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Instagram launches global ad service, and Facebook lays another golden egg 3 years after US$1 billion acquisition of photo-sharing app

PUBLISHED : Wednesday, 09 September, 2015, 12:00pm
UPDATED : Wednesday, 09 September, 2015, 1:28pm

From Shanghai to New York, many business accounts are already using Instagram to promote their products and services, though more for marketing and branding purposes, as well as to attract “fans”.

But three years after Facebook acquired the popular photo-sharing app for US$1 billion, it has finally shown its huge potential to add to the various profit streams of the world’s largest social media network.

Starting from this month, Instagram will allow any advertiser to run ads on its platform in Hong Kong, it said in a statement Wednesday. This is part of a broader plan to attract advertisers around the world as partners.

“People want to connect with all sorts of businesses on Instagram, from the clothing retailer around the corner to the largest brands around the world,” said Jayne Leung, head of Greater China for Facebook.

“Thousands of businesses in Hong Kong and around the world are already using Instagram as their shop window and what we are doing now is allowing those same businesses to monetise that,” she told the South China Morning Post.

She was referring to new functions that allow users of the social media app, which has over 300 million active users, to directly interact with advertisers.

Instagram began testing the service with selected partners in late 2013 and spent over a year collecting feedback from users and clients to fine-tune it, she said.

The international news channel of China’s state broadcaster CCTV was among the first batch of partners, and the ad service helped it gain more “brand awareness” in the United States, said Leung.

Now Hong Kong lists among over 30 countries that are engaging with its advertising business, a number that is expected to grow gradually in the coming weeks and months. 

In the bustling Asian metropolis, four launch partners include the Hong Kong Tourism Board (@discoverhongkong), Opensnap (@opensnaphk), P&G Vidal Sassoon (@vs_sassoon_hk) and Sony Mobile HK (@sonyxperiahk). 

Users of the service can, for example, click on a button embedded in an Instagram picture or video to be redirected to directly shop online. 

Facebook has been aggressively moving into new businesses in recent years, from e-commerce to its online payment service. 

When questioned about the former, Leung said businesses in Hong Kong are “shifting back to a more personal way of marketing”.

“This represents one of the biggest shifts in marketing in generations,” added Leung, a former regional executive for Google who helped open Facebook’s Hong Kong office about five years ago.

Last month, Instagram surprised the world by allowing its users to post photos and videos in landscape and portrait modes, moving beyond its iconic square-shaped photos. 

This was widely interpreted as a preliminary move to grant advertisers greater flexibility to create ads, while also allowing travel photography fans and other users to share “wider-screen” pictures.

Leung said there is no plan at present to roll out the new service in mainland China, the world’s largest internet market. 

Instagram was blocked by the Chinese authorities last September in the wake of Hong Kong’s pro-democracy Occupy Central movement as many protesters, especially young students, used it to share live photos of the demonstrations.

This left Beijing red-faced as Hong Kong faced its worst political crisis since the 1997 handover from British colonial rule.

Facebook has also been banned on the Chinese mainland since 2009, putting it on the same list as thousands of foreign web services including Google and The New York Times