The Newsstand Winter 2023

Instagram Ad Reach is on the Rise in 2022

Wherever you are in your entrepreneurial journey, navigating Instagram ads can be difficult – especially considering the variety of advertising channels offered by the platform. Ad reach on the platform has been on the rise with an estimated 21% increase in 2022, but knowing which ad formats have the greatest reach can be an important way to optimize your online marketing. Below we summarize the ad reach performance and cost of Instagram’s feed posts, reels, and stories in 2022. 

Feed Post 

Instagram’s “home feed” presents potentially the greatest ad reach of the three ad environments, reaching 96.6% of Instagram’s active user base each month.  Product feed posts are great for business accounts to develop a personal brand. Having a strong feed can naturally lure customers into purchasing a product. However, paying an influencer to promote a feed post is generally the most costly option and often does not have justifiable reach. The Business of Apps influencer marketing costs report shows that a feed post is well over twice the cost of a story post and although Feeds get the greatest reach stories are not far behind. 

Stories 

In 2022, Stories ads were reported to reach as many as 1.07 billion users, a reach which makes up 72.6% of the active user base. Story posts have notably high reach, and hiring an influencer to post a story can be shockingly affordable. Many influencers will exchange a story post for a product and won’t require additional payment. Depending on the product, this could be an affordable way to generate ads that reach lots of people. 

Reels 

While Instagram reels haven’t built up quite as much reach as Stories yet, they are expanding rapidly, and likewise, so is their reach. In 2022 they were reported to be able to reach 675.3 million users with Reels ad reach making up 45.7% of instagram’s total potential advertising reach. However, the main advantage of reels is its ability to attract increasingly diverse audiences. Reels are generally the best Instagram ad channel to get your product seen by the greatest demographic variety. By creating content that showcases the artistic process, people can feel a stronger connection to the creator, which could lead to a higher conversion rate. 

General Pointers for Your Content Strategy

For any business, Instagram is an incredibly powerful tool. A combination of insourcing and outsourcing content could help build your personal brand and optimize your reach. Feed posts are great to insource, stories are especially great to outsource, and reels can be fairly effective in either case. 

Social Media Use On the Rise, Per Click Engagement On the Fall

Global internet usage continues to increase, and likewise so does social media usage. According to Datareportal’s Digital 2022: Global Overview Report, social media use is increasing both by number of users and in hours spent per user. In the past year the number of global social media users has grown by more than 10%, with 4.62 billion social media users reported in January 2022. 

Yet, as people spend more time online, reports have shown a drop in ad engagement. For example, Facebook pages now expect an average engagement rate of just 0.07%. This means that for every 10,000 users, only 7 will react to, comment on, or share any given post. Keeping people’s attention and turning it into action is becoming harder than ever, so it’s important to have a competitive conversion strategy. 

Personal connection is more important than ever. Even through social media, the values of friends and family recommendations prevail. When a recommendation is made by a friend or family member, there is a certain level of trust formed that isn’t always generated by the brand itself. This trust creates a higher conversion rate and brand awareness. When formulating a marketing strategy brands can mirror this trust by recruiting influencers who have brands that the desired audience trust. 

According to Datareportal, word of mouth recommendations are ranked just above social media ads, as the 3rd highest source brand discovery (following only search engines and tv ads). Despite the ability to connect with billions of people via the internet, close connections still seem to create stronger influence. Brands can utilize this connection via their own friends and family or recreate that same connection by building a social media community with potential consumers. 

Facebook Marketplace Remains Incredibly Popular for Millennials 

Despite Instagram’s fight to become the social platform for ecommerce, Facebook Marketplace remains significantly more popular overall with an estimated audience of 562.1 million compared to Instagram’s 187.6 million (DataReportal). Instagram certainly has its perks, especially for building a personal business brand. Yet Facebook Marketplace remains heavily utilized. Millennials, in particular, can’t seem to get enough use out of it. 

Many sellers on Marketplace are college students or older adults looking to get rid of items they no longer need. In addition to those casual users there are also small makers and crafters who are just starting out or have not yet consolidated their work into a full-time business. This is quite unlike Instagram and other social marketplaces, which are oriented around ongoing businesses. 

In the short-term, Facebook Marketplace can be a great place to get started selling your work, but in the long-term it doesn’t necessarily create a sustainable system with recurring customer and brand loyalty. 

Overall, Facebook Marketplace may seem like it’s dying due to the rise of other ecommerce, but it certainly is not. With nearly 600 million users, Facebook Marketplace remains incredibly popular. Though it may not be the best primary platform for your business, it could be a great asset somewhere along your entrepreneurial journey, especially if you are looking to target a millennial or gen-z audience.  

High Traffic Social Media Apps

In 2022, 92.5% of phone time was spent on applications and 7.5% on internet browsers (DataReportal). Mobile applications significantly outnumber search engine screen time. Data suggests that people are using apps like TikTok and Youtube to answer their questions rather than traditional browsers like Google. One theory is that influencers present more reliable opinions than traditional websites where the writer’s identity remains anonymous, drawing audiences to them for information and product recommendations.

Amongst applications, people are spending the most time on YouTube, Facebook, and TikTok. YouTube had the greatest amount of activity with users spending an average of 23.7 hours per month on the app, per user. Facebook and TikTok follow just behind with an average usage of 19.6 hours per month.

Based on the applications people are allocating their screen time to and the shift away from traditional browsers, people seem to be seeking out information presented in a more personable format. Building a clear, reliable identity on social media apps can therefore help establish your brand and reach large amounts of people. 

This is the final article in the Winter 2023 magazine.

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