Content Marketing Blog

Instagram bosses social media in 2014

Instagram, the popular photo sharing app for smartphones, has put other social media sites in the shade this year.

As 2014 draws to a close, it has outgrown Twitter and it has helped push the share price of its parent company, Facebook, to a record high.

Instagram was launched only four years ago by friends Kevin Systrom and Mike Krieger. It was sold to Facebook in 2012 for $1 billion.

According to one analyst, Instagram is now worth USD $35 billion on the back of higher ad revenues and strong user growth.

The company said this month that it now had more than 300 million users, with an average of 70 million photos shared and 2.5 billion likes posted every day. Twitter, meanwhile, has 284 million active users, according to its website.

[pullQuote position=”left”]Instagram members December 2010: 1 million
Instagram members December 2014: 300 million[/pullQuote]

Mark May of investment bank, Citigroup, told Bloomberg that while Instagram was only beginning to explore options for leveraging the user data it collects, it was “quickly gaining monetisation traction”, which is analyst-speak for it’s starting to make more money and will contribute a bigger share of Facebook’s revenues in the future.

The bumper $35 billion valuation would represent quite a return for Facebook CEO Mark Zuckerberg. At the time, Instagram was Facebook’s biggest ever deal, but it has now of course been eclipsed by this year’s $19 billion WhatsApp purchase.

And while the direct contribution Instagram makes to Facebook’s coffers may be limited right now, it is clear that Zuckerberg’s efforts to strengthen his mobile credentials with high profile acquisitions is paying off.

His company’s share price, which has at times been a stick for his critics to beat him over the head with, hit a record high, trading up 2.27 per cent at USD $81.68 a short time ago. Facebook reported revenue of USD $3.2 billion for the 3 months to September 30th this year, up by more than 30% on the same period in 2013, and said members were up 19 per cent to 864 million.

[pullQuote position=”right”]Facebook share price on December 21st 2012: $26.26
Facebook share price on December 22nd 2014: $81.69[/pullQuote]

Instagram meanwhile has been flourishing as part of the Facebook stable having trebled its number of users since the deal was signed. During that time it has invested heavily in the service, developing new filters and creative tools to keep its users interested.

Earlier this month, it unveiled badges for celebrities, athletes and brands to verify their real accounts, which will be an important part of the effort to attract and retain the recognisable names that will bring yet more users and more advertising revenue.

It also said it would step up efforts to identify and delete fake accounts, something that is a constant challenge for all big social media brands.

8 Content Marketing Fails
Click for free download