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Instagram signs big deal with its first advertising agency, Omnicom

It only seem like a few weeks back that we were report­ing on Instagram’s deci­sion to pro­ceed with its care­ful­ly tout­ed soft­ly, soft­ly approach to mobile adver­tis­ing; and this month it’s tak­en the process a big step for­ward by sign­ing its first deal with an ad agency: New York-head­quar­tered giant, Omnicom.

You don’t need to be a vet­er­an of media jobs in mobile adver­tis­ing agen­cies to appre­ci­ate that a $100 mil­lion deal is pret­ty size­able. The many brands work­ing with the media and cre­ative agen­cies con­sti­tut­ing the Omni­com group can now access Insta­gram as an extra medi­um for their adver­tis­ing cam­paigns, at least for the next year, which is how long the deal cur­rent­ly lasts for.

Test­ing the waters

Much of the last year was spent by Insta­gram try­ing out adver­tis­ing from brands like Levi’s, Lexus, Ben & Jerry’s, Gen­er­al Elec­tric and Michael Kors. Again, you don’t need to be a genius in the world of mobile adver­tis­ing to fig­ure out why it took the step: eMarketer’s fig­ures show in 2013 that the glob­al mobile adver­tis­ing mar­ket expand­ed by 105.9 per­cent, sky­rock­et­ing from a size of $8.8 bil­lion in 2012 to $18.8 mil­lion. The growth of the U.S. mobile ad mar­ket was even more spec­tac­u­lar at 122 per­cent (tak­ing it to $9.68 million).

The Omni­com deal will see ads, from sta­t­ic pho­tos to videos, added into Insta­gram users’ feeds. In line with Instagram’s promise not to intro­duce obtru­sive adver­tis­ing, they’ll be metic­u­lous­ly select­ed and man­u­al­ly (rather than auto­mat­i­cal­ly) bought and curat­ed. It’s like­ly that the video ads will prove the most lucra­tive: the medi­um has long been known to com­mand the high­est lev­els of engage­ment and mon­e­ti­za­tion. That’s prob­a­bly why they’ve been pop­ping up with gus­to on just about all dig­i­tal enti­ties sup­port­ing video, from news sources to YouTube.

Unob­tru­sive progress?

Insta­gram is insist­ing that the ads it will per­mit will be ful­ly in keep­ing with the qual­i­ty of its user-gen­er­at­ed con­tent. The jury, how­ev­er, is still out on whether users will grow to love beau­ti­ful artis­tic ad cre­ations or vote with their feet and use anoth­er plat­form for shar­ing their content.

Ad part­ner­ships, Insta­gram main­tains, will be held down to a small num­ber of select part­ners. Rumor has it that anoth­er giant, Pub­li­cis Groupe’s Star­com Medi­aVest, is in talks to become one of them.

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