Facebook gains visual, data edge with Instagram deal

Technology PR leaders said Monday that Facebook will acquire a visual marketing tool and consumer data treasure trove when it takes the reins of photo-sharing platform Instagram.

Facebook CEO Mark Zuckerberg said Monday that his company will acquire photo-sharing platform Instagram for $1 billion in cash and shares.

Instagram, which has more than 40 million users, raised a new round of funding recently that brought its value to $500 million.

Zuckerberg said Instagram will remain independent.

“We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience. We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook,” he said, in a Facebook post on the deal. “These and many other features are important parts of the Instagram experience, and we understand that.”

PRWeek contacted a number of industry executives to gain a glimpse at how this acquisition will affect the marketing and communications spaces. A sample of their reactions follows.

David Hargreaves, CEO of Beyond - Facebook's goal is to help brands engage more deeply, with more people, more often. In this context, acquiring Instagram, which really adds a deeper photo function to Facebook, is very logical. Our own research shows that engagement levels on Facebook decline over time, but that images are one of the best ways to drive engagement with fans. Integrating Instagram more deeply into the Facebook experience will help brands create, and pay for, more engaging social experiences using Instagram, and at the same time help drive broader engagement among the more than 850 million users on the platform.

David Armano, EVP of global innovation and integration at Edelman - The acquisition continues the trend we are seeing with other networks such as Pinterest. It takes more than written words to catch people's attention. Instagram's social currency is primarily visual combined with the ability for users to quickly edit and customize. Tighter integration between Instagram and Facebook could lead to even more engagement and attention, leading to a premium when it comes to advertising on either platform. 

While Facebook has clearly stated that Instagram will be kept separate, we don't know exactly what this means on the back end. Facebook clearly has access to data, and with Instagram, it could potentially have access to more data, including location (much of Instagram activity is captured via mobile). Even engagement data could be useful in terms of understanding consumer behavior when it comes to marketing to them. When do they share? How long do they spend browsing visual content. What are they looking at?

Instagram, which was recently made available for Android, also boasts a fairly elegant and functional mobile experience. The same cannot be said for Facebook, which has an inconsistent and often sluggish mobile execution. The acquisition gives Facebook instant access to Instagram talent and intellectual property, which could greatly improve. A better mobile experience for Facebook means more usage, more data, and more relevance to marketers looking to connect to consumers where they spend their time. 

Ben Billingsley, partner at Horn Group - This acquisition makes it even easier for brands to interact with consumers within the Facebook platform. Take a look at the recent campaigns from New York City and Dow Jones that ask people to connect with their brands by capturing and sharing photos of what they love – these are perfect examples of the undeniable shift toward user-generated visuals within marketing. 

At a very basic level, images and videos are clicked on and shared more often than other types of content, and acquisitions like this only make it easier for brands to engage with customers in a direct and interactive way.

Another thing to keep an eye on is the amount of data that's at stake in this deal. The Instagram audience is enormous. It's way too early to tell what exactly could be leveraged, but take the data Facebook already has with the wealth of geo-tagging data Instagram holds, and all of a sudden you're looking at a whole new set of information that could be used to target users in a powerful way.

Susan Butenhoff, president and CEO of Access Communications: It's no secret that sharing photos is one of the most popular pastimes for Facebook users — so purchasing a service like Instagram makes a ton of sense from Facebook's point of view. Aside from the usefulness of the app for purely marketing purposes, many brands find value in Instagram due to its creative and vibrant community of both amateur and professional photographers. Marketers will want to keep a close eye on how that community is impacted by the acquisition — will Facebook continue to nurture and grow it? Or will it go the way of FriendFeed? For savvy marketers, one thing is certain: visual storytelling has taken hold in a big way.

Tracey Thiele, EVP for digital engagement at Zeno Group: With the Instagram app now available on both iOS and Android OS, the adoption rate is expected to increase at a more rapid pace. Facebook could take the opportunity to monetize Instagram much more quickly than Instagram has done. They could also evolve the experience through a deep Facebook integration to be much more Pinterest-like. For marketers and brands, this may mean that we can expect to see similar paid programs, for example a sponsored photo, that Facebook has recently introduced on mobile devices through the app's interface. 

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