How Instagram’s algorithm shift is hurting small businesses

Sana Javeri Kadri relied heavily on Instagram for marketing when she founded her spice company, Diaspora Company, in 2017. “I give them full credit for our growth — and then the algorithm changed and our sales dropped at a staggering rate,” she said. “There was a point where I dreamed that Instagram could go back to what it was and my nightmares were about all the reasons why that wasn’t possible.”

Since joining Instagram, Diaspora’s following has grown to over 100,000. “Until three months ago, we never paid for ads on Instagram,” Ms Javeri Kadri said, although the company has used PR agencies. “These aren’t hard numbers, but we used to see 2,000 to 3,000 likes on most posts for our 100,000 person audience,” she added. “Now it’s 200 to 300.”

Since the launch of Instagram in 2010, sharing food photos, writing a thoughtful caption, and adding relevant hashtags has been the foundation of many small food companies’ social media strategy and a cost-effective form of advertising. Then, in late 2021, Instagram’s parent company, Meta, changed the platform’s algorithm to prioritize videos called Reels. Accounts that don’t regularly post the short-form videos appear in users’ Instagram feeds among those who have adopted the format, causing a noticeable drop in post engagement — and therefore sales — for many small businesses.

“With the way that Instagram has shifted everything to video, it has really reduced the traffic that we get to our Instagram account and therefore our website,” said Skyler Mapes, a founder of Exau Olive Oil. “You have to fight harder than ever to get out there and be seen.”

Adam Mosseri, the boss of Instagram, announced the change a video posted on his Twitter account in the last days of 2021. “We will double our focus on video,” Mr. Mosseri said. “We’re no longer just a photo-sharing app.”

He added that the company is focused on the growth of Reels, which launched in August 2020 in apparent response to TikTok’s success. Reels appear in an Instagram user’s feed and content discovery page; The videos may only be one minute long and can be filmed and edited within the app.

The change has shaken small food companies and their social media managers. Instagram feed captions have acted as a direct line to consumers and a way to humanize brand accounts.

“It was terrifying because I was really good at taking beautiful photos and writing long emotional captions,” said Ms. Javeri Kadri, “and suddenly over the past six months I’ve been grieving the depreciation of that skill.”

While moving to Reels doesn’t require a lot of writing, it does require video production experience. Instagram tells its users that successful reels are of high quality; Use text, filters and camera effects; are accompanied by music and trendy sounds; and are “entertaining and funny,” with content that “delights people, grabs their attention, makes them laugh, or has a funny surprise or twist.”

This is no small feat for business owners and social editors who lack video editing skills. Abigail Knoff, director of marketing at mushroom company Smallhold, finds this is a much bigger boost for her team.

“The planning, editing, voice-over and music skills for more produced video content are very different than still photography with the iPhone,” she said.

Ms. Knoff is left with two options: “We can occasionally work with freelancers, who are rightly more expensive, or be patient while we learn these new skills on the job.”

Some Instagram managers who have these skills still have to pay for outside help. Danita Evangeline White, who runs social media for Trade Street Jam Company, has seen a 38 percent drop in reach, or the number of users seeing the company’s content, over the past 90 days. Traffic on the company’s website has also dropped by a third since the end of 2021. Ms. White has since integrated more videos into the company’s account, which has about 25,500 followers, but she believes its content is still not prioritized by the algorithm.

After evaluating its options, Trade Street Jam hired a social media consultant to conduct an Instagram audit. “Our founder is the only full-time employee; We don’t have a lot of budget for outside marketing or consulting,” Ms. White said, but “we thought it would be a worthwhile investment.”

A new popular way for a business to end reliance on Instagram’s algorithm: switch to another platform.

PJ Monte, the founder of Monte’s Fine Foods, turned his attention away from Instagram and towards TikTok. “Because there are virtually no followers on TikTok, I watched two videos a few million times,” said Mr. Monte.

Ms Javeri Kadri also shifted her focus to TikTok, and after six months, Diaspora had her own viral video. As the company’s fan base grew on the platform, she said, “but it’s not like TikTok is suddenly making the money,” as the app doesn’t have built-in shopping features or links like Instagram does. (The company declined to provide sales figures.)

Brands whose outcome remains unaffected have foreseen the inevitable change in algorithm. Denetrias Charlemagne, one of the founders of Avec Drinks, avoided investing heavily in social media from the start, instead relying on public relations and word of mouth.

“Our strategy has never been to build on Instagram,” said Ms. Charlemagne, who has media relations experience. She pointed to Facebook’s decision to change its algorithm in 2018, which deprioritized branded accounts and reduced traffic from media companies.

Ultimately, the success of small businesses on social media rests in the hands of a few corporations.

“These platforms do not belong to us, they belong to technology companies,” said Ms Mapes from Exau. Now that she’s “having to fight harder than ever to get out there and be seen,” she said, “I’m over it.” How Instagram’s algorithm shift is hurting small businesses

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