The Business Times
THE BROAD VIEW

Pressures and perils of running an Instagram business

The platform wants sellers to post more, but its tools might not benefit people who earn a living through it.

Published Sat, Jun 26, 2021 · 05:50 AM

RACHEL Reichenbach likes to joke that she is the overlord of an Internet frog cult. It is not a bad job for a 22-year-old artist. Ms Reichenbach, who is also a full-time college student in California, began selling keychains, pins, plushies, apparel and other paraphernalia of her amphibian sketches in 2019, and as her Instagram audience grew, so did her sales.

Unlike most people we call "creators" on the platform (specifically influencers), she is not easily identifiable by her face on her social media. Instead, her drawings and animations of her signature blob-like, cartoon frog are what take centre stage. Frogs are her brand and business, and Instagram was the cornerstone of her merchandising success.

Her shop Rainy Lune is a one-person enterprise, even as she accumulated more than 107,000 followers. She is responsible for communicating with vendors and customers, shipping out orders, and marketing her products. And since Instagram is where she reliably draws most of her website traffic (and sales, as a result), most of her promotional efforts depend on the app - and her ability to game its seemingly elusive algorithms.

"I can't really take a break when so much of my income relies on posting and reminding people that I exist," she said. "I don't run any ads, so everything I do is based on organic reach."

But increasingly, Instagram seems to be demanding more from its creators and business owners. It is not enough to post and hope for the best; she needed a strategy.

Instagram, for its part, wants a little more. In February, she was contacted by a representative from Instagram, who asked her to consider integrating the app's "checkout" feature into her shop. The function would theoretically be more convenient for users since they would not need to leave the app to purchase an item - a potential boon to Ms Reichenbach's business. This was not the first time Instagram reached out to her: in December she was encouraged to more proactively use the Reels feature to increase her overall engagement.

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Instagram and its parent company Facebook have spent the past year integrating more commerce features onto their platforms. Initially, this emphasis was aimed towards businesses struggling amid the pandemic. Major social networks realised, however, there is significant revenue to be made through influencers and e-commerce; this attention has shifted towards creators and the burgeoning creator economy.

Instagram launched its inaugural "Creator Week" programming in early June. It was an opportunity to promote incremental updates to Creator Shops, an expansion of Instagram's existing shopping features that was first announced in April, and its native affiliate tool, which allows influencers to earn a commission for the product purchases they drive within the app.

But these tools, while well-intentioned, might not wholly benefit - or even apply to - people who earn a living through Instagram.

Ms Reichenbach is not among the many lifestyle and fashion creators that populate Instagram; she considers herself a mix of an artist and a small-business owner.

She remains sceptical about updates that might increase her business's dependence on the platform, even if it is promoted under the guise of creator monetisation. And while these tools are billed as a convenient way for creators to earn more money, there are no guarantees they can earn a living wage for this full-time work.

"As more social platforms begin to offer storefronts, influencers might be managing five to eight different shops on all these platforms and not own any of them," said Kit Ulrich, general manager of Like to Know It, an affiliate tool for influencers. With tools like Like to Know It, creators earn commissions through a page that lists their endorsed products.

For this reason, some vintage clothing sellers have also withstood Instagram's push to complete sales within the app. As helpful as it is for marketing, the platform's rigid interface and rules do not benefit how certain businesses operate. Jenna, a vintage seller from Portland, Oregon, prefers to use Instagram to market her garments, which she sells through Depop or via direct messages.

Ms Reichenbach decided to resist using Instagram's checkout feature for her shop.

"Instagram wants to insert itself as the middleman within these transactions," she said, adding that other artists share this concern.

"It would take commission from the sale, which is hard since I can't always afford that. There are also rules about how sellers have to send out orders in a certain amount of days and a 14-day return policy. As a small seller, I can't always adhere to that, and I rely on preorders to gauge interest."

She prefers her website to be the central domain where customers purchase her products, not Instagram. She enjoys the agency of her Shopify-powered store, but although Ms Reichenbach is her own boss, her business largely depends on playing by the app's rules. Most creators recognise this trade-off. It is a constant tug of war in the realm of digital entrepreneurship.

Ms Ulrich of Like to Know It says influencers and creators are realising they have more power over their business decisions.

"Influencers are building their own business and brands and curating products," she said.

"But they recognise that you don't build brand equity by spreading it out across multiple platforms. You can use other platforms to find new consumers and market your brand, but it's not feasible to operate so many separate stores."

BuzzFeed News's Stephanie McNeal recently described this sentiment as a "mini revolt" among Instagram influencers, who have felt that the app does not have their best interests at heart. Some have left or are on hiatus while others have channelled more effort into platforms like Patreon, OnlyFans or Substack that allow them to directly monetise their fans.

Creators have long been frustrated at the difficulty of earning a consistent living when their engagement metrics can fluctuate from month to month. This is not a problem specific to Instagram; YouTube vloggers, Twitch streamers and young TikTokers have complained about being burnt out. Yet the ability to quit a platform cold turkey - to stop posting for weeks or months at a time - is not feasible for full-time creators whose income is primarily generated from their online activity.

The creator economy thrives on a disaggregated, individualised culture of work, but its participants are not freed from the constraints of hustle culture. In fact, it is easier for the realm of work and life to blend together, erasing any sense of digital autonomy when they are logged online.

Instagram's latest creator tools are an opportunity for more users to directly earn money. It is also reflective of the app's paternalistic hold over creators' behaviour - how frequently they comment, post, share and stream. VOX

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