Facebook is finally about to make some big money from Instagram and its 300 million-plus monthly active users.
After nearly two years of carefully testing and slowly rolling out various ad tools, Instagram is finally launching its advertising service broadly.
Now all marketers, large and small will be able to easily buy ads on Instagram's self-service platform. And the app is expanding ads from just eight countries, to 30 additional countries, and will be available worldwide by the end of the month.
The company won't say how much launching ads across Instagram—across the world—could mean for Facebook's bottom line, but there's no question that demand is huge.
"We're moving from the hundreds of large brands we work with today to the several thousands of medium and small businesses with a presence on Instagram," said James Quarles, Instagram's global head of business and brand development.
"There are 2 million advertisers on Facebook today—that's the size and scale we're looking at. Plus expanding from eight markets to 30, that gives you a sense of the broadening of availability."
Along with rolling ads out broadly, Instagram is offering a couple of key new tools for marketers. The company's offering video ads of up to 30 seconds long, appealing to the most valuable ad format right now—mobile video. Both photo and video ads will be in a landscape format. Marketers can buy and measure ads across both Instagram and Facebook together—so it's easy to run targeted campaigns on both platforms, at the same time.
Instagram is also launching a new premium tool to quickly drive mass awareness, called "Marquee." Designed to help advertisers quickly get the word out for a big event such as a movie or product launch, Instagram says it's a new way to push mass recognition.
"Lots and lots of advertisers have these moments they want to communicate broadly," said Quarles. "If you have a movie launching, a new handset launching, those are all big moments. Marquee offers the ability for a campaign to have greater prominence."
Plus, Instagam is widely launching a "shop now" button—useful for retailers, plus other buttons to encourage consumers to click to learn more or download an app. "There are just so many small businesses, from coffee shops to retailers, that have organic accounts; we've found we can create value for the businesses, value for the community."
And Instagram has been so cautious about how it's rolled out and tested its ads, Quarles says he's confident that the ads will feel natural in its system, and will be effective for advertisers.
Taking nearly two years to get to this point, Quarles says will pay off: "A high-quality ad experience is incredibly important. We have sent a consistent tone of what a 'native' ad looks like and how it performs. We'll look at a lot of signals. paying closest attention to feedback from the community itself, about hide this ad or hide this advertiser," said Quarles. "We know people want more relevant advertising than just aesthetically beautiful."
Facebook says that ad recall from sponsored posts on Instagram was 2.8 times higher than Nielsen's norms for online advertising, according to a study of 400 campaigns first reported in June.
And as part of this announcement the company says 97 percent of measured campaigns on Instagram have generated a statistically significant lift in ad recall. The company's also sharing some specific success stories: Gilt Group's campaign drove an 85 percent increase in app installs and Made.com's ads yielded a 10 percent increase in order volume of its furniture.
Clarification: This story has been updated to properly reflect the format in which ads will be presented.