Instagram is
the New Storefront

Effective Strategies for Organic Growth and Battling the Rising Cost of Ads on Instagram this Shopping Season.

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Introduction

Window shopping used to take place in malls and high streets, but now, increasingly, product discovery — and purchase decisions — happen online, especially on Instagram.

And with planning for the busiest retail period of the year getting started, we wanted to dive a little beyond best practices to learn how successful brands and marketers are taking on two of the biggest challenges on Instagram this shopping season:

  • Standing out organically in crowded feeds
  • Battling the rising cost of ads

For this report we spoke with marketers from Stance, tentree, Blenders Eyewear, The Hundreds, and Shoelace. Keep reading below to see how they’re approaching Instagram during the 2019 shopping season.

500M
daily stories users on Instagram
1B+
monthly active users on Instagram
45%
of Instagrammers say the platform is influential for shopping over the holidays

The value of organic content

Instagram is essential for retail brands that want be culturally relevant and build strong communities of customers. Here’s how direct-to-consumer marketer Nik Sharma sees it:

“For consumers who rely heavily on Instagram for their news, info, and updates, Instagram is the first place they'll go to look up new brands,” says Sharma. “If you don't have a proper profile, you can't be taken seriously in today's market. I believe every brand should have its own Instagram presence, whether or not their only goal is using the platform to acquire customers.”

For consumers who rely heavily on Instagram for their news, info, and updates, Instagram is the first place they'll go to look up new brands.

But with algorithm tweaks and reach becoming somewhat unpredictable, how are brands navigating organic posting on Instagram this shopping season? And why does organic content still matter?

Strategy #1: Create a two-way relationship with customers

There might not be as much buzz around organic posting due to the explosion of advertising on Instagram, but one thing is clear: Organic content plays a key role in helping to build strong communities and brand equity.

For Noelle Bates, SVP of Marketing & Communications at Stance, organic content is a cornerstone of marketing strategy, and it plays a key role in helping the brand to build strong relationships with customers. Organic posting is the foundation of our Instagram strategy and our marketing strategy overall, says Bates. “We’re lucky in that we have ‘grown up’ with Instagram and began building a community long before there was any such thing as paid content, so connecting with people was, and still is, the foundation of our marketing. And that really happens through our organic posts.”

Stance has grown its audience to over 1.4M on Instagram, with a further 500K followers across other accounts including Stance Basketball, Running and Baseball.
Even though our retail presence is growing, social is predominantly the only place where people can have direct back and forth with our brand on an ongoing basis. Interacting with our customers via social is really important to us, whether that means acknowledging them, answering DMs, or engaging with their content, it's important they know we are listening to them and we appreciate them. No good long-term relationship is one-sided.

Noelle Bates, SVP of Marketing & Communications, Stance

Strategy #2: Use Stories to drive awareness of products, sales and promotions

500 million people use Instagram Stories daily, and people enjoy using Stories as a way to connect with brands and discover new products.

In a Facebook study:

  • 62% of respondents said they have become more interested in a brand or product after seeing it in Stories
  • 69% of respondents said that brands using Stories is a great way for people to get to know new products or services

“Instagram Stories play a huge role in many of our campaigns,” says Grace McLaughlin, Marketing Manager at Blenders Eyewear. “For promotions, we’re pumping stories the entire day to make sure we’re in front of everyone and all viewers are aware of the latest Blendz News. Not only do these organic Stories stoke out our followers, they consistently bump up traffic to our site and increase sales.”

Not only do these organic Stories stoke out our followers, they consistently bump up traffic to our site and increase sales.
For products, we leverage stories to give people the ability to sign up for first access for upcoming releases. The goal is to hype them up for whatever we have coming out while simultaneously growing our email list.

Grace McLaughlin, Marketing Manager, Blenders Eyewear

Strategy #3: Showcase your catalog

The visual nature of Instagram makes it the perfect place to showcase products during shopping season. Scrolling up and down the Instagram feed has become second nature for shoppers.

For Los Angeles-based streetwear brand The Hundreds, organic Instagram posts help to keep its products top-of-mind. “In between seasons or big releases is our slow period,” says Sandy Mosqueda, Editorial Assistant at The Hundreds. “Organic posts help us remind the people of existing pieces in the collection.”

The Hundreds also sees the bio link as a key part of its Instagram profile and uses Buffer’s Shop Grid feature to help its audience buy products featured on its profile: “Because the Shop Grid looks identical to our Instagram feed, it allows the user to feel more comfortable when shopping.”

Shop Grid enables The Hundreds to link Instagram to its online store.

User-generated content is another key strategy that The Hundreds uses to showcase its products and drive traffic to its store: "Fans send us photos of them wearing our stuff in hopes that we’ll repost,” says Mosqueda. “Say if it’s a recent piece, we can use that as an opportunity to [use a] product tag in hopes that they click on the tag, and the tag directs them to purchase."

Instagram can drive offline sales too

The eCommerce industry continues to grow, but in 2018 the $3 trillion generated from online sales made up just 15% of total retail sales. So it’s important to also think about how building your brand and showcasing products online can drive offline sales.

By using its Instagram page as a “lookbook” or “storefront” to showcase products, tentree has been able to create demand for its featured products in store:

We have always found there to be a direct correlation on what people see on tentree’s Instagram to what is purchased online and in stores. We have heard on countless occasions of people going to a store that sells tentree with a screenshot of an item found from our Instagram.

Victoria Harding, Performance Marketing Manager, tentree

Strategy #4: Take your audience behind-the-scenes

Consumers seek connection with brands, and one of the best ways to start building relationships is to use Instagram as a way to bridge the gap between your business and consumers.

For Blenders Eyewear, this means creating content that brings consumers into their office and shares engaging narratives about the people that run the company and athletes that advocate for the brand: “We leverage organic as a way to tell our brand story,” says McLaughlin. “We balance highlighting product with spotlighting our athletes, giving people an inside look at HQ and providing content that pushes others to live life in forward motion.”

We balance highlighting product with spotlighting our athletes, giving people an inside look at HQ and providing content that pushes others to live life in forward motion.

Not only does this approach help to create lasting consumer relationships for Blenders, it also helps to encourage word-of-mouth sharing from brand advocates. “Humanizing our brand allows us to build a loyal community that is willing to positively talk about their experience with us and our product,” says McLaughlin.Free marketing is the best type of marketing.”

At a time when brands are all competing for the real estate in social feeds, it's important to create a reason that people follow along closely.

NIK SHARMA, DTC Marketer

Instagrammers have become accustomed to shopping on the platform and more than 130 million Instagram users tap to reveal product tags in posts each month.

Battling the rising cost of ads

Instagram ads opened up to everyone in late 2015, and now over 2 million businesses are advertising on the platform.

“Pretty much every brand is doing paid social today,” says Reza Khadjavi, co-founder of Shoelace. “The heavy competition for a limited number of ad spots has driven up the cost of acquisition radically over the past few years.”

The heavy competition for a limited number of ad spots has driven up the cost of acquisition radically over the past few years.

With rising ad spend front of mind for many brands during the holiday shopping season, what can marketers do to ensure they get the very most from their advertising dollars?

Strategy #1: Take a brand-first approach to advertising

When you think about your advertising budget, it’s easy to focus on the bottom-of-the-funnel and direct conversions. But in the long run, it might be better to focus on a brand-first approach.

“Think companies like Apple, Nike, and Lululemon. Their audiences live and breath their products, and are the first in line when a new product is released,” says Khadjavi. “If these organizations took a sales-first approach rather than building genuine connections with their audience, this surreal amount of brand spectacle would not exist."

When every other retailer is pushing sales and discounts, it can be tempting to join the pack and focus on cashing out quick sales to audiences that are craving deals. But this could have a negative impact on your brand, warns McLaughlin: "During the holiday season, it’s easy to lose your brand while strategizing aggressive marketing techniques. While this may lead to the obvious short-term positives, it can also lead to expensive one-time purchasers and potentially manipulate your loyal customer base."

During the holiday season, it’s easy to lose your brand while strategizing aggressive marketing techniques. While this may lead to the obvious short-term positives, it can also lead to expensive one-time purchasers and potentially manipulate your loyal customer base.

This viewpoint is shared by Stance, too. “We are not interested in one-off customers,” says Bates. “We want people to engage with our brand for the long-term, which goes well beyond a one-and-done purchase.”

“Don’t rely strictly on discounts and sales to capture your audience during the holiday season," says Khadjavi. "Instead, ask yourself how else you can convey value through your advertising experiences. This means interlacing your conversion-focused ads with content and media that will stand out to audiences when they are trying to figure out what their loved ones will appreciate the most.”

When a brand focuses too much on conversions, they risk alienating their audiences and scaring away potential lifetime customers.

REZA KHADJAVI, CEO, Shoelace

Strategy #2: Using organic insights to fuel paid strategy

Posting organically generates a wealth of data and analytics that marketers can use to fuel their growth strategies and paid acquisition plans.

tentree is always keeping an eye on its data to spot opportunities as they arise. “We ensure to pay close attention to strong-performing images and Stories on our Instagram page,” says Harding. “If we see a post driving significant engagement or traffic we will look to test it on Facebook Ads Manager.”

tentree often showcases its products on Instagram and promotes
strong-performing posts using ads.

Stance also uses its organic performance as a way to decide what content should be promoted. “If it works really well on organic it will work on paid,” says Bates. “Although we don't - and wouldn't - purposefully architect our organic feed as a proving ground for what we do on the paid side, we can still utilize the insights to help us select what content should be promoted.”

We watch the analytics on a piece of content for a few hours after we post, then apply paid dollars to promoting the very best content. Because we post so much organic content we have a much bigger pool to glean insights from in terms of what's resonating with people and can use those insights to help create better acquisition creative.

Noelle Bates, SVP Marketing & Communications, Stance

Strategy #3: Pay close attention to frequency and sequencing

When you’re running advertising campaigns for shopping season, it’s important think about how frequently your target audience will see each of your ads.

“In short, frequency is an estimation provided by Facebook as to how often the average visitor sees a particular ad,” explains Khadjavi. And at Shoelace, the team recommends that frequency should be no higher than 1.5 times per day to avoid upsetting the consumer.

Frequency should be no higher than 1.5 times per day to avoid upsetting the consumer.

In order to create engaging ad experiences, Khadjavi and Shoelace also focus on a process they call “day sequencing.” In short, this means breaking down the ad retargeting experience to show some of your audience particular ads in the initial period of time after they leave your site, and then different ads the period afterwards.

Day sequencing has enabled Rhone to increase conversion rates by 12% and decrease cost-per-action by 19.3%.

There are a couple of key benefits to day sequencing:

  1. It allows merchants to leverage a mix of ads with unique objectives to build a retargeting experience that tells the story, while driving sales.
  2. You can expose your audience to more value propositions with your brand and products than you would be able to do with a single ad.
We might show a user a dynamic product ad in the first three days after leaving the site to drive conversions, and then - if they have not converted - show them a video ad for the next three days to build brand awareness.

Reza Khadjavi, CEO, Shoelace

Strategy #4: Promote products across channels

Instagram is a key channel for many retails brands, but it’s not the only channel. For both paid and organic campaigns, it’s important to think about how Instagram fits with your overall strategy.

In order to maximize sales and revenue during shopping season, Blenders takes lessons from Instagram and applies them to other channels. “Paid is just one step in the funnel,” says McLaughlin. “If a product is crushing it on paid, we highlight said product in our organic social posts, email campaigns, as well as our site.”

If a product is crushing it on paid, we highlight said product in our organic social posts, email campaigns, as well as our site.

tentree uses a similar approach by syncing its Instagram Stories content with email marketing: “We generally create 1-2 product-focused Instagram Stories per week, in tandem with our email marketing calendar,” says Lindsay Derer, tentree's Digital Community Lead.  

When it comes to preparing your marketing for the holidays, it's best to start early — Facebook found that consumers begin planning for the holidays as early as November 1st.

Executive summary

As Instagram continues to grow, its influence on the world of eCommerce increases too.

Since the early days of Instagram, brands have used it as a digital storefront to showcase their products and brand. But now, Instagram is becoming a key source of traffic and sales for retailers.

Every retail brand is going to want a slice of the action this shopping season, so there will be plenty of competition across the Instagram feed and ads. "To be heard, it is critical for a brand to create an advertising experience that captures a bond with the customer," says Reza Khadjavi.

Don't rely exclusively on sales and discounts, instead focus on what differentiates your brand from the competition. "So you have a discount on this product - that still does not tell your audience why they should buy from you rather than the other hundred brands that are trying to sell to them," explains Khadjavi.

Approaching shopping season with a brand-first mindset will help you to win lifetime customers, rather than one-and-done purchasers.  

Approaching shopping season with a brand-first mindset will help you to win lifetime customers, rather than one-and-done purchasers.  

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