Feasibility Report

Advertising on Instagram, Valaika 1
Sarah Valaika
6802 Poppy Court
Arvada, CO 80007
November 9, 2018
Ashley Moore
Clark Building C 225
1200 Center Ave.
Fort Collins, CO 80523
SUBJ: Letter of feasibility study on the effects of social media advertising on Instagram.
Dear Ashley Moore,
The following report will discuss the accessibility of social media marketing that Instagram takes
advantage of. The purpose of this report is to acquaint social media users and companies looking
to engage in social media advertising about the feasibility, resources, and relevancy of Instagram
integrating an all social media advertising approach.
Accessible and free technology makes outreach to a universal audience obtainable. Thus, a
company, like Instagram is acknowledged for the use of 21 st century technology and motivates
other companies and gains a more diverse group of followers. Due to the wide marketing
outreach Instagram encounters, users must be open to the change in social media, as well as be
accepting of controversial advertising and the active competitiveness among companies on
Instagram. Instagram users are aware of the need for advertising and exposed to an extreme
number of ads, but Instagram does face issues when privacy and regulations are broken between
users. Instagram may receive backlash if posts are repetitive, litigation between a company
occurs, or users simply complain and report advertisements available.
The following feasibility report explains a precise description of predicaments and benefits that
Instagram advertising will insure. This report will include a table of contents, a list of
illustrations, an executive summary, an organized analysis and description of research criterion,
and lastly a conclusion with recommendations.
Thank you for your time and consideration. I am available at 303-919-3420 or at

sarahvalaika@yahoo.com.
Sincerely,
Sarah Valaika
Feasibility Study Regarding Advertising on Instagram
Sarah Valaika
sarahvalaika@yahoo.com
Communications Department Colorado State University

Table of Contents
List of Figures…………………………………………………………………………………4
Executive Summary……………………………………………………………………………5
Introduction……………………………………………………………………………………7
Historical Background…………………………………………………………………....……9
Criteria of Assessment and Methods of Analysis…………………………………………….10
Cost and Financial Standings……………………………….………………………...11
Instagram User Acceptance……………………………………………………….…..12
Economic Necessity…………………………………………..………………………12
Legal Ramifications…………………………………………………………………..13
Results ………………………………………………………………………………………..13
Research and Cost on Financial Standings……………………………………………14
Research on Instagram User Acceptance…………………………………………….15
Analysis of the Economic Necessity…………………………………………………17
Results regarding Legal Ramifications…………………………………………….....18
Conclusion…………………………………………………………………………………….19
Recommendations……………………………………………………………………………..20
Appendix………………………………………………………………………………………22
References……………………………………………………………………………………..26
List of Figures
Figure 1 Salesforce Example of Advertisement………………………………………….9
Figure 2 Sprout Social Hashtags…………………………………………………………13
Figure 3 How often do you receive promotions on Instagram?.........................................15
Figure 4 Pie chart of User acceptance of social media advertising…………….......…….15

Executive Summary
The purpose of this report is to determine if advertising on Instagram is feasible for both
users, small, and large businesses. The growth in advanced technology has directly influenced
the advertising industry, as well as affected the rise in companies creating Instagram profiles, and
posting on a regular basis to a target audience. Thousands of companies have taken advantage of
this cheap, but accessible technology, while exposing specific ads to users who did not intend on
viewing certain content.
In order to evaluate the feasibility of advertising on Instagram, four distinct criterions
were used. 1.) Cost and financial standings; 2.) Instagram user acceptance; 3.) Economic
Necessity; and 4.) Legal Ramifications. To carefully calculate the cost and financial standings
regarding the amount of money a company spends on an Instagram post, versus the amount of
money Instagram makes from each post, can be estimated at $5-$6 per post and $100 billion in
revenue, with 97% made from directly advertising (Investopedia). The second criteria, is
supported by a student survey conducted across a week, and an Instagram survey conducted over
the course of five years. Over 50% of students and Instagram users agreed that although useful,
advertising on Instagram should not be implemented on a regular basis, but regulated strictly.
The third criterion assessed the economic necessity of Instagram for companies, proving
that there is a need for companies to engage in scheduled posts. Research found proved that 52%
of people felt more confident buying a product if seen on Instagram or Facebook, and after a
successful exchange, 74% of followers are more likely to buy more and or repost or share certain
content (Instagram Power). Lastly, the fourth criterion analyzed the legal ramifications for a
company if they did not follow the terms of Instagram and the litigation that can occur if
inappropriate, offensive, inaccurate, or simply disturbing (Instagram Help Center). Also, if users
who actively evaluate settings and or monitor posts, can avoid 80% of all Instagram
advertisements, but the other 20% is part of Instagram’s “regular posting and part of the social
media experience” (Instagram Business).
The results of this study suggest that although feasible, with more restricted regulations
and privacy options, that advertising on Instagram would be ideal. The low cost, but high
revenue that occurs from Instagram advertising, and the economic influence companies receive
in return, outweigh the current concern for more regulations and or privacy for users.
Recommendations for Instagram included developing a more professional approach to
advertising or social media marketing, to maintain a positive reputation for both users and
companies. Due to Instagram’s net worth currently at $100 billion, the support advertising
provides is essential, yet this number could increase if users felt more in control with the support
of Instagram settings and terms of use. The importance of advertising on Instagram will only
continue to rise, and research provided does conclude that advertising on Instagram is feasible.
Introduction
New technology not only has developed over the course of the last ten years, but also has
trickled into other aspects of everyday use, like in relation to the business and advertising world.
People now take advantage and rely on the accessibility and on command answers that social
media and new technology have to offer. Ideally, social media should focus on the natural
approach, yet businesses take advantage of the accessible wide audience. This can overall leave a
greater impact for an individual, if directly associating a business with social media, as well as a
brand or company solely relying on social media for advertising. (Forbes).
If focusing on the correlation of new technology, the rise in mass media advertising or
marketing it is crucial to understand the benefits and power that a company may feel. According
to the “Social Media Advertising: How to Engage” by Sarah Arayess, “practical advice for
advertisers is to keep record of the relationship between client and company, thus social media is
useful.” This proves that advertising on social media is developing a platform to portray any and
all information to a universal audience that can be either effective or repulsive (Forbes).
Looking at the predicaments that Instagram and other social cites may encounter is
necessary to evaluate. Most companies attempt to be transparent when using certain cites and
should maintain to follow certain policies. Yet, companies who used social media, like Pepsi,
may face serious backlash, like back in 2017 (CNBC). Since this new development and
popularity in social media; using cites to run and market a business is common, and social media
outlets like Instagram created policies and regulations in support of mass media marketing. Thus,
creating and connecting the business directly to potential clients and making outreach more
obtainable, discussed in a personal interview, but also causing issues with privacy and the issues
with one sided news or information displayed. The opportunity to connect and directly portray
the companies mission on Instagram can be good for the success of the business, but overall
questions regarding any personal or private information kept between friends or family is
present.
Discussed in a Business Insurance Quotes article, the best advertisements not only can
grab the public’s attention, but also engage in individual followers as many aim to align values
with the companies who exhibit parallel views or opinions. Yet, “push the envelope to far, and
you are creating a risk that tarnishes your brand” (Business Insurance Quotes). Not only can
advertisements on Instagram enhance or diminish the values of certain individuals, but specific
brands can or will be directly affected, like Pepsi, thus cites like Instagram must regulate and
these advertisements.
Theoretically, if Instagram does pursue the influence of business and advertisement, and
post controversial topics or news, more individuals will ignore or fully engage in social media
for the advertisements and news, not for the social or sharing aspects (CMO Network). The
issues behind social media advertising rise the more controversial or number of ads displayed,
leaving followers with mixed messages. Though the number of people and followers on social
media are significant, individuals following popular companies like Pepsi or McDonalds seek
certain news or want to follow certain brands. CNBC identifies the positive and negative aspects
to social media advertising as “clever but risky” as the rise in individuals on social media partake
in the controversial topics a business will post (CNBC).
The purpose of this report is to educate social media users, on the feasibility regarding
Instagram to us its wide audience as a social platform and engage in mass media advertising.
Historical Background
The first digital advertisement was posted on an AT&T banner was from Wired.com, in
1994. Due to the lack of digital space and non-existent social cites needed to reach a certain
audience. By 2006 JP Morgan Chase attempted to promote credit cards finally on Facebook, but
only managed to reach a limited number of individuals, as they were unaware of Facebook’s
policies and privacy settings (IAS insider).
The up rise in social media advertising roughly started in 2007, after Facebook started to
tell users about the new innovative way to learn and follow a business. By 2010, Twitter
developed the “promoted tweet” telling users that certain posts were developed by specific
companies. This than lead to both Instagram and Snapchat engaging in “popular news” or
“sponsored” tabs allowing users to not only check their follower’s posts, but also now any
popular business (Adweek). In 2013, Pinterest gained more followers due to the number of users
looking for specific deals or companies, which lead to an overall boost in Pinterest’s popularity.
The first recognized issue with advertisements or pop ups on Instagram involved Michael
Kors’ on Instagram in 2013, where a kickoff to a new line in purses and shoes portrayed a
diverse group of models with underlying social and racial stereotypes (Business Insider). This
advertisement not only hurt the upcoming content, but also influenced other competing
companies to reevaluate their new representation on Instagram Since the advertisement, the rise
in social and political issues displayed on Instagram have risen. Brands like Nike, Pepsi, Airbnb,
and Starbucks looked to gain a more value based following on social media, leaving social media
users exposed to one sided or controversial news (Sky News).
In 2018, there are currently 2.56 billion global mobile social media users, and 1 million
new active mobile users added every day (We Are Social). With the number of mobile social
users rising, 71% of consumers who engage and had good social service with a company, are
more likely to follow, post, and recommend the service to others (Ambassadors). The extent of
advertising on social media has increased, and the number of controversial ads continues to rise
as the number of users and companies correlate.
Over the last 20 years, advertising has shifted its
purpose to social media and with rising social,
economic, and political issues influence several
businesses advertising tactics. Figure 1 to the
left, is an example of the type of ads a user might
see, whether they are following Salesforce or not.
Specifically, looking at Instagram, with over 600 million users, Instagram spends $5-$6
per ad, guaranteeing that the advertisement will reach at least a forth of its users (Forbes).
Though relatively cheap, issues arise when Instagram insists on a privacy policy for each user,
but a user may still be exposed to “random” ads. Instagram keeps specific data and statistics on
each type of ad, and where and when it is shared, the behaviors or interests of an individual, and
targeted or related audiences (Forbes).
Instagram reported that 60% of their users discover new products, but 30% reported ads
to be annoying, unveiling inaccurate information, and also not pertain to said individual. Specific
criteria to test the data behind Instagram, and the value of advertising will be discussed below.
Criteria of Assessment and Methods of Analysis
To discuss the feasibility regarding Instagram implementing social media advertising, it
is important to look at specific criteria when determining the positives and negative aspects to
the success of Instagram as a whole. The first criterion used to test the feasibility of mass media
advertising will be exploring the cost and financial ramifications Instagram would face if
allowing any and all companies to exploit advertisements. The second criterion will explore the
overall benefits and ramifications for any and all Instagram user’s privacy and the regulations
surrounding privacy of users and companies. Next, the third criterion of this report is to
determine the economic desirability and the convenience companies find when using Instagram.
Lastly, the fourth criterion will be the consider the legal ramifications if Instagram allows any
advertising at all.
Cost and Financial Standings
Discussed in the introduction, the total cost per Instagram post for a company is
$5-$6 dollar per specific post. In contrast, Instagram is worth about $100 billion, and 97% of
Instagram’s money and success in 2016 comes from advertisements (Investopedia). Compared
to other social media cites, Instagram grew 209% over a year versus Facebook growing 17%.
From a small local business, to a large corporation like Pepsi, paying per post to advertise
context, creates greater revenue for Instagram in the long run. According to Instagram’s business
blog, the benefit to charge companies per post will result in the number of posts per company to
increase, as the amount of people exposed to the advertisement increases.
The method of analysis for this specific cost criterion involved specific research. To
determine the cost per post, research included analyzing Instagram’s released statistics since
2015-2018, as well as comparing statistics to other sites. Sources above involved Instagram’s
financial statements, along with the examining Instagram’s policies page available on their
website, and through deep investigation. The research proved that the cost per post positively
correlates with an increase in money made, from mass communication advertising.
Instagram User Acceptance
The majority of Instagram users accepted that Instagram advertising is successful. Yet, in
order to keep majority optimistic for future social media advertising, the ads must appeal to the
existing company brand, and follow the rules and regulations Instagram has in place, as well as
making sure an advertisement is not too controversial or offensive. Keeping the number of
advertisements to a minimum is important, because when the increase in random ads occurs, the
more annoying and less likely viewers are to read it (Instagram user Survey).
The methods of analysis for this criterion included research from an Instagram user
survey, as well as the statistics of Business Insider, and Disruptive Advertising comments from
regular Instagram users. After surveying 20 students ages 18-21 from Colorado State University,
the research proved that advertising is successful on Instagram, but limiting annoying and
controversial posts.
Economic Necessity
The advertising industry relies on a targeted audience, and the exposure that the ad
encounters. When looking from an economic standpoint, the desire to gain as many clients or
followers, will result in more money made. Yet the negative connotation that circulates social
media advertising, creates tension between social issues and user’s responses online. Television,
radio, billboards, and websites also provide a way for companies to advertise, limiting the
comments and surrounding social media stereotypes (Investopedia).
The methods for analysis for this criterion include the research conducted by the business
specialists, as well as the Instagram advertising restrictions. In recent Digiday story discussions,
an executive shared that the company invested “too quickly” (Digiday Story). This research
supported the economical predicaments Instagram faces when allowing any and all businesses to
post. This resulted in backlash towards Instagram, and the research proved that although
desirable, the economics surrounding the advertising industry have other ways of conveying
information.
Legal Ramifications
Directly looking at Instagram’s policies provided in their settings and terms of use,
research proved that when a company or user creates an account, that any account user or post
directly agrees to the terms (Instagram Help Center). Using the policies provided by Instagram
on their help center and business settings, research proved that the negative effects of Instagram
advertising include certain allegations made by individuals, or disputes due to the companies
breaking agreement with Instagram.
The methods of analysis for this criterion are the research from Instagram help center,
and the terms of use given to users and companies for agreement. Using the data from
Instagram’s settings, support that ramifications occur if users or companies break agreement with
Instagram, leading to the overall miscommunication.

Results
Results for each method of analysis are included in the “Criteria Assessment and
Methods of Analysis” section of the feasibility report below. The criteria’s will be discussed
below and supported by extensive research and outside sources.
Research on Cost and Financial Standings
This report, it is necessary to acknowledge the issues when companies take advantage of
the low-cost advertising on Instagram, but also keep in mind that most of Instagram’s money
comes from advertising, whether that be from small local business, or a large corporation
(Business Insider). An article from Motley Fool, analyses the amount of money Instagram made
from 2017-2018, as it describes “8 million businesses with profiles, from 2017, which is ten
times the amount of businesses users than Twitter” later the article discusses the importance of
calculating and increasing revenue “rapid advertiser growth is accompanied by an acceleration in
its user growth, within as little as six months” (Motley Fool).
Although Instagram is making a substantial amount solely from advertising, making it
accessible for any company raises issues when
companies either take advantage of the wide
variety audience or the informal approach
Instagram portrays. Figure 2 to the right,
outlines the hashtags that are most common
among users, but according to Sprout Social, 7
out of 10 hashtags that users post is branded.
Thus, companies are able to see, access, and post for certain users based of that specific hashtag,
and have the opportunity to make money if people continue to use their branded hashtag (Sprout
Social). As stated in the criteria analysis above, like a hashtag is connected to the company, it is
only $5-$6 for a company to post on Instagram, thus a small or large business uses Instagram
rather than using radio or TV; and makes money from hashtags and posts.
Yet, due to the misleading efforts, a business on Instagram may participate in, users can
be taken advantage of, and or Instagram continue to make money off the businesses. Sprout
Social later discusses that only “30% of users have purchased a product they first saw on
Instagram” and that the advertisements posted, “70% of them do not get seen” thus users do not
respond anymore to advertising on Instagram, then on other social sites. Yet, businesses would
suffer from limitations or lack of advertising, and Instagram would lose a significant amount of
money if limiting the number of companies allowed to post, or if advertising was stopped
completely. Though an important factor, Instagram only increases revenue from a businesses’
post, not from an individual’s post. Thus, when looking at the criteria, the cost and financial
standings would prove that the cost does outweigh the issue s regarding a user’s exposure to
excessive advertisement. The overall success and increase in revenue Instagram receives from a
company posting or using branded hashtags, is crucial for Instagram to remain successful and
compete with other social sites, like Twitter. The cost analysis and the total cost for companies to
post, supports Instagram and without it, Instagram would suffer indefinitely.
Research on Instagram User Acceptance
The results of the eight-question survey, given to 16 students over the week of October
8th through the 12th supported research when attempting to explain the feasibility whether or not
Instagram should implement social media
advertising. To the left, Figure 3 above
states that the number of people that
receive promotions daily is over 80%.
Later, the survey Figure 4 below proves
that 50% of people said Instagram
advertising should be allowed, 31.3% said there should not be any social media advertising, and
the last 18.8%. When looking closer at the survey results, a Word Stream Blog discusses that
even with 800 active users, over a little under 50% of those users did not agree with Instagram
advertising (Word Stream).
Due to the survey results, it can be
concluded that over half of students surveyed
did not support Instagram advertising, this
correlates to the survey results of Word Stream
where half of users also agreed that Instagram
should not implement advertising.
Then, the survey asked why users
follow certain brands or companies on Instagram. The data showed that most users follow a
certain brand, for example, Lululemon, only follow if that specific company posts to a certain
aesthetic, has a good reputation, posts coupons or new arrivals, and does not overwhelm
followers with annoying content or controversial ads. Although very specific criteria, the survey
proved that the users accept the advertising Instagram has to offer, but ultimately does not solely
use Instagram to buy products, or even shop for future products.

Thus, the survey than asked users to consider the pros and cons of social media
advertising on Instagram. Eight of the survey results agreed that “yes, it does work, but it does
get obnoxious, annoying and can cause conflict” (Survey). Users did agree it is helpful for a
company, and with the accessible technology, companies should use what is available, but the
amount and or number or advertisements when “trying to post for friends and family” is
confusing and or not the main purpose for Instagram.
Now, connecting the past survey results, as well as comparing current survey results with
other surveys conducted, it can be proven that over 50% of Instagram users and regular followers
of popular companies agree that advertising on Instagram is not feasible. Using the survey to
analyze the acceptance of Instagram advertising contributed highly to the social desirability of
the report, thus very important to the analysis of the methods in this report.
Analysis of the Economic Necessity
Companies, like stated in the introduction, Pepsi, rely on reaching a wide universal
audience, thus social media is an accessible and cheap tool for companies to use. Yet, Pepsi
faced backlash in 2017 for the controversial advertisement surrounding police brutality (Ad
Week). Other companies like PuraVida or Redbull, take advantage of users, specifically creating
content for people within a certain age group, location, or based off a recent post or search made
by a user (Business Insider).
This creates somewhat of an economic dilemma, although companies are required to
advertise to be successful, the number of posts and rules broken develop issues for both the
company and the Instagram user. Yet, research conducted raises a question regarding the
absolute need for Instagram advertising clearly for all small and large companies.
According to research conducted by the University of Australia Wollongong, “it is a very
effective technique in tracking consumer behavior, and helps identify new marketing strategies”
(University of Australia Wollongong). Thus, a company focuses on “finding the right target adds
power to social media, if planned, creates an important tool for communication” even though
Instagram users might not sign up or follow, companies develop infographics to appeal to the
audience, so some backlash is to be expected. Yet, according to the article “Instagram Power:
Build Your Brand” by Jason Miles, 52% of people feel more confident buying a product if seen
on Instagram or Facebook, and after a successful exchange, 74% of followers are more likely to
buy more and or repost or share certain content (Instagram Power).
Now, accepting the research above, the need for Instagram advertising is crucial to any
company looking to attract new followers, develop a more diverse following, and engage in a
cheap and effective way of advertising (University of Australia Wollongong). With strong and
articulated research, it can be proven that there is a need for Instagram advertising, which
outweighs the predicaments with excessive or targeted posting. Consequently, the economic
criteria must be recognized for the support in Instagram advertising, in regard to the success and
reliability of a company.
Results regarding Legal Ramifications
Accepting the legal ramifications Instagram faces when targeting an explicit audience is
crucial to understand the evidence provided by regular Instagram users and advertising
specialists. Specialists from Lexology, deliberate on the idea that a follower’s privacy is affected,
as well as a miscommunication between Instagram’s business regulations and the companies
consistent posting or social media influence (Lexology). Mannatt Phelps states that people are
“unaware of the complex legal overlay of the digital world and the potential significant financial
repercussions of their companies’” and that “failure to understand and follow these requirements
can potentially lead to expensive litigation or government enforcement actions and negative
publicity that can harm a brand” (Lexology).
This creates issues for both the company and the user. A company, according to
Instagram’s business settings, can face litigation if a company does not follow certain
regulations: posts that are inappropriate, offensive, inaccurate, or simply disturbing (Instagram
Help Center). A company must agree to terms, as well as create a page through Instagram
Business to maintain in “good standing” as well as receive Instagram promoting.
The user may agree to set privacy settings to only see follower’s posts or simply block
specific companies is advertising is not applicable. Yet, pop ups that say “sponsored” are
regulated by Instagram Business, and cannot be avoided by users, only reported on an individual
level. Users who actively evaluate settings and or monitor posts, are able to avoid 80% of all
Instagram advertisements, but the other 20% is part of Instagram’s “regular posting and part of
the social media experience” (Instagram Business).
Overall, considering the legal issues for both a business and an individual user, it is an
important and or effective criteria when determining the feasibility of Instagram advertising.
Research and Instagram Business Settings support the idea for a regulated and or appropriate
level or advertising, if the content follows regulations, thus this criterion can is moderately
effective.
Conclusion
This report was advised to consider the feasibility of Instagram advertising. The
importance of advertising for any small or large business, relies on the audience and reputation
of popular brands reported by Instagram users. Thus, assessed by the four criterions above, it is
feasible for Instagram to engage in regular advertising. Regarding the financial and economic
criteria, Instagram’s rise in users, as well as ads, leads to a greater success for the company.
Without the influence of new technology Instagram has to offer, advertising seems affordable
and a necessity for any and all companies.
Throughout research, predicaments surfaced when users and specific legal ramifications
became prominent. When companies like Michael Kors, and Pepsi engaged in controversial
social media advertising, resistance from users started, as well as litigation from Instagram
occurred. This, although a setback, did not affect the number of users actively using or attending
brands on Instagram; but overall users do not agree with the amount of posts, but agree that it is
necessary for companies.
Recommendations
With more exposure to advertising, Instagram should invest in portraying more privacy
and information settings for users, as well as continue to analysis and approve certain companies
posts and regular profiles. Yet to totally eliminate or dismiss Instagram advertising seems
impossible and or not feasible. It is recommended that Instagram expose issues with posts or
companies, as well as allowing users to access more individual settings within social media.
Other sites, like LinkedIn, engage in a more professional approach to advertising or
social media marketing, to maintain a positive reputation for both users and companies. With
Instagram’s substantial success, growing users, and rise in business influence, considering
adding a more professional or regulated approach to advertising could be beneficial. That

conclusion was accepted after carefully evaluating the feasibility of this project with the four
criterions above (cost and financial standing, user acceptance, economic necessity, and legal
ramifications).
Appendix
Appendix A
Survey Questions used for research
1. Do you follow your favorite brands on Instagram?
2. How often do you receive promotions on Instagram?
3. If your favorite brand posted a controversial ad, would you continue to follow them?
4. What makes you want to follow a company or brand on Instagram?
5. Do you think companies should be allowed to advertise on Instagram? Why or why not?
6. Should controversial ad exist?
7. Should social media advertising exist?
8. What are the pros and cons of social media advertising?
Appendix B
Question 2
Question 4
Question 5
Appendix C
Chart with results of favorite social media cite.
Image taken from https://blog.hootsuite.com/instagram-statistics/
Appendix D
Rate of active users since 2013
Illustration taken from https://www.statista.com/statistics/253577/number-of-monthly-active-
instagram-users/
References
“Advertising on Instagram | Instagram Business.” Instagram for Business, 2018,
business.instagram.com/advertising/
Brody, Jesse M., and Suemyra A. Shah. “Hashtags and Ads: Top 10 Legal Considerations for
Brands Involved in Digital and Social Media Advertising.” The Impact of Fake News:
Economy - Part 2 - Lexology, Lexology, 14 Oct. 2014,
www.lexology.com/library/detail.aspx?g=61683b49-1be2-450c-bdff-2e9970dba1f1.
Burke, Keelin. “Instagram for Business: Pros and Cons of Instagram's Changing Platform.” Cypress
North, 26 July 2018, cypressnorth.com/social-media-advertising/instagram-for-business/.
“Code of Ethics.” NEA, www.nea.org/home/30442.htm.
“Instagram Help Center.” Terms of Use | Instagram Help Center, 2018,
help.instagram.com/581066165581870?helpref=faq_content.
Monllos, Kristina, “How Pepsi Got It So Wrong: Unpacking One of the Most Reviled Ads in Recent
Memory.” – Adweek, Adweek, 5 Apr. 2017, www.adweek.com/brand-marketing/how-pepsi-got-
it-so-wrong-unpacking-one-of-the-most-reviled-ads-in-recent-memory/.
Machicao, Carlos. “Five Reasons B2B Companies Should Not Ignore Social Media.” Forbes, Forbes
Magazine, 19 Mar. 2018, www.forbes.com/sites/forbesagencycouncil/2018/03/19/five-reasons-
b2b-companies-should-not-ignore-social-media/#33fc6ea7f8cf.
Moses, Lucia, et al. “Digital Content, Digital Advertising, Digital Marketing.” Digiday, Digiday, 2018,
digiday.com/.
Newman, Daniel. “Many Brands Still Have No Idea How To Use Social Media.” Forbes, Forbes
Magazine, 15 Dec. 2015, www.forbes.com/sites/danielnewman/2015/12/15/many-brands-still-
have-no-idea-how-to-use-social-media/#627e211f22f3.
Simon, Ellen. “How Instagram Makes Money.” Investopedia, Investopedia, 1 Nov. 2018,
www.investopedia.com/articles/personal-finance/030915/how-instagram-makes-money.asp.
Simon, Ellen. “How Instagram Makes Money.” Investopedia, Investopedia, 1 Nov. 2018,
www.investopedia.com/articles/personal-finance/030915/how-instagram-makes-money.asp.
“Walmart Ethics & Integrity.” Walmart, corporate.walmart.com/our-story/ethics-integrity.

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Advertising on Instagram, Valaika 1

Dear Ashley Moore,

Thank you for your time and consideration. I am available at 303-919-3420 or at

Feasibility Study Regarding Advertising on Instagram

Communications Department Colorado State University

Criteria of Assessment and Methods of Analysis…………………………………………….10

Cost and Financial Standings……………………………….………………………...11

Instagram User Acceptance……………………………………………………….…..12

Research and Cost on Financial Standings……………………………………………14

Research on Instagram User Acceptance…………………………………………….15

Analysis of the Economic Necessity…………………………………………………17

Results regarding Legal Ramifications…………………………………………….....18

Figure 1 Salesforce Example of Advertisement………………………………………….9

Figure 2 Sprout Social Hashtags…………………………………………………………13

Figure 3 How often do you receive promotions on Instagram?.........................................15

Figure 4 Pie chart of User acceptance of social media advertising…………….......…….15

viewing certain content.

In order to evaluate the feasibility of advertising on Instagram, four distinct criterions

media experience” (Instagram Business).

Recommendations for Instagram included developing a more professional approach to

brand or company solely relying on social media for advertising. (Forbes).

in the controversial topics a business will post (CNBC).

policies and privacy settings (IAS insider).

users exposed to one sided or controversial news (Sky News).

as the number of users and companies correlate.

Over the last 20 years, advertising has shifted its

purpose to social media and with rising social,

economic, and political issues influence several

businesses advertising tactics. Figure 1 to the

left, is an example of the type of ads a user might

see, whether they are following Salesforce or not.

targeted or related audiences (Forbes).

Criteria of Assessment and Methods of Analysis

To discuss the feasibility regarding Instagram implementing social media advertising, it

Cost and Financial Standings

increase, as the amount of people exposed to the advertisement increases.

correlates with an increase in money made, from mass communication advertising.

Instagram User Acceptance

comments and surrounding social media stereotypes (Investopedia).

breaking agreement with Instagram.

Instagram, leading to the overall miscommunication.

below and supported by extensive research and outside sources.

Research on Cost and Financial Standings

calculating and increasing revenue “rapid advertiser growth is accompanied by an acceleration in

its user growth, within as little as six months” (Motley Fool).

Although Instagram is making a substantial amount solely from advertising, making it

accessible for any company raises issues when

companies either take advantage of the wide

variety audience or the informal approach

Instagram portrays. Figure 2 to the right,

outlines the hashtags that are most common

among users, but according to Sprout Social, 7

out of 10 hashtags that users post is branded.

Research on Instagram User Acceptance

Instagram should implement social media

advertising. To the left, Figure 3 above

states that the number of people that

receive promotions daily is over 80%.

Later, the survey Figure 4 below proves

that 50% of people said Instagram

advertising (Word Stream).

Due to the survey results, it can be

concluded that over half of students surveyed