How Instagram’s New Business Tools Benefit Local Businesses

How Local Businesses Will Benefit from Instagram’s New Business Tools

Instagram is turning up the charm as it looks to court more mom-and-pop shops. The social media site collected feedback from business owners, asking them how to improve Instagram. After hundreds of interviews, Instagram says, “three key needs became clear—businesses want to stand out, get insights and find new customers.”

As a result, Instagram’s business tools were introduced late this summer.

The visually dominant platform hopes the new tools grow its advertiser base, which according to Instagram, is about 200,000 brands strong. It’s a pretty small number when compared to the two million advertisers on its parent company, Facebook, but the growth of advertisers is impressive. In June, Instagram only had a few hundred advertisers, according to TechCruch.

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Are you curious about the new tools? Here’s a look at Instagram’s business tools and how they can help brick and mortar stores:

Business Profiles

Instagram profiles all look the same. Whether you’re an individual or a business, it didn’t matter – until now. Instagram introduced Business Profile, which allows businesses to create a profile page that sets them apart from individual pages.

Business Profiles now have a ‘contact’ button next to the ‘follow’ button. The contact button gives potential customers a way to call, text or email the business.

Before this feature, the only way for followers to interact with a business was by leaving a comment on a post. During the interviews, businesses told Instagram that sifting through comments was a tedious and cumbersome way to interact one-on-one with potential customers. As a solution, the ‘contact’ button was born.

The contact feature doesn’t just allow customers to get in touch with your business; they can also get directions to your store. That’s great news for local stores because it provides a way for an online follower to become a paying customer.

The business profile makes it easier for customers to recognize a business on Instagram and connect to it, via contact information or by getting directions to the actual store.

Here’s what it looks like when someone clicks the ‘contact’ button:

How Instagram’s Business Tools Will Benefit Local Businesses


A Business Profile is a great first step, but businesses wanted a way to reach new customers.

Given its visual nature, it’s not surprising to learn that 60 percent of users learn about a product or service via Instagram. Businesses knew it, but they didn’t have an easy to way to turn that inspiration into a sale. Now they do.

Instagram introduced the Promote feature, which allows businesses to turn an ordinary post into an ad. Businesses just add a simple call to action button to the post.

An ordinary post shows up in followers’ feeds, but an ad can target new customers. Businesses select a target market when creating the ad, and decide how long they want the ad to run.

The ads are fairly basic. Instagram says the simplicity is by design because everything is done within in the app.


Instagram has also introduced Insights. This tool provides businesses with basic analytics like demographics, top posts, reach, impressions and engagement ratings. All of which are helpful ways to track the success of your posts.

Within these analytics is consumer location information. In other words, businesses will be able to see where their Instagram followers live. It’s another great feature for brick and mortar shops that are gathering information about their customer base.

That information may help you make additional advertising decisions. For instance, maybe you have a lot of customers that live in an affluent part of town. You might decide to advertise some of your more expensive items to that segment.

Or, you might learn that a lot of your customers are abroad. That might encourage you to set up an online store to capitalize on that market.

Additional information you should know

The tools are available to all businesses in the US, but there are a few interesting quirks you should know about before signing up:

  • You must have a business Facebook Page

These new tools are only available to businesses that already have a Facebook business account. Given that Facebook owns the app, it’s not surprising that the two are married.

  • Creating profile on Instagram is step one

You have to create a Business Profile on Instagram before you can access the other two tools.

  • Ads and tracking information are basic

The ads that businesses can create are fairly basic. Instagram claims this is purposeful, as it makes creating an ad simple within the app.

The Insights are also basic. The location data is helpful, but if you’re a numbers junkie, you might feel this section is lacking. Again, Instagram says the statistics provided are basic so a bunch a numbers or charts don’t overwhelm businesses.

Interested in trying out Instagram Business Tools? Here’s a guide on how to get started.

Lisa Furgison
About the Author
Lisa Furgison

Lisa is a writer at Fivestars, a freelance journalist, and co-owner of a media company, McEwen's Media.

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