L – R Instagram photographs by Hermès & Gucci
What is Instagram?
Instagram is a free photo sharing application for mobile, which allows users to take photos, apply a filter, and share it on the service or a variety of other social networking services (CrunchBase).
Launched in March 2010 by Kevin Systrom and Mike Krieger, with seed funding of $500,000, the platform was purchased in April 2012 by Facebook for a reported $1 billion in cash and stock. The application is currently compatible with any iPhone, iPad or iPod Touch or any Android device running Android 2.2 or above.
“ In the ten days after launching its first Android App, Instagram’s user base grew from 30 to 40 million ”
Who is using Instagram?
Originally available only to iPhone owners, the Instagram iOS app had accumulated over 30 million users just eighteen months after it debuted. In the ten days after launching its first Android App, Instagram’s user base grew from 30 to 40 million, at a rate of over 1,000,000 new users per day.
Instagram has continued to grow at an astounding pace in the first seven months of 2012 – going from 15 million users in early 2012 to 80 million in July – an increase of over 400% in just seven months (Forbes).
According to data from appdata.com, the user base of Instagram is nearly 70% female – described by Forbes as the people who make the majority of household purchase decisions.
Number of Instagram Followers *Current Thursday 23rd August 2012
How are luxury brands using Instagram?
40 percent of the world’s most popular 100 brands – according to Interbrand – are now active on the photo-sharing network. When it comes to luxury, the key players so far are Burberry, Gucci, Tiffany & Co., Audi, and Hermès, with follower bases between 75,000 and 500,000.
Instagram is fast establishing itself as the social network of choice for luxury lifestyle brands according to L2 because luxury brands have inherently visual stories to tell. Burberry, for example, use the platform to reinforce its ‘Britishness’, showcasing photos of the London skyline and key landmarks, alongside the occasional product shot or advertising campaign.
“ Instagram is fast establishing itself as the social network of choice for luxury lifestyle brands because they have inherently visual stories to tell ”
Hermès – active on Facebook but yet to launch an official Twitter account – follows a much more product oriented approach. Under the username Hermès Paris, the brand shares photographs of its accessories, homewares and iconic orange packaging, both as advertising images and amateur shots of products in action.
The platform is also being increasingly used for photographic competitions. Brands such as Chloé, W Hotels, Tiffany & Co. and Four Seasons have all taken to the App to encourage conversations with fans and ensure user engagement.
W Hotels went so far as to launch an Instagram exhibition at its New York City property, which showcased the work of six commissioned artists but also allowed its Instagram community to win two-nights stay when submitting photographs under the hashtag #wdesign.
Burberry use Instagram to share new products, advertising campaigns and cover events, as well as champion its ‘Britishness’ with photographs of London
Why should it be a consideration for luxury brand marketers?
“Our atomic unit of communication on Instagram is an image,” explained founder Kevin Systrom to TechCrunch. “Advertisers all around the world speak in images.” Perhaps even more compelling, is the fact that if someone opens Instagram, they’re likely to open it eight more times that day.
Systrom is confident that Instagram may be “the next big opportunity in display advertising.” And even though the app doesn’t have an ad program yet, he highlighted three ways that brands are already using it; To promote products, for live event coverage and publicity, and to create Instagram specific campaigns – such as the example with W Hotels.
“What’s really cool about this is, it doesn’t feel like advertising,” Systrom mused. “When you open Instagram, it feels like entertainment.”
“ Our atomic unit of communication on Instagram is an image. Advertisers all around the world speak in images ”
One particular US fashion brand has come forward to champion the platform’s direct impact on sales. In conversation with Luxury Daily, Rebecca Minkoff founder Uri Minkoff, explained how the brand’s Instagram community now forms an integral part of both the design process and retail mix.
Rebecca Minkoff- the designer – first started using Instagram to share “shoe of the day” images that showed her outfit from her legs down (Luxury Daily). The brand has since grown its community to 70,000+ users, where the amount of “likes” and comments that the images receive can go into the thousands.
The brand now uses the platform for instantaneous feedback on design and to interact with the comments that it sees on images, and steer consumers towards retail partners or brand hubs. As a result, spring shoe sales were up 100 percent, with expectations to grow by 200 percent this year. The brand also used user generated Instagram photographs as advertising, in the debut issue of Style.com/Print issue.
W Hotels launched Manhattan’s first ever social network photo exhibition in May 2012
Why should luxury brand marketers be cautious?
“A poor shot of a watch on a hairy wrist,” deadpans (Franck Jehanne), co-founder of The Kalory Agency. “An un-retouched close-up of a handbag buckle showing micro scratches rather than representing its true luxury material feel. A picture of a flagship store featuring a dirty street and people’s reflections instead of carefully merchandised window displays,” he continues. “All these communications feature the wrong message and effectively kill the luxury dream.”
To avoid this, many luxury brands are using professionally shot product and campaign images on the app, before applying various filters and affects. But the one area they have little control over is user generated comments, which range from complimentary and celebratory, to – more often than not – profane and absurd.
Everything from requests for internships, to abbreviated Internet speak (LOL, G8, <3), to self promotion from followers, and what appears to be the work of Spambots. It has a similar effect to seeing a carefully styled, photographed and printed advertising campaign, covered in graffiti at a bus stop.
Rebecca Minkoff’s print campaign in Style.com/Print, using user-generated Instagram images of the brands accessories
Where can Instagram take luxury brand marketing?
As yet, this is not deterring luxury brands. On the contrary, more and more brands are launching communities everyday. But as compared to Facebook and Twitter, Instagram is still in its infancy, both in terms of community size and sophistication. Though its growth is undeniably impressive, little is really understood as to how brands will benefit from making it a part of their marketing mix.
Parallels can be drawn to Facebook, in that until recently, luxury brands didn’t really know what to do with the millions of followers their branded content and inside access was earning them. But as that social network has become more sophisticated and collaborative, we have seen many luxury brands move far beyond consumer engagement, into crowdsourcing projects, social commerce and producing Facebook exclusive products.
The Simply Measured Instagram study estimates that use of the platform by businesses will only increase as new administrative features become available. Features that allow brands to better control their accounts, manage communities and drive deeper engagement and business value.
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