SHOULD INSTAGRAM TRY TO MAKE A PROFU strategy is slanted toward platform growth, but this is likely to change as more ways to monetize the service are discovered.? ince its Facebook acquisition, Instagram has Instagram is one of many online tech com- panies that are prioritizing company growth active users per month, with a third of those liv. over profits. Pinterest, Snapchat, and Tumblr ing outside the United States. To generate rev are following a similar strategy as Instagram- enue Instagram has begun to slowly incorporate focus on growing a larger user base and paid ads into its platform despite objections from worry about profits later. Amazon.com has many of its users. Instagram had already previ also maintained very low profits to continue to ously been forced to roll back an updated user grow rapidly in its markets. policy when users complained about the fact Facebook expects that Instagram's mas- that it would have allowed the company to use sive user base will translate into future privately uploaded photos in advertising. Insta revenue, but choosing the correct time to gram realized that it needed to reach a delicate aggressively promote monetization of the balance between user privacy, profit, and func services is critical. The highly personalized tionality. Although there is a huge potential to nature of social media, privacy expectations increase profits through ad revenue, showing too from users, and profit obligations to share- many ads poses the risk of losing customers and holders is a balance that Instagram needs to degrading the image and usability of the service. continually maintain. The company's current Discussion Questions 1. Should Facebook continue following its strategy of using Instagram to amass a larger user base rather than working to make the service more profitable? 2. How can tech companies increase good will and indirectly affect profits for parent companies? 3. What is the best way to incorporate adver- tising into Instagram feeds while limiting the amount of resentment among current and future Instagram users