Biz Lessons Behind Instagram Making $660M on Blue Checkmarks

0:00Welcome to Marketing School, the only podcast that provides daily top-level marketing tips and strategies from entrepreneurs that practice what they preach and live what they teach. Let's start leveling up your marketing knowledge with your instructors, Neil Patel and Eric Hsu.

0:20All right, so we're going to talk about something crazy, something that is$660 million crazy. Ergo, Instagram made$660 million on the blue check marks, and that is$44 million. So Neil, do you want to elaborate on this one a little bit, or I can elaborate? Yeah, so there's some press articles that ended up coming out, and with Instagram, they ended up making, as Eric mentioned,$660 million all from charging for blue check marks. And I believe that happened in the first 24 hours of them going out and charging for that blue check mark. The exact numbers were they sold 44 million blue check mark verifications in one day at$15 a month, making them a whopping$660 million, literally in just 24 hours, which means that number, if it stays true and holds, it's going to get into the billions quite quickly.

1:13You know what's nuts? I mean, I don't know what, Neil, if you can check what the MAU is on for Instagram versus like a Twitter as an example, but I would bet that Instagram is a lot bigger. And the other thing is Instagram, when it first came out with, I think they're the ones that popularized the blue check marks. And so the whole idea is that this whole time, the last really, I think Instagram started in 2010 or so, but for the longest time, people have wanted blue check marks. I've had a lot of friends ask me, Eric, how did you get the blue check mark back then? Same for Neil as well. You're nodding your head.

1:42Do you want to say something? Yep. So going back to that stat, it was, I'm like, I don't know why this Cocomelon, my kids things are popping up on my computer, but 2.35 billion monthly active users. That's a lot. Yep. It's a lot bigger, a lot bigger, right? I think Twitter is around like 230 MAUs or 230 30 million or so out of like 440 million, something like that. 450. Okay. Yeah. Yeah. So that's MAUs or total users. That's monthly active users on Twitter. And I'm just Googling this. So who knows how accurate these articles are, but you're looking at roughly a difference of five times. So Instagram has five times more monthly active users than Twitter based on the points that I'm seeing online.

2:24The point behind all this is that status, people will buy status, right? If you look at back in the day, in the 1920s or so, I think it's less than 5 % of people owned a stock. That's when the stock markets were starting to come out and all that. And then what ended up happening was more and more people wanted to own stocks because the wealthy owned stocks. Just like maybe the 40s, 50s or so, all the wealthy people would go to Europe during the summer. Now you see a lot of people going to Europe during the summer. And same thing with the status here. All the celebrities, all the rich people or whatever, or notable people, whatever you want to call them, they had blue check marks.

2:57and everyone wanted a blue check mark. I kid you not. I bet you Neil, like people would ask me all the time, how did you get it? How did you get it? And they're like, they would just hound you, hound you, hound you, right? No, no, no. Now here's the issue. Dude, if everyone can just go buy it, I think it's going to lose its novelty. It's just a question of when. That's where I'm going. Look, it's already lost its luster. And so what's going to happen next is one status can be purchased. Everyone should know that. But the other thing is, if you look at Twitter, they actually have custom company pages.

3:22There's gold badges and all that. I bet you they're going to have something where, you know you're gonna have like the old like legacy ones can have a different color i think there's gonna be an entire business they're gonna build around the badge stuff yeah and elon ended up innovating it for a lot of these guys and now they're just like huh if elon can make money on it we'll make way more than him because we have way more users because it's not just instagram instagram i don't know what they'll do with whatsapp then you also well technically they can do there's a lot of fraudsters on whatsapp so instagram whatsapp facebook the list goes on and on but like you're probably talking if they did 660 million in 24 hours, you're talking about easily three, $4 billion that they can figure out to generate from this checkmars stuff.

4:02And it should be mainly profit. I don't see how they have a ton of expenses on this stuff. Yeah. And so I think this is a smart business. I think there's a couple of business lessons here. One is status sells. Okay. Two, it's okay to copy other people and you know, you have another angle on and arguably Instagram's doing it better because there's some bells and whistles behind it. And you can actually see who's like legacy verified versus not. I do think I've already seen some people that have legacy check marks. They're saying, well, legacy check marks should have a different color. I agree with that.

4:29I think if anybody's going to do this, maybe innovate a little more on this, it might be Instagram and Facebook because they just have more employees. So I think everything will be set. Like the people that are legacy check marks, you know, they will have their status like maintained. And then we're going to see the new blue check marks. We're going to see gold check marks on all this. I just think we're going to see the next wave. and you can argue that it's taken a while to get there. And it's once again, you know, you have Elon trying this stuff and experimenting with stuff. So that's the other marketing lesson here.

4:55It's to constantly experiment. And, you know, sometimes the market will take it and sometimes the market won't. Anything else? Yeah, actually one thing to add is what's funny is everyone typically believes there's one way to do stuff in marketing or business. That's not the case. Elon came up with a different business model. Facebook could have done this way before Elon. Instagram could have done this a long time ago. TikTok could have done this a long time ago. LinkedIn and the list goes on and on, but no one really tried it just because something works and is the status quo. And that's what everyone's used to like ads.

5:25It doesn't mean that's the only solution out there. All right. So that's it for today. Don't forget to subscribe to us on YouTube, rate, review, and subscribe. And we will see you later. We appreciate you joining us for this session of marketing school. Be sure to rate review and subscribe to the show and visit marketingschool.io for more resources based on today's topic, as well as access to more episodes that will help you find true marketing success. That's marketingschool.io. Until next time, class dismissed.