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When Facebook acquired Instagram in 2012 for $1 billion, many were shocked at the price paid for a company that only had 13 employees. Today, that investment appears to be a very wise decision, and the latest figures from Marin Software show that the image-centered social network accounts for 19.5% of Facebook’s ad spend among its clients.

A separate report [download page] from Merkle provides weight to this figure. It estimates that Instagram accounts for 19% of ad dollars spent across Facebook’s properties, along with more than one-quarter (27%) of the total impressions but a lower proportion of clicks (15%).

Compared to its parent social network Facebook, which has suffered from trust issues, social media users seem positive about brands on Instagram. Research from Facebook IQ shows that almost 9 in 10 Instagram users claim they have taken some kind of action after seeing a product ad, while one-third had become more interested after seeing a product via Instagram Stories.

As a format, Stories are attracting a lot of attention, both from advertisers and from social media users. Marin’s data shows a slight decrease in terms of the percentage of Instagram ad spend that goes towards Stories, with Q1 2019 seeing 34% of Instagram budgets allocated this way (down from 36% in Q4 2018). The latest earnings call [PDF] from Facebook revealed that 3 million advertisers had used Stories ads across Facebook products.

Outside of Instagram, short-lived videos are also one of the key formats of Snapchat (which, for the time being, holds its place as the favored social network of teens) and the fast-rising social network TikTok.

Other key Facebook averages from Marin Software’s data, which is based on the performance seen in longer-term clients, include:

  • The CPM on Facebook’s properties averaged $3.16 in Q1 2019, down from $3.42 in Q4 2018 and $4.31 in Q3 2018.
  • The average click-through rate (CTR) was 1.45% in Q1 2019, up from 1.17% in the previous quarter.
  • Cost-per-click (CPC) fell to $0.23, down from a high of $0.29 in Q3 and Q4 of 2018.

About the Data: Data from Marin Software is based on aggregated data from Marin Software customers who invest billions of dollars in combined annualized as spend on paid search, social, mobile and e-commerce and who have been active on Marin’s platform for the past 5 quarters.

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