Social networking service Instagram is actively targeting the Korean mobile ad market.
The Facebook-owned Instagram, which has 200 million global users per day as of April, is strengthening its services in the nation, according to major overseas media outlets and industry sources on Aug. 18.
Last April, the SNS service provider launched @music, a new account that provides various types of music-related content to users, and also introduced No Brain, a first-gen Korean indie band, to music fans around the world.
As K-pop and K-drama stars, the driving forces behind the Hallyu (Korean Wave), are confirmed to have far-reaching influence in Instagram, the SNS service provider is expected to augment its power in the Korean market.
According to data compiled by Instagram from May 2014 to May 2015, Korean stars have 150 million followers worldwide.
A spokesperson for Instagram said, "Big Bang's G-Dragon secured 4.5 million followers, and 97 million comments were posted on the blog of EXO's Chanyeol through 154 pictures during the cited period." The official added, "Amid K-pop fever in the world, the influence of Hallyu stars is strong on Instagram." Hallyu is a Korean word meaning tsunami, and is used to refer to the impact that Korean pop culture has on the rest of the world.
Instagram ads will also reportedly begin in earnest in the nation in as early as Sept.
With companies worldwide waging a mobile ad war, Instagram is providing mobile advertising services in the U.S, the U.K., France, Germany, Brazil, Canada, Australia, and Japan. It recently announced a plan to introduce its ad services to more countries through its own business blog. Industry sources are saying that Korea is included in the list of countries.
The core of Instagram's ads is to induce users to actively participate in Instagram by creating buttons for the purchase and installation of apps, and memberships.
Market research firm eMarketer recently reported that Instagram would earn US$595 million from mobile ads this year.
eMarketer said, "Instagram's advertising business will continue to grow for years," adding, "It will post US$2.81 billion of profits from ads in 2017, accounting for more than 10 percent of Facebook's total ad profits." The number exceeds sales from mobile ads posted by Google and Twitter combined.
The competitiveness of Instagram ads are widely acknowledged to be hashtags. Among Instagram users, 80 percent are in their mid-teens to mid-thirties, and it is possible to identify their desire to purchase by analyzing hashtags.
An official at a local SNS service provider noted, "The great advantage of advertising on Instagram is that it is possible to target a specific audience by analyzing users," adding, "Another advantage is that people in their twenties or thirties with big purchasing power are Instagram's main users."
Naver and Daum Kakao are, therefore, showcasing an increasing number of hashtag-based mobile services, but observers say that the introduction of Instagram ads to the nation will be a serious blow to local mobile SNS service providers.