Adam Mosseri, the CEO of Instagram, has addressed misconceptions regarding the reach of sponsored content posts. He clarified that even though a post is tagged as sponsored content, Instagram does not reduce its visibility. Creators can tag posts without fear of decreased reach. Tagging is done to inform Instagram which content is sponsored and to comply with laws in various countries.
According to Social Media Today, sponsored posts may have lower engagement because users naturally engage more with organic content.
TLDR: Instagram CEO Adam Mosseri addressed misconceptions about sponsored content posts not affecting reach and clarified that tagging is for transparency and legal compliance.
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