Selling sponsorship against their accounts has long been the main way creators and publishers earn money from Instagram. But since the platform's beginning publishers have tended to treat Instagram as a platform for brand building and engagement as opposed to one that they look to drive significant portions of their revenue. Now the platform plans to deliver on the medley of monetization tools its had in the pipeline giving creators and publishers more ways to unlock revenue from the platform. 

Unlike other social video platforms, like TikTok and YouTube – which honed in on a single video format from the beginning, Instagram has it all. Reels for shorts (its answer to TikTok), stories for fleeting updates, IGTV for produced and longer form video content (to rival YouTube), and then there’s live and in-feed videos. With such a breadth of available video content, it wouldn’t be wholly unfair to describe the platform as a jack of all trades, master of...no, that’s taking it too far, but you get me. In fact, as reported by Digiday this week – the platform’s status as the all-inclusive video platform could be about to become, “more of a feature than a bug” as it looks to adopt a similarly multifaceted approach to enabling video makers, from individuals to publishers, to monetize.

IGTV revenue share model

Compared with other social video publishing platforms, Instagram has been slow to offer its video makers and publishers ways to monetize. As it looks to make up lost ground, it’s expected to roll out the long-anticipated revenue share model that it started testing more or less this time last year. 

Who is this monetization tool relevant to and why?

This monetization method is relevant across the board – from individual content creators to media companies, but it is potentially the only one of the newly proposed tools that will unlock levels of revenue that matter to larger publishers. This said, it has only been tested with individual creators so far. With the terms of the revenue share model the same as YouTube’s (with 55% of ad revenue going to the creator, individual or otherwise), its roll-out would put the two platforms in direct competition. This is likely to be the reason it’s been such a long time coming; Facebook wants to get it right. 

In order to compete in the space, Instagram has to balance the promise of high view counts and engagement with a good viewer experience – which might look like giving viewers the option to skip a portion of ads – with advertiser guarantees that their ads wouldn’t appear alongside inappropriate content. The stakes are high because if Instagram was to get moderation right (something YouTube has historically had issues with) brands could feasibly start prioritising the creation of vertical video over landscape. This is a pretty compelling reason why instagram has yet to introduce the model to media companies; it’s important that revenue has the potential to be high from the off with minimal teething problems.  

If Instagram does roll this money-making method out to media companies in the near future, as it's tipped to do, these companies will be focused on growing video views and watch time in the same way they do on YouTube. And, of course, localization should become a key part of their strategy. Translating existing content to reach new audience being a failsafe way to maximise the value of content.

Gated content/subscription

Instagram’s way of mimicking the direct payments of platforms like Patreon, Memberful or Substack is its badges in Instagram Live. The badges let loyal followers tip content creators directly. According to Digiday, there is some suggestion that as well as badges, designed to be used by individual or smaller scale creators, the platform could introduce gated content or content to which people have to subscribe for access to exclusive content – like YouTube's Premium membership.

Who is this monetization tool relevant to and why?

Some creators have savvily been using the ‘close friends’ function as a subscription service for years, but the suggestion (teased by Adam Mosseri at Instagram’s Creator Week on June 10, and reported by Digiday) that Instagram might formalize paid subscriptions to video content is interesting for publishers because it has the potential to allow them to segment paid and unpaid content on their Instagram accounts, just as many of them do on their own platforms already. For social-first publishers, this method has the potential to be particularly attractive, in that it would allow them to diversify their means of earning in-platform. 

Shopping/commerce tools 

The platform has started testing native affiliate link tools that will allow creators in the U.S. to earn commissions on certain purchases. Its second commerce tool in testing will allow creators to link their merchandise website to both their business and, now, creator profiles, as reported by Digiday.

Who is this monetization tool relevant to and why?

These commercial tools are clearly aimed at individual creators rather than large publishers. However, as influencer marketing becomes an ever-more significant part of brands’ strategy, better affiliate tools will inevitably attract more brands and retailers who reap the rewards of influencers promoting their products. 
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With a smorgasbord of monetization methods in the pipeline, it could be that Instagram manages to prove its worth to a wide range of video makers – from individual creators to media companies. Not only that, it could be that its strategy of first gathering audiences for multiple different video formats under the Facebook ecosystem turns out to be a long game with big returns.

Lead image: Alexander Shatov