Why it’s important
Instagram’s Reels competes with ByteDance’s TikTok and YouTube Shorts, as users find short-form videos more engaging, driving marketers to adopt the format at a time when Meta is looking to boost revenue from the product by placing more ads.
Context
If a TikTok ban takes effect in the US, Reels and YouTube Shorts could become attractive alternatives for advertising, potentially boosting Instagram’s growth.
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Key quotes
Discover the stories of your interest
“Instagram is now a video-first platform, with users spending close to two-thirds of their Instagram time watching videos,” Jasmine Enberg, principal analyst at Emarketer. “If the TikTok ban is enforced in 2025, Instagram could capture over one-fifth of reallocated TikTok ad dollars in the US,” Enberg added.
By the numbers
In 2024, Instagram’s ad revenue primarily came from its Feed and Stories features, contributing 53.7% and 24.6%, respectively.
However, as Reels’ revenue increases, the combined revenue share from Instagram Explore, Reels and potentially Threads is projected to rise to 9.6% in 2025.
