Instacart is going all in on ads. Here’s why.
The Hustle

Instacart is going all in on ads. Here’s why.

Instacart’s ad business is projected to be $1B in 2022. This may put it in competition with its grocery partners.

Photo by Lane Turner/The Boston Globe via Getty Images

Like your aunt and uncle, Instacart is a big fan of Facebook.

Specifically, its high-ranking execs.

In 2021, the $39B grocery delivery startup poached its new CEO (Fidji Simo), COO (Asha Sharma), and president (Carolyn Everson) from the House of Zuck.

No, Instacart isn’t building a social network…

… but its ads business is on the rise, pulling in ~$300m in 2020 with projections to hit $1B in 2022, per The Wall Street Journal.

What exactly are Instacart ads?

Ads are critical as delivery slows

Instacart’s delivery business boomed during the pandemic. Growth has understandably slowed by the startup is facing other headwinds, too:

Grocery chains typically sell shelf placement…

…to consumer brands (e.g., eye-level chewing gum at checkout) but may lose that revenue stream if those ad dollars are routed to Instacart.

WSJ notes that brands typically have separate budgets for in-store and digital ads. This could change in a post-COVID world — and if it does, grocers may like Instacart a lot less than Instacart likes Facebook.

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