Instagram Product Managers Attempt To Do The Impossible

by drjim on April 28, 2014

Are Instagram's Product Managers tinkering with disaster?

Are Instagram’s Product Managers tinkering with disaster?
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Welcome to the crazy world of social media. You know, the market segment where one day there’s nothing and then the next day there’s a brand new company that is worth billions. The story of Instagram is just like this. This photo sharing social media hub came out of nowhere and ended up being bought by Facebook for US$1 billion. Now comes the hard part: how will Instagram’s product managers change things so that Instagram can start to make money…?

Instagram’s World Today

Instagram is an “app” that runs on both Apple and Android mobile devices. The company has identified its mission statement as being “…to capture and share the world’s moments…” It does this by allowing its users to snap photos with their cell phone cameras and then share them online.

When Facebook purchased Instagram for US$1 billion, they did it for one single purpose: to help Facebook expand into the mobile market segment. Facebook was struggling to capture a piece of this ever growing market.

Instagram has an active user base of roughly 150M users who all enjoy the app’s cool, clean design that allows them to easily share photos. Any change to this could quickly cause users to leave and go find another app to use for their photo sharing needs – remember what happened to MySpace?

What Instagram’s Product Managers Can Do

Instagram’s product managers have a real challenge in front of them. The key to their success is to rethink their product development definition and find a way to add advertising to their app in a way that does not anger or upset their current base of users. The first step that the product managers have taken is to catalog all of the brand marketers who are currently using Instagram for free. This is a good effort and they can probably add it to their product manager resume.

The product managers are now sitting down with those companies to see how they can make advertising on Instagram even more valuable to them. The challenge that they face is that if the ads on the app become too “in your face”, then they risk driving their base of customers away.

What is still missing from the product manager’s bag of tricks are the quantitative tools that they are going to need to make selling ad space successful. These tools will allow advertisers to determine the reach and the efficacy of their Instagram advertising efforts. The long-term goal has to be to keep things simple for the end users. If they make things too complicated, then their product will not be successful.

What All Of This Means For You

There is no doubt about it: Instagram is a very popular social media service. However, they have a huge problem: right now they don’t have any way to make money. Facebook didn’t spend $1 billion dollars to buy Instagram just because they liked the way that it looked. They want it to make money. Changes need to happen.

Instagram’s product managers have a delicate balance that they need to strike that was never discussed in their product manager job description. On one hand they have to keep Instagram’s clean design that has attracted 150M users. On the other, they need to start to add ads so that the company can make money. One of the biggest challenges is that many companies are using Instagram for free to promote their products.

The goal of the Instagram product managers has to be to keep things simple. Avoiding overloading their users with splashy ads while still providing the “eyeballs” that their advertisers covet will be the key to Instagram’s success. It can be done, it’s just going to take some good product management to pull it off!

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™

Question For You: Do you think that Instagram should just roll their new ads out to everyone or should they do a beta test?

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What We’ll Be Talking About Next Time

Facebook, Twitter, Pinterest, LinkedIn, the list just keeps getting longer. Social media has certainly arrived. As product managers we all realize that these new tools offer us a fantastic way to get in touch with our potential customers and they need to be a part of our product development definition. However, it’s going to take a lot of effort and it’s going to cost a lot of money. Is it all going to be worth it?

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