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Why the algorithm makes sense

  • Writer: Davey Hiles
    Davey Hiles
  • Oct 14, 2024
  • 2 min read

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The Economics and Addictive Machine of instagram

Why does my content not do well?


\While the Instagram algorithm may feel frustrating, there is solid logic in its motivations. Instead of debating how or why some videos ‘get more views’ I will lay out the framework that anchors the algorithim’s goals.


Instagram (as you know) is one of the largest advertising platforms ever created. Given an estimated 1.4 billion users worldwide, This ad revenue is primarily generated by In-feed advertisements. 


In-feed ads make up most of the platform’s ad revenue

Oberlo reports that Instagram ad revenue reached $50.58 billion in 2023. 

Instagram’s revenue per user averages at around $43,

Meanwhile, ads on Instagram Stories made up 26.7% of the platform’s ad revenue. 



Watch time 

To drive this watch time, Instagram must serve its users content that is best for each user - this is their best chance at maximizing their watch time which is ~related to their ad time. 


Gone are the days of the chronological feed - content is served for a purpose: to bring the user back to view more content thus increasing the hit rate of the embedded ads.


The Instagram algorithm must enhances the user experience by delivering highly relevant and engaging content. By prioritizing content that engages it’s user for longer periods


Instagram not only enhances the user experience by delivering highly relevant and engaging content.



Average Useage



In 2024, it’s anticipated that Instagram ad revenue will reach $59.6 billion.



This has a very strong secondary effect - and its probably the reason you are reading this post. Content creators (read any one who is trying to drive engagement) have to create content that is worth engaging with. Without creating engaging content, creators limit their audience and watch time and ad click through rates fall. 


In this way, Instagram's algorithm, with its emphasis on watch time, serves as a cornerstone for both enhancing user engagement and driving the platform's revenue generation, illustrating a harmonious balance between user experience and economic viability.


 
 
 

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