Social ads a plenty
Citigroup is being ‘conservative’ on Instagram, valuing the photo-sharing outfit at a mere $35bn, which is around 16% of parent Facebook’s roughly $220bn value. Does Instagram makes loads of cash for the Social Network? Come off it… though there is potential. “While Instagram is still early in monetising its audience and data assets and its financial contribution to [Facebook] is minimal today, we believe that it is quickly gaining monetisation traction and would contribute more than $2bn in high margin revenue at current user and engagement levels if fully monetised,” says Citigroup.
Which, translated, means Instagram would be making a lot of money if it were making a lot of money. Is that what they mean by ‘conservative’ here?
You see, “Instagram is at the early stages of rolling out advertising, but we believe brands have and will find it an effective channel.”
Ah, yet another innovative social media outfit looking to be oh-so disruptive by making money from selling… advertising.
We aren’t the only ones who believe there isn’t enough ad inventory out there to support all these valuations. Who will be first to talk about the emperor lacking adequate outwear?