social media in the future, because this always happens, since we live in a constantly evolving and improving society. As for now, Instagram is at the top for now and may continue to be for quite a few years even, in the future.
Works Cited
Ellis-Peterson, Hannah. "Instagram Users Turn Flash into Cash, as Companies Eye New Advertising Market." The Guardian. The Guardian, 27 Nov. 2014. Web. 20 Apr. 2015.
Laurent, Olivier. "The New Economics of Photojournalism: The Rise of Instagram." British Journal of Photography. 3 Sep. 2012. Web. 20 Apr. 2015.
Smith, Craig. "130 Amazing Instagram Statistics (April 2015)." DMR. DMR, 6 Mar. 2014. Web. 20 Apr. 2015.
Zhang, Michael. "Top Instagram Users Making Thousands Per Photo by Promoting Products." PetaPixel. PetaPixel, 6 Mar. 2015. Web. 20 Apr. 2015.
So many humans these days are on the Instagram and just not have a life, but what people don't get that every time you log in to sites like that people make money out of it and that is why celebrities know that the more pictures equals more money for the company.
ReplyDeleteInstagram is really the only social media I use now. Its the one that fits me the best I guess. I don't need to here everyone's tweet 1000 times a day I just follow people and accounts I like on Instagram and that is how it works. I don't follow any celebrities so the endorsements/advertisements don't bother me to much (which is the way I like it).
ReplyDeleteWow I'm surprised at how much instagram has improved compared to the other social networks. But looking at my own usage with these sites, it makes sense- I use instagram way more. I wonder if Facebook however has had more users in the past before instagram and why instagram is now better than facebook. I also wonder how instagram compares to other things like snapchat and vine. Nice job!
ReplyDeleteI am not surprised with the increasing usage of this app, seeing as it is my only form of social media. What did surprise me was the profit some accounts can bring in by simply posting pictures.
ReplyDeleteI think you picked a great topic due to that many of us have accounts for Instagram. I was aware that every time we log into our accounts the company was making money but I didn't know that they were making millions of dollars. It also surprised me just how much money someone could make off of one photo if they have over 100,000 followers.
ReplyDeleteIt does seem like Instagram in increasing in popularity and especially being a lot of people’s social media preference. The social media shift between facebook, twitter, and instagram is pretty clear because I’ve noticed a lot of celebrities who as of now, never post to their facebook page, sometimes will tweet, but post to instagram all the time. As far as it being somebody’s job, that’s kind of crazy to think about. I understand how people can make a living off of other social media like youtube, because there’s ads before a video and then Youtube can pay the person like .0003 cents per view, but I don’t understand where the instagram money is coming from. The person could get some money from individual promotions and plugs, but how does instagram as a company make a profit? A while ago I watched a video on somebody who makes a living on instagram and all she did was take pictures of her food and her “outfit of the day”s (ootd’s). There was another video about a guy who made his career on snapchat and I don’t understand that either. I don’t like the idea that people can make a lot of money by doing stupid things on social media, but also, good for them. They got really lucky and if I were them, I’d be super happy.
ReplyDeleteI know from experience that Instagram is very popular and people like myself use it multiple times a day. I didn't know that celebrities can make up to $10,000 a month for posting good pictures! That's insane that it is almost like a job to post pictures! All these celebrities are getting paid for their pictures however they aren't the only people making money. What surprised me about instagram is how much the app makes and how much people make off of the app! Great topic it was very relatable because everyone uses or at least knows what instagram is!
ReplyDeleteMaybe not as much as Instagram but a lot of social media sites help newer artist become well known. Without them it becomes much more difficult to get your name out. And even though you might not be using it for this but they can also be usefull in getting more people to attend at a location or buy some type of product.
ReplyDeleteI'm not the biggest fan of instagram. Honestly, I think it's kind of pointless. So you ate lunch today? Great! Good for you! You're literally like every other person in the world, but you actually take the time to take a picture of it! Or you went to the beach, that's totally wonderful! I could go to the beach too, it's not that difficult, just saying. Most people use it as a form of bragging, which is really annoying. But I guess it's useful for celebrities that want their fans to keep up with what they're doing everyday, and it's helpful for companies trying to advertise products. I'm not surprised at all by how many users instagram has. Literally everyone has one, even though I think it's a big waste of time.
ReplyDeleteThere are a lot of people that use Instagram for a lot of things, personal business or anything else, but as time goes on there are some people that don't go on this app as much as when it first came out and was the newest thing in the app store. And some people are waiting for Instagram to update so there are new things that you are able to do on there so it doesn't get boring fast.
ReplyDeleteThat’s crazy! I don’t really use Instagram all that much, I would’ve never guessed it would pass up Twitter and Facebook, especially since Twitter seems so popular. Also, one thing I didn’t really understand is where the money comes from. How can people with a certain amount of followers gain hundreds of dollars from each photo? It makes sense when a celebrity posts something promoting a company or product, because then that company will pay them, but what about the personal pictures? Why do they get paid for that? Where does the money even come from?
ReplyDeleteInstagram is a great way for businesses to advertise themselves and the fact that it is a growing media sight means that more and more people will see that. Using Instagram my self it is no surprise that businesses would want to use it for advertising as it is is a free and easy way to get your company out to the world. Also the fact that is is getting bigger at such a fast rate can really help out businesses in the long run.
ReplyDeleteI never realized just how much money someone can make from a “career” in instagram. I have seen different celebrities put up pictures advertising certain products but it’s crazy to think that that one photo they put up earns them anywhere from $700 to upwards of $900 dollars. The trade off for a celebrity of taking the thirty seconds to put up a picture of a product in return for 700 dollars is certainly one many people would be willing to make. I agree with you that sooner or later consumer tastes will change and the focus will shift to some sort of new social media but for now people will continue to earn crazy amounts of money from pictures.
ReplyDeletePersonally Instagram and twitter are the only social media I use. I am not surprised that its popularity has continued to grow since it was released. It makes complete sense that it is now a great way to advertise products. Companies and celebrities are really taking advantage of it. Its crazy that someone could make a living off being an Instagramer.
ReplyDeleteInstagram has definitely changed the game of market advertising strategies since its release. It has opened up so many doors and opportunities for both big businesses and young entrepreneurs to showcase their goods and services to the public through a simple app. Smart entrepreneurs have combined their resources to feed on people's wants through this social media, and have used Instagram almost as a type of capital for selling their products. Celebrity endorsements have sufficiently increased in popularity as well. It's like a modern free market economy where businesses and celebrities make negotiations in order to offer goods to the public, who, in return, will spend their money. In addition, young people can now purchase complement goods, like apps for tracking or gaining Instagram followers. Overall, this system has definitely stimulated the economy over the last few years, bringing in tons of revenue for small businesses and large corporations alike.
ReplyDeleteIt's amazing how many job opportunities have opened up to others ever since the boom in popularity of internet usage, allowing popular individuals on websites such as youtube, or in this case instagram to make profit off of providing content which they themselves have created. However with more and more individual's using these websites a source of income, it bears the question of whether some type of countries's government or other global power will step in and try to place restrictions on the pay which this individuals receive.
ReplyDeleteThis was a very interesting article to read. I did not know that Instagram made so much profits, even though it is a free app. I like how you mentioned how businesses have been starting to promote their businesses and products on Instagram. Personally, I believe this is a very good strategy. There are thousands of people, especially teenagers, who use Instagram on a regular basis. If they promote their products on there, it will defiantly increase the demand for the products. They will gain more profit, just by doing a different type of advertising. It does not suprise me that Instagram is gaining more popularity than Facebook or Twitter. Pictures and posts are the new things. Not updates statuses or tweets. Its good businesses are using this to their advantage.
ReplyDeleteThis was a really interesting post, I did not realize that Instagram was so popular and also being used to endorse different products. I can see how using social media could really increase profits for companies. I wonder how much more profit these companies are making due to the endorsement of various celebrities? It would be interesting to compare. Interesting article, nice job!
ReplyDeleteI really liked this article! I think that the idea of people's job being "instagram" is really cool. I really don't use facebook or twitter any more, mainly instagram. I agree with Kennedi, businesses using instagram to promote their products is a really smart move. Personally I am worried that the site will become to commercialized if all businesses use this technique.
ReplyDeleteI thought your topic was very relevant to today’s society. I always see people on Instagram at school, right after school, and basically everywhere I go which shows it’s growing popularity. Personally, I have an Instagram and I use it every day. It is a great way to stay in touch with people. I was surprised to hear that you can get paid from getting more than 100,000 followers. This will really encourage people to get more followers, but it can also be dangerous to have so many people that you don’t know seeing your pictures. Great article!
ReplyDeleteInstagram is one of the main things. I always I go on it even more than Facebook now a days. When my roommate asked me oh do you have a twitter and a Instagram I was like yah. But the complexity of social media has change to an extreme over the past years. I always am attracted to the newest things with social media. So it is obvious why social media has made impacts on everyone's life.
ReplyDeleteI never knew that Instagram was actually that popular. I knew that pretty much every celebrity had an Instagram, but I never really thought about how many pictures are actually posted to the app. It’s also interesting to think that everyday people are able use the same social media as celebrities and have the same results and allows you to comment with those posts of the celebrities.
ReplyDeleteI love how this is such a relevant topic and I go on Instagram even more then Facebook these days. It's so true that celebrities and businesses use Instagram for advertising of products and this has become super popular. It'll be interesting to see if it'll continue to grow or if the social media will change to something else again.
ReplyDeleteI liked your topic choice! Your use of social media is easy to relate to and it made your article an interesting read. I didn't realize how many celebrities were using instagram to promote products. I had no idea that you could get paid for having a certain number of followers! I use my instagram everyday and I love seeing what everyone posts and staying in touch with my friends from Michigan. It is interesting to see how social media relates to economics in our everyday lives. Thank you for sharing!
ReplyDeleteGreat job incorporating a social media and economics! I really enjoyed how you included visuals. It is interesting how a free app can really help the economy because there's advertisements through pictures and sometimes you can pay to get followers -- crazy! I think you may need a few more vocabulary words, but other than that, great job!
ReplyDeleteYour topic choice was great! It's so relevant to today's culture. I check Instagram every day, and I've never thought about the economic impact of it, but your article sheds some light on it. It makes sense that celebrities make a profit by promoting products, and the demand for those products definitely go up if we see them using it. It's an interesting way to think about something we do daily. Great article!
ReplyDeleteGreat idea!! It's crazy how popular Instagram has gotten over the years. Like any company it's trying to find new ways to keep customers interested and using their product. They achieve this through adding new filters every few months. It's a combination of facebook and twitter which is why I think it has been able to stick around so long. If instagram wouldn't have let facebook acquire it I wonder if it would have increased so drastically without having a big name like facebook behind it.
ReplyDeleteMeg,
ReplyDeleteThis is a very great topic that brings up a great idea for economics. Its insane how much this company has brought it over the year and how much it has been growing and how much it is still growing. Facebook use to be the company to beat and now Instagram is starting to replace it and come up behind it because, its starting to appeal to the younger people of this world. Its insane how much it brings in money.
Instagram has gotten insanely popular over the past couple years. They are always updating the program finding new ways to suck in new users. It seems like all social media sites are linked together in some way, with the Login with Facebook feature, or the login with twitter feature, allowing users to share the pictures they post on instagram all over twitter and facebook.
ReplyDeleteCool topic! I definitely wouldn't doubt it if someone told me that Instagram is the most popular application used today. Just about every user wants to share everything they do on a daily basis through uploading pictures to this icon...sometimes sharing too much. As I have an Instagram account, I never really thought of it as an economic factor. Great topic to do as it's so relevant to just about everyone in the society!
ReplyDeleteI realized that Facebook and Twitter weren't as popular as they were a few years ago, but I didn't think to relate that to the creation of Instagram. It's rapid popularity will probably only increase as people who only have twitter and/or facebook transfer over to the newest social media craze. It's insane that there is such a following on Instagram that people can actually make money from just posting pictures. With a job like that, it's a surprise that there actually isn't more demand for it. It seems like a job that a lot of people would want because it is so easy. Of course, they would have to work to get that following but that doesn't even seem like such a compromise if the result is $700-$900 for one picture.
ReplyDeleteThis is a very good topic considering the amount of people that are on Instagram. I, myself, am on Instagram and follow a few celebrities who do promote products as an ad. Instagram is a great place for people to communicate new trends with one another to get their business going. Facebook use to be the place to go but as we hear about better social media sites, such as Instagram, we use less of Facebook to look for something new and more entertaining that catches our eye. Instagram is growing everyday which makes it a great place to go to have sponsored ads for young adults and teens looking for the latest trends.
ReplyDeleteI like how you talk about instagram compared to other social media sites. It would be cool to see the predictions of where it is going and how much money the makers of the app will collect as the number of downloads increase. People don't realize how much these apps can make just from having free downloads and it is crazy to see how much they do make from it.
ReplyDeleteMeg, I enjoyed this article but I did not know that Instagram made so much profits, even though it's a free app that anyone could get. I liked how you mentioned how a few businesses have been starting to promote their companies and/or products on Instagram. This strategy is a smart one to use for other promotions, sales, and other aspects for other companies. There are probably thousands to millions of people, especially teenagers, who use Instagram on a daily basis, to see what their friends are up to or to post themselves. If other businesses promote their products on this app, it would defiantly increase the demand for their products. They will gain more profit, just by doing a different type of advertising. It does not surprise me that Instagram is gaining more popularity than Facebook or Twitter, because they are "old" social media that teenagers don't use anymore because they want the new and improved. Pictures and posts are the new things. Not updates statuses or tweets. Overall, I was surprised that Instagram made that much and had that much popularity to their name.
ReplyDeleteIt's true Instagram is used by most of the teenage population. Thats how Facebook gets such a high revenue from this product because it is targeted at teens who have money and no care with what they do with it, plus they are always talking and wanting to keep in touch with each other making Instagram the perfect money maker. Since other companies also use instagram in order to sell their product it makes a lot of money for all companies involved on instagram. Now is marginal benefit for instagram good or bad? I would say since mostly kids use it they are doing or posting inappropriate things there for making the marginal benefit on the bad end of the spectrum. Now the company would say that this is a negative externality that they can deal with so not hurting their marginal benefit. What do you think?
ReplyDeleteYour topic choice was great! I do agree that Instagram is the top social media app in the world or at least the most growing app in the past year when it really gained its popularity. Simple things such as an app that millions of people use everyday has such a huge connection to economics. The pay that you mentioned that folks may get from a single post is ridiculous. Some people don't even make this much revenue with having a more realistic job. I do think that most of the money Instagram makes is from normal people, like us, that want to purchase the same products out favorite celebrities or makeup artists may have. Furthermore, if Instagram keeps up at the fast paced rate of users and posts, the revenue will most definitely be more than $5 billion by 2020. Overall great topic that relates to today's society and young adults.
ReplyDeleteInstagram is indeed a very powerful and popular platform. Because it is owned by Facebook, it is hard to say whether Facebook is hurting at all, however Facebook makes most of its revenue off of ads and I suppose the less the number of people using it's own service, the less money it makes. They still have millions of active users though, so it'll be alright.
ReplyDeleteIt didn’t realize that Instagram has been around since 2010, but that’s probably because they had to build up a base before they became popular. I also didn’t know that Instagram was purchased by Facebook. It’s lucky for Facebook that they picked up Instagram when they did because as Facebook becomes less popular, Instagram becomes more and more popular - which probably helps them balance out their revenue rather than seeing a drop in profits. I never really thought that Instagram could be used to generate a profit, but it makes sense that endorsed celebrities would make money for promoting a product. I’m kind of confused by how unaffiliated people make money - who pays them?, other than that nice blog post Meg!
ReplyDeleteIt's weird to see how much Instagram has grown in just 1 year form 17% to 30% and to keep growing while Facebook and Twitter keep declining is amazing for an app that is all about pictures. It is also weird to find out that people on Instagram can make a profit off of it from $700 to $900 per picture and $10,000 a month is fascinating .
ReplyDeleteI've been in the world of Instagram since just last summer, and I could tell from the beginning that this was going to make Facebook look like MySpace. It's a pretty cool application and honestly a confidence booster when you get a lot of followers and likes/comments! I'm going to have to step up my game and start earning money from this! But something I'm wondering is what the Facebook and Twitter bosses have to say about this. Are they planning a comeback to redeem themselves from this change in media interest? Should we be expecting any big changes? I didn't know that people could make money getting that many followers honestly, and I think that that's one of the reasons that so many people like it! Very informative article!
ReplyDeleteI'm still amazed at just how much people make off social media. Some YouTubers will make a 6 figure salary off YouTube alone. I think isn't nearly as stable as YouTube has been. Instagram will face its fall much like Facebook (the company that own Instagram). When Instagram starts to use ads more regularly and when seeing ads becomes part of the regular experience Instagram will lose popularity fast.
ReplyDeleteI definitely agree that instagram is the most popular social media these days as facebook has been overrun. With what has facebook been overrun with? Why old people of course. If it’s one thing that kids these days aspire to its privacy and they can’t have that if there are their parents breathing down their neck. It is true that a new technology will be unveiled and then that would be the next big thing but the infestation of parents will help to accelerate it.
ReplyDeleteMy question is how does the actual company Instagram make money itself. Usage is free and when I use it I never see advertisements pop up or anything so there must be sponsored pages. Either way, there is certainly a great consumer demand for the product that makes it very profitable should they choose to sell the company.
ReplyDeleteI am not an avid user of instagram myself but none of this information really shocked me, especially the amount of revenue someone can bring it just by advertising products. It’s almost like large youtube channels that don’t even stream ads but somehow manage to bring in money because larger companies will see their popularity as a profitable gain. Overall I think that Instagram is a perfect model for future businesses because ads can become overwhelming and overbearing to users that end up seeing the same ad over and over again which could drive customers away from that product instead of gain interest in it.
ReplyDeleteI agree with Brad Wahlgren. How these social media sites make so much money is just out of this world. I know advertisements but there has to be a lot more to it. Instagram doesn't even have ads, they might have sponsored pictures but even then I don't see how that could be all the revenue and still be successful. With regard Instagram being the most popular, I think Twitter is used by a lot more just because it has many more capabilities. You can post pictures just like Instagram and post when you don't have a picture. I don't see Instagram taking over social media.
ReplyDeleteIt is crazy to see that Instagram has surpassed Twitter and Facebook. How do they calculate what the app is worth? Does the app make money itself? Do people pay Instagram for anything? Or do companies pay a lot of money to Instagram to have their product promoted on there and that is how they make their money?
ReplyDeleteInstagram has become a very popular social media app it doesn't surprise me that Instagram has 80 billion users and is surpassing Facebook and Twitter. I think its super cool that some people can have a job just by posting on Instagram and get $10,000 a month. My only question is how does Instagram itself actually make money?
ReplyDelete