Facebook is about to turn on the money jets for Instagram

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Big money ahead for Instagram Rachel Murray/Getty Images for Coachella

Three years after Facebook shelled out $US1 billion to buy Instagram, the company is ready to turn on the money jets.

Over the next few months, all of Facebook’s ad targeting tools will be opened up to Instagram advertisers, Facebook’s VP of global marketing, Carolyn Everson, explained at the Cannes Lions International Festival of Creativity.

Translation: For advertisers, buying Instagram ads tailored for specific users will become much easier. For users, ads on Instagram will be more targeted to their interests.

“It’s not like you can just check a box if you’re buying things on Facebook and it will also work on Instagram. But we’re working toward that,” Everson said, according to Bloomberg.

Right now, Instagram advertisers can only target people based on their gender, age, and country. But once they can integrate information from people’s Facebook profile details, ads will be much more relevant and, presumably, effective. Meaning that Facebook can charge much more for then.

Integrating Facebook’s data “should deliver a better return on investment because the marketer is actually reaching someone who is interested,” Everson continued.

This isn’t the first we’ve heard of the upcoming change, but it is the first time we’ve seen an exec speak publically about it. It follows a host of other ad updates, like earlier this year when Instagram started allowing brands to multiple photos per ads and include clickable links that can open an in-app browser for shopping. The app currently has over 300 mill lion month users and 200 million daily active users.

In a recent note, analysts from Canaccord Genuity estimated that Instagram would generate $US1.2 billion in revenue next year and nearly $US4 billion by 2018. Not bad, for a $US1 billion investment. Analysts at Raymond James had a slightly more conservative, but still hefty estimates of ~$US500 million in 2015, $US1.1 billion in 2016, and $US2 billion in 2017.

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