Since Facebook doesn’t talk much about money they make off Instagram, there are many speculations made.

The most recent being MofettNathanson, an analyst firm which predicted today that Instagram will bring in $600 million in revenue over the next year. This number is only expected to increase within the next two to three years with revenue forecast at $1.8 billion. When Instagram is considered “mature,” it is predicted it will make $5 billion dollars in revenue. This of course is on the conservative side stated MofettNathanson, which believes Instagram could be making upwards of $11 billion per year.

Why are these forecasts so high?  

Instagram has a large pool of data from its parent company, Facebook and is able to target ads to very specific audiences. What does this mean for advertisers? They will pay more for ads with increased targeting options which drives marketers to Facebook daily.

Why is there so much hype about Instagram advertising

Since Facebook has been slow to ramp up Instagram’s advertising initiatives and recently announcing an all new “self service” platform that is available to all advertisers starting at the end of the month the whole world is talking all about Instagram advertising. A lot of this excitement comes from Instagram’s new 30 second video ads which could pull in the big bucks from traditional TV advertising budgets! 

How did Facebook turn Instagram into a $5 billion business?

Instagram will bring in $600 million in advertising revenue over the next year

How much will Facebook make off Instagram revenues?

Instagram targeted advertising efforts expected to make $5 billion a year

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