Meta is launching two new ads on Instagram that are claimed to unlock further opportunities for advertising as the company faces softening demand for its ads. The social network announced that it is launching a test with ads in the search results that would have people looking for businesses, products, or content. People will begin scrolling through feeds when tapping into posts through search results where the ads are likely to appear.
Meta will roll out ads in search results worldwide in the coming months after the initial testing phase. The launch is going to be an unwelcome addition to the app from a consumer standpoint, as it brings ads to yet another part of the social network.
After rolling out to millions of users worldwide, related ads based on a search will be displayed for those users. For example, if you type "Skin Care," relevant ads are shown on the results feed. One will be able to distinguish an ad from any other post through the presence of the word "Sponsored" under the account's name.
The other advertisement Instagram is introducing is known as Reminder Ads, whose purpose is to make announcing, reminding, and making people aware of future launches or events that may excite them easier for the businesses. The concept is to help advertisers build on awareness and anticipation of things that are going to hit the market soon. Through Reminder Ads, users opt into reminders and receive up to three notifications from Instagram. Users will get one day ahead of an event time or launch, 15 minutes before the event/launch, and at event/launch time. These Reminder Ads will be distributed to all advertisers as part of the in-feed package.
These new tools build on the company's capabilities to attract revenue at the time when Meta has seen plummeting ad sales. Meta revealed last month its Q4 2022 earning results, in which the company's ad revenue fell to $31.2 billion from $32.6 billion in the same quarter last year. Meta CFO Susan Li had indicated at the time that the company's Q4 revenue remained under pressure from weak advertising demand. Li added that this was because of "the uncertain and volatile macroeconomic landscape.".
After reporting its first ever quarterly revenue fall in Q2 2022 after the ad sales slumped, Meta increased ad load on Instagram by launching two more ad slots. Meta introduced a new Facebook Reels ad format and began to enable advertisers to serve ads on Explore home page as well as profile feeds.
Meta was not an exception to the pack, as Snap CEO Evan Spiegel told analysts last month that advertising demand hasn't improved. According to Spiegel, this was because advertisers were managing their budgets amid economic uncertainty.