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© L2 2014 L2ThinkTank.com
In Partnership with:
InstagramFebruary 10, 2014
For sole use of andrea.wang@ust.hk
The report ha...
2
February 10, 2014Intelligence Report:
Instagram
THE WORLD’S MOST POWERFUL SOCIAL PLATFORM?
Size vs Engagement
Prestige B...
3
February 10, 2014Intelligence Report:
Instagram
Best/Worst
Although both had billion dollar price tags, Instagram is arg...
4
February 10, 2014Intelligence Report:
Instagram
Instagram: User Growth
December 2010–December 2013
1 million
5 million
1...
5
February 10, 2014Intelligence Report:
Instagram
Table of Contents
Click logo to return here. Click screen shots with thi...
6
February 10, 2014Intelligence Report:
Instagram
BEAUTY
Almay
Aveda
Aveeno
Avon
Bare Escentuals
Benefit Cosmetics
Bobbi B...
7
February 10, 2014Intelligence Report:
Instagram
of prestige brands have an Instagram account
Monthly Active Users
150mil...
8
February 10, 2014Intelligence Report:
Instagram
Key Findings
Essie
Lush
Urban Decay
Jimmy Choo
Tiffany & Co.
y=-0.001ln(...
9
February 10, 2014Intelligence Report:
Instagram
Key Findings
3,500,710
@victoriassecret
1,994,583
@louboutinworld
1,165,...
10
February 10, 2014Intelligence Report:
Instagram
Key Findings
The Global Language of Pictures
Instagram is available in ...
11
February 10, 2014Intelligence Report:
Instagram
In the Company of Genius
Michael Kors
Instagram is front row at the cor...
February 10, 2014Intelligence Report:
Instagram
In the Company of Genius
@MichaelKors Follower and Engagement Growth
Octob...
13
February 10, 2014Intelligence Report:
Instagram
Key Findings
Hashing It Out
Brands leverage hashtags to crowdsource use...
14
February 10, 2014Intelligence Report:
Instagram
Key Findings
Instagram: Community Size vs. Brand Hashtagged Posts
Janua...
15
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Benefit Cosmetics
One of the most successful new Beauty...
16
February 10, 2014Intelligence Report:
Instagram
Key Findings
Insta-Video
Seventy-two percent of prestige brands post In...
17
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Swarovski #InstaSparkle and Giorgio
Armani #SiByArmani
...
18
February 10, 2014Intelligence Report:
Instagram
Key Findings
Visual Commerce The Next Frontier
With consumers more like...
19
February 10, 2014Intelligence Report:
Instagram
Key Findings
Visual Commerce = Conversion
By showcasing user-generated ...
20
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
West Elm
West Elm’s “Share Your Style” gallery has beco...
21
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Brand owned social network
FP Me fosters conversation a...
22
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Lancôme
Lancôme’s Project #bareselfie campaign for the ...
23
February 10, 2014Intelligence Report:
Instagram
Key Findings
Facebook Integration
Parent company Facebook serves as a p...
24
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
White House | Black Market
#WearWhatWorks
Proving selfi...
25
February 10, 2014Intelligence Report:
Instagram
Key Findings
Instagram Advertising
With the release of the November 1, ...
26
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Macy’s Floats Instagram Advertising
In addition to live...
27
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Starwood Hotels & Resorts
Guest Galleries
Instagram’s g...
28
February 10, 2014Intelligence Report:
Instagram
Key Findings
Instagram Direct
A direct shot at rival Snapchat, Instagra...
29
February 10, 2014Intelligence Report:
Instagram
Flash of Genius
Estée Lauder
For three days in December, Estée Lauder t...
30
February 10, 2014Intelligence Report:
Instagram
The Team
Scott Galloway
Professor of Marketing, NYU Stern
Founder, L2
S...
31
February 10, 2014Intelligence Report:
Instagram
About L2 ?
L2 is a think tank for digital innovation.
We are a membersh...
A THINK TANK
for DIGITAL INNOVATION
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L2-Intelligence-Report-Instagram-2014

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L2-Intelligence-Report-Instagram-2014

  1. 1. © L2 2014 L2ThinkTank.com In Partnership with: InstagramFebruary 10, 2014 For sole use of andrea.wang@ust.hk The report has been licensed to andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  2. 2. 2 February 10, 2014Intelligence Report: Instagram THE WORLD’S MOST POWERFUL SOCIAL PLATFORM? Size vs Engagement Prestige Brands January 2014, n=249 Engaged Users Users x Platform Engagement Rate (MM) December 2013 Explosive growth, aspirational demographics, and unmatched engagement have secured Instagram’s place among the social media elite. Instagram amassed 150 million monthly users in three years—two years faster than Facebook and half the time of Twitter. Although an eighth of parent company Facebook’s community, Instagram registers 15 times the engagement and double the engaged user base (Total Community Size x Engagement Rate) of the mother ship. 93 percent of prestige brands now maintain a presence on the photo-sharing platform, up from 63 percent in July 2013.1 As teens migrate away from Facebook, Instagram has maintained its street cred and is the fastest growing global social platform. The visual platform acquired 60 million new monthly active users in 2013,2 the highest year-over-year growth (66 percent) among top 10 mobile apps.3 The Other Girl Instagram is often compared to the other visual darling Pinterest, launched six months before Instagram (October 2010). Today, Pinterest is a third of Instagram’s size and 23 percent of Pinterest users engage with the platform daily, versus 58 percent on Instagram.4 Other upstart visual and mobile platforms, including Vine, have entered the fray. However, within a week of launching video, Instagram passed Vine in shares on Twitter5 and boasts 2.5 times the shares.6 The reach and appeal of the 15-second video format, ideal for ads, gives Instagram an edge (Vine limits videos to six seconds) with advertisers. The biggest threat may be newcomer Snapchat. However, while seven times more photos are uploaded daily to Snapchat, Instagram’s superior demographics—slightly older, higher income users—has greater appeal to marketers. Recently Instagram took direct aim at Snapchat with the December 2013 launch of direct messaging, enabling brands to engage in two-way conversations with consumers. 1. L2 Intelligence: Social Platforms, August 2013. 2. Instagram, September 2013. 3. “Tops of 2013: Digital,” Nielsen, January 2014. 4. “Social Media Update 2013,” Maeve Duggan and Aaron Smith, Pew Internet, December 30, 2013. 5. “A Week After Instagram’s Video Launch, Vine Sharing Tanks On Twitter,” Matt McGee, Marketing Land, June 27, 2013. 6. Topsy, January 2014. Community Size Interaction Rate Monthly Active Users = Size 1,256,088 0.10% 1,190 million 60,976 0.04% 218 million 500,0000 1,000,000 1,500,000 255,587 0.09% 300 million 0.0% 0.3% 0.6% 0.9% 1.2% 1.5% 122,031 1.53% 150 million EngagementRate Community Size Instagram Facebook Google+ Twitter 2.3 1.2 0.3 0.1 Watch the Video For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  3. 3. 3 February 10, 2014Intelligence Report: Instagram Best/Worst Although both had billion dollar price tags, Instagram is arguably the best media acquisition of the last five years and Tumblr the worst. Prestige brands have abandoned Tumblr, and the adoption rate has declined. Instagram’s 2014 revenues are forecast at $250 million–$400 million,7 while mention of Tumblr was noticeably absent from parent company Yahoo!’s recent earnings announcement. Picture > Thousand Clicks Visual media do more than communicate information, they inspire emotion and action. Serving a potent cocktail of visual and mobile, Instagram could be the first platform that delivers on the promise of social commerce via the power of user- generated content. Featuring user-generated photos at the point of purchase boosts conversion up to 7 percent.8 However, most prestige brands are failing to translate Instagram’s engagement to e-commerce, as just 14 percent utilize Instagram UGC on their brand sites. L2 Intelligence: Instagram In August 2013, L2 surveyed prestige brands across 15 global social media platforms. We turn our focus to Instagram, evaluating performance and programming of 249 prestige brands on the platform. Our aim is to provide data, best practices, and case studies to help managers achieve greater ROI on digital efforts. Like the medium we are assessing, our approach is dynamic. Please reach out with comments regarding our methodology and findings. 7. Analyst Estimate, Evercore, October 2013. 8. Olapic, January 2014. Global Social Platform Active Usage Percentage Change Q2–Q4 2013 Source: GlobalWebIndex Q4 2013, Global Internet Source: Neilson, January 2014 Top 10 Mobile Apps 2013 SCOTT GALLOWAY Professor of Marketing, NYU Stern; Founder, L2 scott@stern.nyu.edu PAU SABRIA Co-Founder, Olapic pau@olapic.com 23%Instagram 9%Linkedin 9%Tencent Weibo 6%Sina Weibo 6%Pinterest 6%Tumblr 6%Google+ 2%Twitter -3% YouTube -3% Facebook -3% VK -12% Myspace Rank App Average Unique Users YoY % Change 1 Facebook 103,420,000 27% 2 Google Search 75,984,000 37% 3 Google Play 73,677,000 28% 4 YouTube 71,962,000 27% 5 Google Maps 68,580,000 14% 6 Gmail 64,408,000 29% 7 Instagram 31,992,000 66% 8 Maps (Apple) 31,891,000 64% 9 Stocks 30,781,000 32% 10 Twitter 30,760,000 36% For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  4. 4. 4 February 10, 2014Intelligence Report: Instagram Instagram: User Growth December 2010–December 2013 1 million 5 million 10 million 80 million 100 million 90 million 100 million 150 million 130 million 15 million 40 million 50 million Facebook Acquires Instagram Online Profiles Video Sharing Android App Numberofusers(millions) 0 20 40 60 80 100 120 140 160 Dec 2010 Jun 2011 2014 Sep Dec Apr May Jul 2012 Sep Jan Feb SepJun 2013 Nov Dec Direct Messaging Advertising Instagram switches to releasing Monthly Active Users rather than local number of users For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  5. 5. 5 February 10, 2014Intelligence Report: Instagram Table of Contents Click logo to return here. Click screen shots with this icon to view online. Click to jump to: Brand List Instagram by the Numbers Now…Instagram KEY FINDING The Global Language of Pictures KEY FINDING Michael Kors IN THE COMPANY OF GENIUS Hashing It Out KEY FINDING Benefit Cosmetics FLASH OF GENIUS Insta-Video KEY FINDING Swarovski #InstaSparkle and Giorgio Armani #SiByArmani FLASH OF GENIUS Visual Commerce The Next Frontier KEY FINDING Visual Commerce = Conversion KEY FINDING West Elm FLASH OF GENIUS Urban Outfitters and Free People FLASH OF GENIUS Lancôme FLASH OF GENIUS Facebook Integration KEY FINDING White House | Black Market #WearWhatWorks FLASH OF GENIUS Instagram Advertising KEY FINDING Macy’s Floats Instagram Advertising FLASH OF GENIUS Starwood Hotels & Resorts Guest Galleries FLASH OF GENIUS Instagram Direct KEY FINDING Estée Lauder FLASH OF GENIUS The Team About L2 6 7 8 10 11 13 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  6. 6. 6 February 10, 2014Intelligence Report: Instagram BEAUTY Almay Aveda Aveeno Avon Bare Escentuals Benefit Cosmetics Bobbi Brown Burt’s Bees Carol’s Daughter Cetaphil Clarins Clinique CoverGirl Dove Elizabeth Arden EM Cosmetics Essie Estée Lauder Fresh Garnier Giorgio Armani Beauty Iman Cosmetics Kiehl’s L’OCCITANE en Provence L’Oréal Paris La Mer La Prairie La Roche-Posay Lancôme Laura Mercier MAC Cosmetics Make Up For Ever Mary Kay Maybelline New York NARS Cosmetics Neutrogena Nivea Olay OPI Origins Perricone MD Philosophy Proactiv Revlon Rimmel London Sally Hansen Shiseido SK-II Skinceuticals Smashbox Cosmetics Trish McEvoy Urban Decay Vichy Yves Saint Laurent Beauty Alexander McQueen Alfred Dunhill Armani Balenciaga Bally Bottega Veneta Burberry Calvin Klein Chanel Chloé Christian Louboutin Coach Cole Haan Diane Von Furstenberg Dior Dolce & Gabbana Donna Karan Ermenegildo Zegna Fendi Gucci Hermès Hugo Boss Jimmy Choo Kate Spade Louis Vuitton Marc Jacobs Max Mara Michael Kors Oscar de la Renta Prada Ralph Lauren Saint Laurent Salvatore Ferragamo Tod’s Tommy Hilfiger Tory Burch Valentino 7 For All Mankind A|X Armani Exchange Abercrombie & Fitch Aéropostale Aldo American Apparel American Eagle Outfitters Ann Taylor Anthropologie ASOS Banana Republic Barneys New York Bath & Body Works BCBG Bergdorf Goodman Bloomingdale’s Blue Nile Bluefly Bon-Ton Boots Brooks Brothers Brown Thomas CB2 Century 21 Chico’s Club Monaco Crate & Barrel Daslu de Bijenkorf Destination Maternity Diesel Dillard’s El Corté Ingles El Palacio de Hierro Esprit Ethan Allen Express Fenwick Free People French Connection Galeries Lafayette Galleria Department Store Gap Godiva Chocolatier Guess GUM Gymboree H&M Harrods Harvey Nichols Holt Renfrew House of Fraser Hudson’s Bay IKEA Intermix J Brand J.Crew Jelmoli Joe Fresh John Lewis Juicy Couture KaDeWe Kay Jewelers La Maison Ogilvy La Rinascente Lacoste Lane Crawford Le Bon Marche Liberty Lord & Taylor Lucky Brand Lululemon Athletica Lush Macy’s Marks & Spencer Massimo Dutti Neiman Marcus Net-A-Porter Nine West Nordstrom Pier 1 Imports Pottery Barn Printemps Restoration Hardware Saks Fifth Avenue Selfridges Sephora Shopbop Steve Madden Stuart Weitzman Swatch Talbots The Body Shop Topshop TSUM Tumi Ulta Uniqlo United Colors of Benetton Urban Outfitters Victoria’s Secret Vince Camuto Von Maur West Elm White House | Black Market Williams-Sonoma YOOX Zales Zappos.com Zara Conrad Fairmont Hotels Four Seasons InterContinental Jumeirah JW Marriott Le Meridien Mandarin Oriental Morgans Park Hyatt Relais & Chateaux Rosewood Shangri-La Sofitel St. Regis The Peninsula The Ritz-Carlton Waldorf-Astoria Westin Audemars Piguet Baccarat Baume et Mercier Bulgari Cartier Chopard David Yurman De Beers Fossil Harry Winston Hublot IWC Schaffhausen Jaeger-LeCoultre Longines Montblanc Movado Officine Panerai Omega Pandora Patek Philippe Piaget Raymond Weil Rolex Swarovski TAG Heuer Tiffany & Co. Vacheron Constantin Van Cleef & Arpels FASHION RETAIL HOTELS WATCHES & JEWELRY Brand List in Alphabetical Order by Sector For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  7. 7. 7 February 10, 2014Intelligence Report: Instagram of prestige brands have an Instagram account Monthly Active Users 150million It took Instagram 1/2 the time of Twitter and 2 years less than Facebook to reach 150million monthly active users Instagram engagement is 15x Facebook’s Average Time Spent Per User Per Month: 257minutes Number of Comments Per Second: 1,000 Number of Likes Per Second: 8,500 Number of Likes Per Day: 1.2 Billion Average Photos Uploaded Per Day: 55 Million Total Photos Shared on Instagram to date: 16 Billion 57% of users use Instagram on a daily basis 35% of users visit Instagram more than once per day 99% of post engagement is from Likes 60% of users outside of U.S 66% YOY increase in Average Unique Users of the Instagram app in 2013 1/2 of Instagram users are on Android; 1/2 are on iOS 90% of Instagram users are under 35 68% of Instagram’s users are women Instagram’s 2014 revenues are forecast at $250-$400 Million 92% In 2013 Instagram gained 60 millon+ new monthly active users 2014 54% of all internet users post original photos and videos online 9 out of 10 Instagram video shares occur on Facebook Seventy-two percent of prestige brands post Instagram videos Engagement on prestige brand photo posts is 1.5x video posts 14% of prestige brands integrate Instagram UGC on their brand site 63% of prestige brands link to their instagram account from their brand site 54% of prestige brands link from Facebook to their Instagram account Instagram’s Engaged User Base (Total Community Size x Engagement Rate) is 2x Facebook’s 16% of online adults with household income greater than $75k use Instagram On average prestige brands post 6 images per week and 0.38 videos per week 2.5x more Instagram links than Vine’s are shared on Twitter Instagram By The Numbers ADOPTION ENGAGEMENT CONTENT Source: L2 Think Tank, Instagram, Global Web Index, Business Insider, Wall Street Journal, Pew Internet Research, UnRuly, Topsy, Twitter, Facebook, Evercore For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  8. 8. 8 February 10, 2014Intelligence Report: Instagram Key Findings Essie Lush Urban Decay Jimmy Choo Tiffany & Co. y=-0.001ln(x) + 0.0249 R2 =0.08404 Victoria SecretNordstrom Michael Kors Maybelline 9.0% 1.0% 0.2% 0% 10,000 100,000 1,000,000 10,000,000 Urban Outfitters Now…Instagram Ninety-three percent of prestige brands are present on Instagram, up from 63 percent in July 2013. Brands post an average of 5.5 times a week, and 43 percent of accounts post more than once a day. Ninety-nine percent of user engagement is likes. Retail and Fashion brands dominate the top 10 largest communities. For these categories, Instagram is an evolved form of window-shopping enabling users to see products on organic mannequins. Beauty brand accounts are the fastest growing and yield the greatest engagement. Cult Beauty brands Urban Decay, Essie, and Lush outperform the establishment. Instagram: Average Size, Growth, and Engagement by Category August 1–December 2013, n=232 EngagementRate Growth 2.5% 2.5% 1.5% 1.0% 0% 50% 100% 150% 200% 250% Beauty 3,626,363 n=53 Fashion 14,741,894 n=36 Specialty Retail 23,304,853 n=102 Watches & Jewelry 1,749,178 n=24Hospitality 204,729 n=17 Instagram: Community Size vs. Engagement December 31 2013, n=173 Community Size Logarithmic Scale EngagementRateLogarithmicScale Retail Watches & JewelryFashion Beauty For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  9. 9. 9 February 10, 2014Intelligence Report: Instagram Key Findings 3,500,710 @victoriassecret 1,994,583 @louboutinworld 1,165,441 @burberry 1,164,641 @louisvuitton 1,658,483 @topshop 1,566,603 @michaelkors 1,503,134 @hm 1,261,450 @asos 1,108,263 @urbanoutfitters 1,068,686 @vspink 1,050,373 @gucci 1,017,540 @marcjacobsintl 1,005,264 @tiffanyandco Instagram: Millionaire Club December 2013, n=644 Retail Watches & JewelryFashion For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  10. 10. 10 February 10, 2014Intelligence Report: Instagram Key Findings The Global Language of Pictures Instagram is available in 25 languages and 60 percent of users reside outside the United States. Thailand’s Siam Paragon mall was the most Instagrammed place in 2013.9 Unlike other Western platforms, Instagram (inexplicably) has been allowed behind China’s “Great Firewall,” and content is sharable to China’s Sina Weibo and Japan’s Mixi. A burgeoning Instagram economy has emerged in Kuwait, selling everything from sheep to lipstick. Outside of the U.S., Brazil, The United Kingdom, Russia, and Mexico round out the top five countries accessing Instagram.10 Across prestige brand accounts Instagram’s visuals require little translation. In the last five months of 2013, prestige brand Instagram communities in Asia-Pacific, the world’s largest consumer market, quadrupled. Eastern European prestige brand communities, led primarily by Russian accounts, record the highest engagement. 9. “Thanks to Thailand’s snap-happy Instagrammers, one Bangkok mall is Instagram’s most photographed place in 2013,” Steven Millward, Tech in Asia, December 13, 2013. 10. Alexa, January 2014. Within 3 months of the integration, 50,000 Chinese linked their Instagram and Sina Weibo accounts. From August to December, Kate Spade’s Thailand account grew 146 percent to 7,500 followers. Topshop’s Russia account has 19,000 followers. Instagram: Average Size, Growth, and Engagement by Region December 2013, n=249 APAC n=45 Eastern Europe n=45 Latin America n=32 Middle East & Africa n=13 North America n=46 Western Europe n=43 20% 40% 60% 80% 100% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% Average GrowthEngagementRate For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  11. 11. 11 February 10, 2014Intelligence Report: Instagram In the Company of Genius Michael Kors Instagram is front row at the coronation of fashion’s latest digital darling. With its August 2012 #MKTIMELESS contest Michael Kors became one of the first brands to launch a user-generated campaign on the platform, encouraging consumers to upload pictures of their Michael Kors’s watches. A year later, Michael Kors was first to launch Instagram advertising, acquiring 34,000 new followers in 18 hours. The brand integrates Instagram into both online and offline experiences. 5,000 photos with the #MKTOKYO hashtag were broadcast on a digital wall at the Tokyo National Museum. The brand was also among the first to use Instagram’s direct messaging, delivering a private message from Mr. Kors to the first 50 responders. In the last half of 2013, @michaelkors added 561,858 followers (56% growth). August 2012: The brand asked users to share their favorite Michael Kors watch using the #MKTIMELESS hashtag; 6,800 photos were submitted and its Instagram following grew by 50 percent in two weeks. June 2013: #WhatsInYourKors generated 1,900 pics of fan’s handbag contents. August 2013: As part of the #sportysexyglam campaign introducing the brand’s new fragrance and beauty collection, 1,000 pictures have been hashtagged #MKGLAM. November 2013: #jetsetselma: 1,000 Selma owners snapped their bag for (weekly) chance at a new bag. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  12. 12. February 10, 2014Intelligence Report: Instagram In the Company of Genius @MichaelKors Follower and Engagement Growth October–December 2013 October 16, 2013 The #watchhungerstop campaign in-store T-shirt giveaway and photo booth included a digital billboard online and in Times Square, generating 7,000 Instagram posts. 5,000 10,000 15,000 20,000 25,000 30,000 0 1.4% 1.5% 1.5% 1.16% 1.6% 1.7% 1.4% Oct 1 2013 Oct 8 2013 Oct 15 2013 Oct 22 2013 Oct 29 2013 Nov 5 2013 Nov 12 2013 Nov 19 2013 Nov 26 2013 Dec 3 2013 Dec 10 2013 Dec 17 2013 Dec 24 2013 Dec 31 2013 Jan 7 2014 Jan 14 2014 November 1, 2013 The brand’s Instagram ad attracted 34,000 new followers (+370 percent) in the first 18 hours and reached 16.5 million users. The sponsored post received 230,000+ likes and 175,000+ comments. November 14, 2013 #MKTOKYO generated 850+ UGC photos, streamed live at the Tokyo National Museum. December 5, 2013 Instagram video of Michael Kors and Gwyneth Paltrow singing “Santa Baby.” December 12, 2013 Michael Kors sent personal message to first 50 commenters using #MKDirect. Instagram Followers Engagement Rate 1 1 2 2 3 3 4 4 5 5 NewFollowersPerDay EngagementRate 12 For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  13. 13. 13 February 10, 2014Intelligence Report: Instagram Key Findings Hashing It Out Brands leverage hashtags to crowdsource user-generated content and to increase visibility of content. Instagrammers use hashtags for content discovery, to show off their selfies and hauls, and to express brand affinity. Eighty percent of brand posts contain at least one hashtag, and the average brand post will have three. Brands are more likely to leverage generic hashtags than their own branded hashtags. However, Urban Outfitters, Daslu, and Free People consistently use their brand hashtags, encouraging users to adopt them in their posts. The most hashtagged prestige brand on Instagram, Chanel does not have an official presence on the platform. Dior, also in the top 10, was late to the Instagram party, launching its account in October. Topshop, Gucci, Michael Kors, and Louis Vuitton are among the top 10 hashtagged brands and boast top 10 communities. Instagram: Top 10 Brand Number of Hashtagged Posts December 2013, n=88 Also in Top 10 Instagram FollowersAccount No Account # #chanel #zara #topshop #gucci #opi #prada #michaelkors #louisvuitton #dior 4,957,198 3,547,580 3,058,871 2,042,331 1,893,154 1,858,161 1,729,891 1,713,129 1,533,271 For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  14. 14. 14 February 10, 2014Intelligence Report: Instagram Key Findings Instagram: Community Size vs. Brand Hashtagged Posts January 2014, n=253 21 210 2,100 21,000 24 240 2,400 40,000 2,400,000 24,000 2,100,000210,000 Brand Hashtagged Posts InstagramFollowers Benefit Cosmetics American Eagle NET-A-PORTER Tiffany & Co. Victoria’s Secret Topshop Louis Vuitton Gucci Michael Kors Dolce & Gabbana Burberry Saint Laurent Dior Hermès IKEA ZaraPrada Sephora OPI y=7.2212x0.7803 R2 =0.47326 Retail Watches & JewelryFashion Beauty For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  15. 15. 15 February 10, 2014Intelligence Report: Instagram Flash of Genius Benefit Cosmetics One of the most successful new Beauty products of 2013, Benefit Cosmetics “they’re real!” mascara was launched on the back of social media. Benefit turned to Instagram to find images of real people using the product. 11,900 selfies were submitted via Instagram with the #realsies hashtag, for a chance to win a year’s supply of the mascara. A mosaic was created from these images on a responsive design microsite linking to the they’re real! product page. The brand also encourages those who use their brow products or services to tag Instagrams with #benebrows. Some 5,100 perfected arches have found their way to the platform. Benefit kicked off the new year partnering with the anti-bullying “Love Is Louder” movement to deliver a week of daily challenges designed to celebrate inner beauty. The brand joined forces with Beauty vloggers and celebs such as “selfie queen” Kendall Jenner to mobilize fans to capture themselves with the #InnerBeauties hashtag on Instagram. A gallery showcases the 11,900 “Benebabes” that have joined the REALvolution by tagging their #realsies on Instagram. #realsies and #benebrows monthly winners are featured in the gallery and on the brand’s Facebook page. 2,300 fans accepted Benefit’s Inner Beauty Challenge. Their images were aggregated in galleries on Facebook and the campaign microsite. From the Get #benebrows Now! Facebook custom tab or microsite, fans can upload selfies to win and search for nearby Brow Bar locations. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  16. 16. 16 February 10, 2014Intelligence Report: Instagram Key Findings Insta-Video Seventy-two percent of prestige brands post Instagram videos, up from 26 percent in July 2013. However, video posts account for only 4 percent of brand content. The expertise required to produce high quality short-form video remains a barrier for most brands. On average brand accounts post six images per week, versus less than one video post every two weeks (0.38 per week). Engagement on photo posts averages 1.5 times that of Instagram video posts. Reposted advertising and contest posts generate the most engagement. It is not a coincidence that the run time for Instagram videos is 15 seconds, the minimum length of a television commercial. It is rumored that the platform will sell Instagram video ads similar to television airtime. Instagram Engagement: Top 10 Videos August–December 2013, Account > 5,000 followers Instagram Engagement: Top 10 Photos August–December 2013, Account > 5,000 followers Instagram Engagement: Photos vs. Videos August–December 2013, n=364, Account > 5,000 followers Advertisement Contest Photos Videos 5.16% 4.87% 3.79% 3.71% 3.46% 3.32% 3.12% 2.97% 2.90% 2.89% 10.43% 8.36% 65.55% 45.22% 8.25% 7.34%7.48% 25.17% 12.40% 11.77% 2.49% 1.65% Average Like Engagement 0.05% 0.05% Average Comment Engagement 1.27% 0.85% Average Overall Engagement For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  17. 17. 17 February 10, 2014Intelligence Report: Instagram Flash of Genius Swarovski #InstaSparkle and Giorgio Armani #SiByArmani In July 2013, Swarovski was among the first brands to launch an Instagram video contest. In 11 days, the brand gained 8,000 new followers and 6,366 submissions via its #InstaSparkle hashtag. In August 2013, Armani partnered with popular fashion bloggers to produce videos promoting its new perfume, Si by Armani. The videos, heralded as the first Instagram video advertising campaign, were tagged with the #SiByArmani hashtag and posted across the bloggers’ feeds. A video posted by Chiara Ferragni, who tallied more than a million Instagram followers received more than 28,000 likes. Popular fashion blogger Chiara Ferragni’s #SiByArmani video received 28,000 likes. 6,000 photos and videos were submitted using #InstaSparkle. Swarovski’s Instagram account grew 19 percent during the #InstaSparkle contest. 217 215 210 322 250 193 210 242 294 366 452 501 219 314 3,055 1,224 1,291 690 497 332 July 1 July 2 July 3 July 4 July 5 July 6 July 7 July 8 July 9 July 10 July 11 July 12 July 13 July 14 July 15 July 16 July 17 July 18 July 19 July 20 InstaSparkle contest ran from July 8–July 19 @official_swarovski: New Instagram Followers July 1–July 20, 2013 For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  18. 18. 18 February 10, 2014Intelligence Report: Instagram Key Findings Visual Commerce The Next Frontier With consumers more likely to trust and take action based on user-generated content than brand advertising, email, or social media,11 Instagram provides velocity in the purchase funnel. However, reticent to take users out of the app experience, Instagram prohibits the use of links in photo captions and comments, undermining the immediate return on investment on the platform. Some brands have attempted workarounds, and startups have stepped in to fill the void by integrating Instagram photos into e-commerce experiences outside of the native platform. Additionally, the new Instagram direct messaging feature offers brands the opportunity to respond to comments expressing a desire to purchase. Accounting for nearly a quarter of social commerce sales despite having only 5 percent of Facebook’s users,12 fellow visual platform Pinterest provides a benchmark for Instagram’s potential. Pinterest users’ average order value is 126 percent higher than Facebook’s.13 The impact of user-generated visual commerce is correlated to the proximity to point of purchase, highlighting the importance of on-site Instagram integration. Yet, more than a third (37 percent) of prestige brands with Instagram accounts fail to link to them from their brand sites, and just 14 percent leverage any form of user-generated Instagram content on site. Only 11 percent of brands provide social streaming, even though it is a relatively easy means of incorporating Instagram content. 11. “Just Do It? Consumer Trust In Advertising And Willingness To Take Action,” Nielsen, September 26, 2013. 12. “2013 Social Commerce Breakdown,” AddShoppers, January 2014. 13. “How Pinterest Tops Facebook In E-commerce,” Internet Retailer, Zak Stambor, January 6, 2014. Brand and user- generated content streaming on Sally Hansen’s brand site can be filtered by platform. Driving to e-commerce, @topshop includes product codes, prices and exclusive promo codes on its posts to its nearly 1.8 million followers. Instagram Brand Site Integration Percentage of Brands January 2014, n=249“Engagement is important, but there is a universe of value that most brands have yet to unlock with customer-generated visual content: e-commerce.” – Pau Sabria Co-founder, Olapic Instagram Main Account On-Site Instagram Link On-Site User-Generated Instagram Content On-Site Branded Instagram Content 86% 54% 14% 11% By commenting “Buy,” Chirpify members can purchase select products they see on Instagram. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  19. 19. 19 February 10, 2014Intelligence Report: Instagram Key Findings Visual Commerce = Conversion By showcasing user-generated photos on brand site home pages, galleries, product detail and checkout pages, brands can tap into the power of visual commerce. Visual commerce company Olapic reports that brands experience a 5 to 7 percent increase in conversion rate and a 2 percent increase in average order value14 when they incorporate, or link to, UGC on product pages. A recent study of more than 130,000 Instagram posts conducted by researchers at the University of Wisconsin found that higher shopping rates were achieved on unfiltered photos containing yellow or blue, photos with longer captions that did not contain question marks or exclamations, and photos submitted by popular Instagrammers who posted less frequently.15 Higher engagement rates, however, were achieved on unfiltered photos containing green, photos with captions that include question marks, and photos posted by high-volume sharers. This suggests that the strategy for producing content to generate engagement on Instagram differs from the strategy for curating content for commerce. Frequently updating photos within curated collections was also shown to drive sales. 14. Olapic, January 2014. 15. “Curating Online Product Displays from Shared Social Media Photos: A Theory- Based Algorithm,” Purushottam Papatla and Nima Jalali, University of Wisconsin December 2013. Source: “Curating Online Product Displays from Shared Social Media Photos: A Theory-Based Algorithm,” Purushottam Papatla and Nima Jalali, University of Wisconsin December 2013. Photos of real people replace reviews on Desigual’s product pages. Curated from Instagram, Twitter, and Pose, the #COACHFROMABOVE microsite features a gallery and map of fashionistas sporting Coach shoes around the globe. Instagram Variables Optimizing Instagram for Engagement Optimizing Instagram for E-commerce Color Green, not bright Yellow or blue, not bright Captions Include question marks Longer captions, no question marks or exclamations Filters None (exception: Lo-Fi) None (exception: “other” category) Users High-volume sharer High follower number, low-volume sharer T ??? “Engagement and conversion have separate– and often contradictory–triggers. As such, brands should use a mix of criteria when curating Instagram user photos, in alignment with their goals for the destination into which the photos are curated.” – Pau Sabria Co-founder, Olapic For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  20. 20. 20 February 10, 2014Intelligence Report: Instagram Flash of Genius West Elm West Elm’s “Share Your Style” gallery has become a destination for user-generated interior decorating inspiration. Launched in September 2013, the gallery has attracted more than 500,000 visitors16 . Filters, including the ever-popular pets, allow users to refine their selection. The gallery allows potential customers to envision pieces in their own homes and gives existing owners new tools to style and use pieces. West Elm recycles Instagram content across its online and print assets. Pictures from store Instagram accounts are featured on store locator pages. Product pages currently promote the gallery and encourage users to submit photos, with plans for full image integration. The most recent monthly West Elm catalog featured user- submitted Instagrams. 16. Olapic, January 2014. West Elm’s shoppable Share Your Style gallery boosted site visits. Photos from West Elm store Instagram accounts are integrated into the store directory pages on westelm.com. The January 2014 West Elm catalog featured user Instagrams and encouraged readers to submit their own. Product pages promote the Share Your Style gallery and encourage shoppers to submit their own photos. “We predict that in the near future, brands featuring visual user-generated content alongside brand-created content will be the rule rather than the exception.” – Pau Sabria Co-founder, Olapic For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  21. 21. 21 February 10, 2014Intelligence Report: Instagram Flash of Genius Brand owned social network FP Me fosters conversation and commerce—user submitted pics are shoppable and sharable. Popular user submitted photos stream on Urban Outfitters and Free People’s homepages. A shoppable on-site gallery houses the best of Urban Outfitters user submitted pics. With #UOSTYLE @UOEurope encourages seflies from the changing room stall. #UOSTYLE has been used 5,275 times on Instagram. Popular pictures and collections from FP Me are prominently featured on product pages. Urban Outfitters and Free People Instagram’s “selfie generation” is the ideal demographic for sister companies Urban Outfitters and Free People. The brands boast more than 1.1 million and 950,000 followers on the platform, respectively, and each brand posts more than 25 times per week. The #UOONYOU hashtag has been used over 23,000 times on Instagram by Urban Outfitters customers to showcase their style and populate a shoppable on-site gallery. The gallery boosted time on site by 45 seconds, and generated a 35 percent engagement rate and 15 percent conversion rate.17 Urban Outfitters Europe (@UOEurope) introduced photo- sharing into the changing room, encouraging consumers to Instagram their outfits while trying them on. Free People featured user Instagram images on product pages as early as July 2012. With the February 2013 launch of its online style community FP Me, Instagram has become central to Free People’s e-commerce strategy and built its own social network. Through FP Me, store stylists, fashion bloggers, and consumers can create profiles, share style pics, create collections, and like, comment, share, and follow each other’s profiles. Instagram integration makes submitting photos seamless, and FP Me is also incorporated into Free People’s mobile app. Within FP Me, looks are shoppable and galleries of popular user-submitted pictures and collections featuring items are prominently featured on product pages. Within the first three months 10,000 photos were uploaded to FP Me; as of January 2014 there are close to 25,000. The retailer experienced a 42 percent increase in the same-session conversion rate.18 Pictures submitted with designated hashtags are also featured in Free People’s monthly online trend catalogs. 17. “Fostering Engagement with User Generated Content,” RJMetrics, October 2013. 18. “FP Me: 10k photos uploaded to Free People’s online style network since March launch,” Juliana Reyes, Technically Philly, May 30, 2013. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  22. 22. 22 February 10, 2014Intelligence Report: Instagram Flash of Genius Lancôme Lancôme’s Project #bareselfie campaign for the newly launched DreamTone serum product line dared women to post pictures of themselves without makeup. Within two months of the August 2013 campaign launch, more than 500 photos were submitted and the user-generated gallery posted a 4 percent conversion rate, generating 50 percent of DreamTone’s sales.19 The brand partnered with female blogging community SheSpeaks, and influencer marketer Style Coalition, to solicit bloggers to review DreamTone samples. The bloggers documented their cosmetic journey with before and after #bareselfies. A collage of 12 bloggers’ before and after #bareselfies was in an exclusive interactive advertorial for MarieClaire.com. 19. Olapic, January 2014. An interactive ad on MarieClaire. com featured blogger #bareselfies and “skin stories.” 500 women accepted Lancôme’s dare to submit #bareselfie photos of themselves without any makeup. The shoppable Project #bareselfie gallery and Lancôme’s DreamTone microsite drove sales of the new product. SheSpeaks hosted a Twitter party to recruit bloggers to take #bareselfies and review DreamTone. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  23. 23. 23 February 10, 2014Intelligence Report: Instagram Key Findings Facebook Integration Parent company Facebook serves as a promotion, content syndication and content solicitation vehicle for Instagram. Nine out of ten Instagram video shares occur on Facebook,20 and one percent of brand posts to Facebook are from Instagram.21 Slightly more than half of prestige brands feature a Facebook custom tab highlighting Instagram content. 20. Unruly, October 2013. 21. “How Does Posting Via Instagram Impact Engagement on Facebook?” Edgerank Checker, October 23, 2013. Celebrating its loyalty program’s 30th anniversary, a Neiman Marcus contest uses Instagram hashtag #NMInCircle and a Facebook custom tab to accept submissions, display entries, and announce winners. Select photos uploaded through Facebook are featured on The Ritz- Carlton Instagram account. A Facebook photo album of pictures submitted by Cole Haan Instagram followers is among its most popular content and has been liked 2,300 times. Carol’s Daughter uses Facebook to promote Instagram-exclusive offers and page content and often reposts its followers’ Instagrams. Instagram Facebook Integration Percentage of Brands December 2013, n=249 89% 54% 6%9%12% Instagram Main Account Instagram Custom Tabs Promoted Instagram in Last 30 Days Solicited Instagram UGC in Last 30 Days Curating/Displaying Instagram Content Custom Tabs For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  24. 24. 24 February 10, 2014Intelligence Report: Instagram Flash of Genius White House | Black Market #WearWhatWorks Proving selfies aren’t just for teens, as far back as 2009 White House | Black Market noticed customers sharing pictures of themselves on Facebook in their clothes. Looking to harness that natural social sharing inclination, the brand partnered with Olapic to curate, publish, and enable shopping on user-submitted photos on the brand’s e-commerce site and Facebook page using the #WearWhatWorks hashtag. The #WearWhatWorks campaign launched in August 2013 with the support of television advertising, in-store signage, print catalog features, email marketing, paid social advertising, and a sweepstakes that garnered more than 75,000 entries for a chance to win a $2,500 gift card.22 Within the first month, the use of the hashtag grew by 42 percent23 , and by October, the brand had received 12,000 photo submissions from Facebook, Twitter, Instagram, and the brand site.24 Over 1,600 photos bear the #WearWhatWorks hashtag on Instagram. The photos are aggregated in a shoppable on-site gallery. A gallery of 4,700 images is also featured on the brand’s Facebook page, where fans can submit and shop images. Based on the initial success, White House | Black Market continues to extend the gallery, incorporating new hashtags, including the latest, #GOODJEANS. To herald the opening of its first store in Canada, the brand launched the #feelbeauty hashtag, donating a dollar to the Children’s Miracle Network Hospitals for each image received. The retailer plans to further integrate visual commerce by placing user-submitted images on product pages. 22. “White House Black Market Turns Customers Into Stylists With #WearWhatWorks,” Alicia Fiorletta, Retail TouchPoints, November 20, 2013. 23. Olapic, January 2014. 24. Ibid The #WearWhatWorks gallery receives an average of 20 photo views per visit. A Facebook custom tab also features the shoppable #WearWhatWorks gallery. The brand site home page and Facebook header graphic continue to promote the hashtags. A dollar was donated to the Children’s Miracle Network Hospitals for each #feelbeauty photo. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  25. 25. 25 February 10, 2014Intelligence Report: Instagram Key Findings Instagram Advertising With the release of the November 1, 2013 sponsored post from Michael Kors, Instagram became the latest social platform to launch an advertising product. The move strengthens Facebook’s mobile advertising position as it continues to eat away at Google’s dominant share of mobile ad revenue. Fueled by nearly ubiquitous smartphone penetration and utilization of mobile-first apps like Instagram, the 21.7 percent of digital ad spend allocated to mobile in 2013 is expected to rise to 48.4 percent by 2017.25 Unlike big brother Facebook, Instagram is currently not utilizing third-party exchanges, and only sells ads direct. Careful not to alienate its community, the platform has slowly rolled out ads and instituted internal ad reviews for quality control. Instagram was very selective with its initial set of advertising partners, which, in addition to Michael Kors, include Adidas, Ben & Jerry’s, Burberry, General Electric, Levi’s, Lexus, Macy’s, PayPal, and Starwood. Ad targeting is currently limited only to age and gender, but Instagram continues to develop its algorithm to include factors such as location and other accounts followed. Initial results indicate Instagram ads are effective at providing reach, boosting community sizes, and increasing awareness. Even with limited exposure, brands on average saw a 32 percent increase in ad recall and a 10 percent lift in brand message awareness.26 Reportedly, more than 5 percent of ad impressions converted to likes.27 25. “Mobile Gains Greater Share of Search, Display Spending,” eMarketer, August 21, 2013. 26. “First Look—Measuring the Effectiveness of Brand Advertising Campaigns on Instagram,” Instagram, December 2013. 27. “Over 5% Of Instagram Ad Views Have Led To Likes, Signaling Big Potential,” Josh Constine, TechCrunch, November 6, 2013. Reach: 9.8 million U.S. consumers Ad Recall: 33-point lift Brand Awareness: 17% increase Source: Instagram, December 2013. Reach: 4.4 million U.S. consumers New Followers: 33,000 in 18 hours, 16x average Likes: 218,000 in 18 hours, 16x average Source: Nitrogram, November 2013. Reach: 7.4 million U.S. consumers Ad Recall: 24-point lift Source: Instagram, December 2013. Reach: 5.3 million New Followers: 14,000 in 48 hours, 75x average Likes: 264,000 total, 70x average engagement Engagement: +128% 30 days after Source: L2ThinkTank For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  26. 26. 26 February 10, 2014Intelligence Report: Instagram Flash of Genius Macy’s Floats Instagram Advertising In addition to live-posting images from its annual Thanksgiving Day Parade, Macy’s aggregated fan Instagram and Twitter posts with the #macysparade hashtag on the parade’s microsite. More than 22,000 #macysparade photos were posted to Instagram. @macys garnered 1,400 new Instagram followers on Thanksgiving Day. Building on the momentum, Macy’s, one of Instagram’s pilot advertisers, chose to debut its first ads on the heels of the parade. The retailer released ads on November 29th and December 1st, receiving 156,173 likes (65.6 percent engagement) and 107,563 likes (45.2 percent engagement), respectively. The average engagement on Macy’s ad posts was 70 times that of the brand’s non-sponsored Instagram posts in November and December. Assuming 5 percent of impressions converted to likes, the ads reached a combined audience of 5.3 million. Within the first 48 hours of the November 29th ad @macys gained nearly 14,000 new followers, growing 15 percent, 75 times the average daily increase for the previous 30 days. Over the two weeks in which the ads ran, nearly 42,000 new followers were added. In the 30 days following the first ad, the @macys account engagement rate increased 128 percent over the previous 30 days, suggesting the long-term effects of participating in advertising. Macy’s Daily Instagram Follower and Engagement Growth November–December 2013 Engagement on #macysparade posts was 1.3 times that of other November posts, and ad posts were 70 times. The Macy’s Thanksgiving Day Parade microsite aggregated #macysparade Twitter and Instagram posts. Macy’s ads spurred follower and engagement growth. 2 3 Nov 1 1,000 0 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 0.20% 0.00% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 1.80% Dec 1Nov 15Nov 8 Nov 22 Dec 8 Dec 22Dec 15 Dec 31 NewFollowersPerDay EngagementRate 1 3 2 22k #macysparade pics 1,400 new followers Thanksgiving Day 41,800 new followers (+44%) within 2 weeks of ads 30 days after ads, engagement rate +128% Macy’s Instagram ads posted 11/29/13 and 12/1/13 14,000 new followers in first 48 hours: +15%, 75x average daily increase 1 New Followers Engagement Rate For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  27. 27. 27 February 10, 2014Intelligence Report: Instagram Flash of Genius Starwood Hotels & Resorts Guest Galleries Instagram’s geotagging capability makes it ideal for travelers and travel brands. Instagram’s photos and videos act as an extension of reviews, providing another way to inspire, document, and share travel experiences. City hashtags allow prospective travelers to explore, while brands use the platform to showcase their properties. After witnessing an explosion in mobile bookings, and inspired by the more than 40,000 Instagrams per month already being posted by its guests, Starwood Hotels & Resorts is integrating Instagram photos and videos into all of its more than 1,150 property websites.28 Using the #SPGLife hashtag, guests can add to the galleries customized for each of Starwood’s nine brands. Book Now buttons on gallery posts convert browsers to bookers. As of late January, more than 8,500 Instagrams were hashtagged #SPGLife. Extending its prowess, on January 24th, Starwood became the first travel brand to advertise on Instagram. The ads feature properties across its portfolio and link to both the @spg and individual brand accounts.29 28. “Starwood Hotels & Resorts among the First to Feature Instagram on All Property Websites Showcasing the 40,000 Images Guests Capture and Share Every Month,” Starwood Hotels & Resorts Worldwide, Inc., December 11, 2013. 29. Starwood Is the First Travel Brand to Advertise on Instagram,” Jason Clampet, Skift, January 23, 2014. Instagram posts in the Guest Galleries are filterable by suites, features, rooms, and dining, providing an inside look at Starwood properties from the guest’s perspective. Book Now buttons on posts in the Guest Galleries drive conversion. Scheduled to run from January 24th through February 4th, Starwood ads incorporate the #SPGLife hashtag. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  28. 28. 28 February 10, 2014Intelligence Report: Instagram Key Findings Instagram Direct A direct shot at rival Snapchat, Instagram’s new feature direct messaging opens the platform as a customer service vehicle. Within hours of the December 12, 2013 announcement, Gap, Benefit Cosmetics, and Michael Kors had launched contests to test the capability. Brands are primarily using Instagram Direct to deliver personalized messages in exchange for user-generated content and to notify Instagram contest winners. Model Joan Smalls was @EsteeLauder’s guest Instagrammer. The #MKDirect hashtag was used 850 times in an attempt to get a direct message from Michael Kors. @gap was the first brand to use Instagram Direct. 1 For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  29. 29. 29 February 10, 2014Intelligence Report: Instagram Flash of Genius Estée Lauder For three days in December, Estée Lauder turned over its Instagram account to its spokesmodel, Joan Smalls, who has an Instagram following four times that of the Beauty brand. On her final day as guest Instagrammer, Smalls promised in English and Spanish a surprise from the Estée Lauder account via Instagram Direct to the first 100 people posting to Instagram with #perfectpresents. Over the three days, account engagement was 2 percent higher than the previous month and 2,000 new followers were added. @EsteeLauder Daily Instagram Follower and Engagement Growth November–December 2013 New Followers Engagement Rate 700 600 500 400 300 200 100 0 1.10% 1.08% 1.06% 1.04% 1.02% 1.00% 0.98% 0.96% NewFollowersPerDay EngagementRate Nov 25 Nov 27 Nov 29 Dec 3Dec 1 Dec 5 Dec 7 Dec 9 Dec 11 Dec 13 Dec 15 Dec 17 Dec 19 Dec 22 Model @joansmalls begins as guest Instagrammer Promised 1st 100 #perfectpresents posts a special surprise via Instagram Direct In three days added 2,000+ new followers The first 100 people to post a photo with #perfectpresents were promised an Instagram Direct surprise. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  30. 30. 30 February 10, 2014Intelligence Report: Instagram The Team Scott Galloway Professor of Marketing, NYU Stern Founder, L2 Scott is a Clinical Professor at the NYU Stern School of Business, where he teaches brand strategy and digital marketing, and is
the founder of L2, a think tank for digital innovation. Scott is also the founder of Firebrand Partners, an operational activist firm that has invested more than $1 billion in U.S. consumer and media companies. In 1997, he founded Red Envelope, an Internet-based branded consumer gift retailer. In 1992, Scott founded Prophet, a brand strategy consultancy that employs more than 250 professionals in the United States, Europe, and Asia. Scott was elected to the World Economic Forum’s Global Leaders of Tomorrow. Scott has served on the boards of directors of Eddie Bauer (Nasdaq: EBHI), The New York Times Company (NYSE: NYT), Gateway Computer, and UC Berkeley’s Haas School of Business. He received a B.A. from UCLA and an M.B.A. from UC Berkeley. Pau Sabria Olapic Pau is co-founder and CEO of Olapic, a company that helps brands and retailers increase sales by integrating customer photos and videos into the shopping experience. Sabria studied Electrical Engineering at Universitat Politècnica de Catalunya in Barcelona and graduated with a thesis in distributed video coding at Purdue University, Indiana. He then joined The Boston Consulting Group, where he worked for 3 years and co-founded Olapic while completing his MBA at Columbia University. Maureen Mullen Director of Research & Advisory, L2 Maureen leads L2’s research and advisory practice, where she helped develop the Digital IQ Index® . She has benchmarked the digital marketing, e-commerce, and social media efforts of more than 300 brands across pharma, auto, luxury, specialty retail, beauty, and the public sector. Maureen also has led digital strategy consulting engagements for a variety of Fortune 1000 clients. Before joining L2, Maureen was with Triage Consulting Group and led managed-care payment review and payment benchmarking projects for hospitals, including UCLA Medical Center, UCSF, and HCA. Maureen has a B.A. in Human Biology from Stanford University and an M.B.A. from NYU Stern. R. Danielle Bailey L2 Danielle began her career at The Home Depot, Inc., where she led a variety of internal consulting engagements focused on supply chain, merchandising, and in-store process improvement. She went on to manage the implementation of award-winning mobile initiatives for several large media clients, including The New York Times Company, NBCUniversal, Disney/ABC, Maxim magazine, and Zagat. At L2 she has benchmarked the digital competence of brands spanning the specialty retail, public sector, pharma, wine and spirits, travel, and financial services industries. Danielle has a B.S. in Systems Engineering from the University of Virginia and an M.B.A. from NYU Stern. Qiuping (Andrea) Wang L2 Andrea has five years of working experience in telecom industry, helping brands like LG and Motorola develop integrated marketing communication strategies and campaigns for the Chinese market. During the MBA exchange program at NYU Stern she demonstrated a strong interest in digital marketing. She has a B.A. in Journalism and Communication from Peking University and an M.B.A. from Hong Kong University of Science and Technology (HKUST). Joy Duo L2 Joy holds a B.S. in Economics from University of International Business and Economics (UIBE) in Beijing and is currently a second year M.B.A student at ESADE Business School in Barcelona. She began her career as an analyst at Mercer Consulting, where she also led the Beijing office’s global client management. She recently completed the M.B.A exchange program at NYU Stern developing a strong interest in marketing and technology. She is also a part-time fashion editor, covering the Chinese fashion market and social media for a Milan-based business intelligence company. Carol Ho L2 Carol has a B.Sc in Biomedical Science from King’s College London and an M.B.A. from the Hong Kong University of Science and Technology (HKUST). She began her career at Pfizer, where she led cross-functional teams to deliver global projects on regulatory approvals, streamline processes and establish the Asia hub. While pursuing her M.B.A., Carol worked part-time supporting the digital marketing and E-commerce functions for a luxury brand. Aaron Bunge L2 Aaron is an art director who specializes in data visualization, collateral, branding and identity, packaging, and web design. His approach is aesthetic and functional, characterized by clear, intelligent design appropriate to the project at hand. He began his career tailoring projects for the Chinese, Australian, and U.S. markets across multiple design disciplines and in multiple languages. Aaron has a B.F.A. in Graphic Design from Iowa State University. Nary Han L2 Nary is a designer specializing in data visualization, branding and identity. She has experience in areas ranging from motion graphics, interactive and environmental experiences, and graphic design. She has worked in many areas to design, conceive, and execute identities for several clients including Fidelity, Vivo Health & Wellness, and NASDAQ. She graduated with a B.F.A. from Parsons School of Design. Radhika Patel L2 Radhika Patel is a graphic designer who specializes in publication design as well as data visualization. She has experience in motion graphics, electronic media, experience design, and animation. Before joining the L2 team she worked at The Royce J. and Caroline B. Watts Museum in West Virginia. Radhika received her B.F.A. in Graphic Design from West Virginia University. A special thank you to Stasha Rosen, Jenny Shen, and Bing Wu. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  31. 31. 31 February 10, 2014Intelligence Report: Instagram About L2 ? L2 is a think tank for digital innovation. We are a membership organization that brings together thought leadership from academia and industry to drive digital marketing innovation. RESEARCH Digital IQ Index® : The definitive benchmark for online competence, Digital IQ Index® reports score brands against peers on more than 600 quantitative and qualitative data points, diagnosing their digital strengths and weaknesses. L2 Collective® : Series of benchmarking reports designed to help member brands better understand resources, human capital, budgets, and priorities supporting digital strategies. EVENTS Forums: Big-picture thinking and game-changing innovations meet education and entertainment. The largest gatherings of prestige executives in North America. 300+ attendees Clinics: Executive education in a classroom setting with a balance of theory, tactics, and case studies. 120–180 attendees Working Lunches: Members-only lunches led by digital thought leaders and academics. Topic immersion in a relaxed environment that encourages open discussion. 40–80 attendees CONSULTING Advisory Services: L2 works with brands to garner greater return on investment in digital initiatives. Advisory work includes Digital Roadmaps, Social Media Strategy, and Organizational Strategy engagements. MEMBERSHIP For membership info and inquiries: membership@L2ThinkTank.com Upcoming Events BREAKFAST & LUNCH: INSTAGRAM February 13, 2014 · NewYork City LUNCH: SPIRITS February 27, 2014 · NewYork City BREAKFAST: EU BEAUTY March 5, 2014 · Paris March 7, 2014 · London CLINIC: PROGRAMMATIC MEDIA March 11, 2014 · NewYork City LUNCH: HAIR CARE March 18, 2014 · NewYork City Upcoming Research: Q1 2014 DIGITAL IQ INDEX® REPORTS: Beauty: France Food Beer Beauty: UK Spirits L2 INTELLIGENCE REPORTS: Amazon Mobile Tablets For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.
  32. 32. A THINK TANK for DIGITAL INNOVATION 155 Wooster Street, 2nd Floor New York, NY 10012 L2ThinkTank.com info@L2ThinkTank.com © L2 2014 L2ThinkTank.com Reproductions Prohibited This report is the property of L2 Think Tank. No copyrighted materials may be reproduced, redistributed, or transferred without prior consent from L2. L2 reports are available to L2 Members for internal business purposes. For sole use of andrea.wang@ust.hk © L2 2013 L2ThinkTank For sole use of andrea.wang@ust.hk. Circulation of the report violates copyright, trademark and intellectual property laws.

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