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Instagram CEO Kevin Systrom on winning the Stories war

Instagram beat Snapchat at its own game — now what?

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Kevin Systrom, Instagram CEO
Kevin Systrom, CEO of Instagram at Facebook’s headquarters in Menlo Park, CA
Photo by Vjeran Pavic / The Verge

Two years ago today, Instagram introduced its clone of Snapchat Stories: a feed of photos and videos that disappear 24 hours after they are posted. The average Instagram user was posting fewer times per month than they once did, and Snapchat was ascendant. Cut to today, and the situation has reversed. Instagram Stories now has 400 million users per month — 100 million more people than even used Instagram in 2016. Snapchat’s growth quickly slowed to a crawl, and the company’s long-term hopes now rest largely on whether it can successfully transform itself into a hardware company.

For Kevin Systrom, Instagram’s co-founder and CEO, the second birthday of the great Stories heist comes as a vindication. “It really goes against the idea that companies can’t adopt these things and make them their own,” Systrom said this week in a phone interview. “My position had always been that this is a format, and I still believe that. The question is going to be, do we have a unique vision of our own? A lot of what you’ve seen over the last year or so backs that up.”

Indeed, where Instagram’s take on Stories initially looked almost identical to Snapchat’s, the company has taken steps to make it more distinctive. The past 24 months have seen Instagram add a host of new creative tools for self-expression, including the Superzoom, the polling sticker, the emoji slider, the questions sticker, and music clips. It formed partnerships with Spotify and GoPro, allowing people to share what they were listening to or their action photography directly to Stories.


Perhaps most importantly, the introduction of Stories seemed to galvanize a new spirit of experimentation at Instagram, which had generally been loath to tamper with its original photos-plus-filters format. Instagram arguably changed more in the past two years than it did in the previous five. The success of Stories drew hundreds of millions of new users and gave birth to a family of new apps, including the IGTV video app and a standalone messaging app that is now in testing.

It also ramped up significant pressure on Instagram to succeed, both internally and externally. Facebook, which acquired Instagram in 2012, has had a hellish two years. Revelations that Russia-linked groups used Facebook to interfere in the 2016 US presidential election triggered a global reckoning over the negative effects of social media. The “Time Well Spent” movement put pressure on the company to prove that social apps benefit their users. More recently, the Cambridge Analytica data privacy scandal and the controversy over Facebook’s handling of misinformation have kept it on the defensive.

And all that happened before last week’s earnings report, in which Facebook revealed that its growth prospects around the world were dimming. The next day, Facebook’s stock lost $120 billion in value, the largest one-day drop in the history of the stock market.

The decline revealed the extent to which investors have come to place their future hopes in Instagram, rather than in Facebook’s still popular and wildly profitable flagship app. The market panicked, in part, because Facebook disclosed that ads on Instagram Stories were not generating as much revenue as ads in the main Facebook and Instagram feeds.

“Every brand-new format never monetizes as well as established formats.”

Systrom attributes this gap to the developing nature of the format. “Every brand-new format never monetizes as well as established formats,” he says. “That was true for online advertising for a long time. That was true of mobile advertising. There’s a certain maturity that happens over time, both with advertisers learning how to utilize the format, and we as a company are learning how to optimize the format so it delivers the most value to advertisers.”

Facebook’s interest in perfecting the ads in Stories goes beyond Instagram. After Instagram’s success with the format, its parent brought similar features to Facebook, Messenger, and WhatsApp, with varying degrees of success. WhatsApp’s clone, called Status, has the most users of any such product globally, and it plans to introduce ads there next year. The Facebook and Messenger versions have performed badly and worse, respectively.

Systrom says that even as his own attention moves toward IGTV and other, newer initiatives, the company has big plans for ephemeral posts. (He declined to share any specifics.) “I don’t think we’ve seen nearly the end of innovation on Stories,” He said. “For the first year or so, it was just about us getting it working on Instagram — just the basics,” he said. “After that year elapsed, it was, ‘What can we do with this format that’s unique?’ And only in the last six to nine months have we really stepped on the gas in terms of these unique features.”

“Only in the last six to nine months have we really stepped on the gas in terms of these unique features.”

Now that Stories are the primary feature driving visits to the app for a huge section of Instagram’s audience, some have speculated that, eventually, the original, permanent feed will see its prominence reduced. Might the feed one day swap places in the app with Stories, which now exists as a row of circular, side-scrolling icons on top of users’ permanent posts?

In some ways, Systrom notes, the feeds have already merged. If you scroll through the feed without first checking your stories, a carousel of stories is likely to show up in your feed. (This is one reason why Instagram’s regular reports on how many people use Stories, as opposed to the main app, feel increasingly meaningless: Instagram Stories and Instagram are now functionally identical.)

Sharing to the permanent feed is “very healthy,” Systrom says, but stories are the future. “The balance between the two is shifting only because we’re finding it to be more and more exciting to feature more stories,” he says. “But that doesn’t mean the feed goes away.” 

Instagram’s success to date has been notable. But the challenges facing it are multiplying. It has to avoid the mistakes of its parent company, even as its parent company puts more former Facebook executives in key roles. It has to continue its breakneck growth pace while maximizing the number of ads its users see. And it has to keep stoking the fires of novelty in Instagram Stories, the feature that has defined its recent history.

Systrom said his team’s plans are solid. “It’s just up to us to invent things,” he says.

The Interface /

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