How to Monetize Instagram With Uniquely Genuine Retargeted Ads & Generate a 10X ROI
Jan 18th, 2017
That ad looks hideous...
That's exactly what Edwin Hermawan recalls thinking when he noticed a particular retargeted ad on Facebook.
What was wrong with the ad?
Instead of naturally appearing as if it belonged streaming through a Facebook newsfeed, the product image included in the ad looked as if it had been ripped from a product page and carelessly thrown onto Facebook without any regard for aesthetics.
"It stuck out like a sore thumb," Hermawan says. "Instead of looking like it belonged on Facebook the ad looked like it had been pulled right off the brand's website with the ugly white background and all."
Turns out being lazy can be costly...
Rather than investing in ad images that appear more native or similar aesthetically to those users are accustomed to seeing on Facebook and Instagram, simply pulling the standard product images you already have on your site and using them to retarget users can result in:
- Higher customer acquisition costs
- Lower conversion rates and sales growth
"It's actually one reason Facebook is hesitant to open Instagram to more advertisers," Hermawan says. "Ugly ads can negatively impact the user experience on Instagram where users are accustomed to seeing beautiful photography and visuals."
Hermawan wanted to materially improve the quality and performance of the ads being served inside these applications...
But doing so, at least at the time, required him to manually insert new images that were more attractive than the status quo.
With clients all over the world...
It meant Hermawan would never be able to sleep. "I'd have to be up at three in the morning helping clients in Australia," he chuckles. "It wouldn't last long either as I'm certain my wife would kill me."
But what if there was another way...
What if Hermawan could keep his wife happy, automate the process, and completely change the way brands retarget?
Touches That Belong
Your ego can take a pounding in ecommerce...
The majority of people who visit your site for the first time, research suggests 98-percent, will leave without making a purchase. Retargeting is a way to find these users, bring them back to your site, and convert them into sales:
Image via: Growth Grind
As we illustrated in this post... Intelligent Post-Holiday Retargeting: The Dos & Don'ts
Retargeting can generate massive ROI by lifting sales and reducing customer acquisition costs as it did for these companies:
- Online tire seller Tirendo credits remarketing with a 161% increase in conversions
- Loews Hotels credits remarketing with a 10% increase in revenue
- Custom printer Storkie Express credits remarketing with a 203% increase in conversions
"Normal retargeting often uses the product detail image with a standard white background," Hermawan says. "But if I'm in Instagram seeing awesome images and am then hit with an ad like that it's not going to be as effective."
Hermawan suggests millennials don't want to be overtly sold to but still need to be touched multiple times across channels. Instead, he says they prefer to be engaged by brands and nudged toward a sale. It's why Hermawan founded Snappic, a software provider that helps ecommerce businesses uniquely retarget visitors on Facebook and Instagram:
Here's what differentiates Snappic:
Snappic automatically pulls a brand's social media images into dynamically created ads that are aesthetically consistent with the content being viewed inside applications like Facebook and Instagram. The images a brand has in its Instagram feed, according to Snappic, result in ads that are more genuine, have more engagement, and perform better.
"The ad images are more natural and consistent with what a user expects to see on Instagram," Hermawan says. "Our ads don't dilute Instagram feeds because they're created with the same high quality photography users are already enjoying in their feeds."
In other words, Snappic's ads better blend with the content user's love.
For example, a user who sees a Snappic retargeted ad in their Instagram feed, let's say it's a woman wearing a flowery top that's for sale, can click a Shop Now button and land on the product page offering that top for sale:
Snappic routinely runs this split test:
- Ads containing standard product detail images vs. Ads containing a brand's social images
According to Snappic, the ads containing social images reduced a brand's cost per customer acquisition by 25%
"Our ads perform much better," Hermawan says. "When brands use social images they can scale and acquire customers much cheaper."
It means Instagram can be a viable sales channel for merchants…
Unfortunately, Snappic suggests many large merchants are not monetizing Instagram and leaving big money on the table.
Give Me $1 & I'll Give You $10
The brands with which Snappic works often pour thousands of dollars a month into social dynamic ads...
But Hermawan says many merchants are not monetizing Instagram as they should. "Lots of merchants just don't see it," he says. "These are sophisticated people making a lot of money but the reality is they could be making a lot more."
Just like thousands of Snappic clients are.
Here's an example...
The inspirational eyewear company zeroUV wasn't satisfied with traditional retargeting ads that looked out of place on Instagram like this one:
So it turned to Snappic for help and soon began running retargeting campaigns that appear much more natural to Instagram users:
Notice the difference?
Here's another example...
Apolis is a lifestyle brand that sources and manufactures its apparel in places like Uganda, Peru, and Bangladesh to inspire social change. Instead of serving a traditional product detail image retargeting ad that would look like this:
The company uses Snappic's software to pull images from its Instagram feed and serve retargeted ads that look like this:
The Apolis campaign, according to the company, generated a 271% higher ROI versus the retargeting service it used in the past.
How do other campaigns like these perform?
"Just recently we had a brand spend six thousand dollars with us in a month," Hermawan says. "It's not uncommon for us to hand that merchant a check for thirty thousand dollars at the end of the month."
In addition to the 25-percent reduction in customer acquisition costs, Snappic campaigns are high performers:
- Median ROI is 10X
While you won't see it plastered all over the Snappic website- Hermawan is rather modest when it comes to discussing performance- Snappic has even run campaigns that have generated a 30-40X return.
"It's what we do everyday and it makes me feel really good to wake up in the morning," Hermawan says with a laugh. "I can't imagine not producing those results for clients."
The Most Natural & Contextual
The problem with online purchases being returned because of size issues can kill margins...
Snappic believes its social dynamic ads can help address this problem and position brands to reduce their size-related return rates. For example, Snappic argues consumers are often unsure of how an item might fit when looking only at a traditional product detail image.
"But imagine how a consumer's perception might change when they're looking at a jacket and see it on a guy who is built like them and roughly the same size," Hermawan says. "It can cause a consumer to say, 'Hey the jacket fits this guy awesome so it's going to fit me as well since we're the same size.'"
It means ads on Instagram, according to Hermawan, will become more natural, contextual, and effective. With Snappic leading the way, Facebook may soon be less reluctant to robustly open Instagram to advertisers out of concern that low quality image ads might harm the user experience and negatively impact engagement.
"We're super optimistic," Hermawan says excitedly. "If we can help solve the problem Facebook has with Instagram ads the sky's the limit because users will not feel as if they're being sold too but rather enjoying the same type of content they love."