Mark Zuckerberg might be a lot happier about spending $US1 billion on Instagram than Marissa Mayer is about shelling out the big bucks for Tumblr.
According to research by the think-tank L2 Intelligence, Instagram is the best media acquisition of the last five years and Tumblr is the worst.
Since Facebook bought Instagram for $US1 billion in April 2012 and Yahoo purchased Tumblr for $US1.1 billion in May 2013, the two social networks have seen extremely different rates of growth as well as interest and adoption rates from brands and advertisers.
“Prestige brands have abandoned Tumblr, and the adoption rate has declined,” the report says. “Instagram’s 2014 revenues are forecast at $US250 million-$400 million, while mention of Tumblr was noticeably absent from parent company Yahoo’s recent earnings announcement.”
90-three per cent of prestige brands — basically, the brands that companies want as advertisers — are on Instagram, and, since December 2013, those brands have increased their engagement on Instagram by 1.53%. At the same time, Instagram also had the highest year-over-year increase in unique visitors than any of the other top-10 mobile apps.
If you compare the growth of active usage between Instagram and Tumblr over the second half of 2013, Instagram’s usage increased by 23%, whereas Tumblr’s only increased by 6%.
Check out L2’s chart of different social networks’ brand engagement in relation to their size:
Instagram has had amazing year-over-year growth: