As the world screeched to a halt in the middle of March, there was one place where I could still find normality: Instagram. My family was there—my mom sharing her latest artwork; my brother’s shots of his new baby—as were my friends, both real and aspirational. (DM me anytime, Chrissy Teigen!) But now I could also find a favorite fitness instructor teaching his usual Saturday barre class on Instagram Live, the stylists from my Brooklyn hair salon posting bang-trim tutorials, and the chefs of many of New York’s most beloved restaurants leading IGTV cooking lessons from home kitchens not so different from my own. Almost overnight, the life I used to lead in, well, life, had relocated to Instagram.

And that wasn’t the only change happening in my Instagram existence. As I temporarily retired workwear staples like sharp-shouldered blazers and commute-friendly heels, the ads filling my Instagram feed transformed as well. The screen was now bursting with sponsored posts for “plush upstate sweatpants,” leggings, and loungewear sets. The shift went far beyond clothing, to new-to-me ads for grocery delivery boxes, work-from-home desks, and DIY manicure sets. And, yes, reader: I clicked.

Instagram is having a moment, one that reveals the ways in which the smartphone app is almost perfectly positioned to capture—and capitalize on—The Way We Live Now. Since Instagram posted its first ad in late 2013, it has grown into a marketing juggernaut, albeit one that is sometimes lost in (or perhaps sheltered by) the looming shadow of its powerful parent, Facebook. The world’s preeminent social network, which acquired the photo app for $1 billion in 2012, doesn’t break out Instagram’s fi¬nances. But news reports peg the unit’s 2019 revenues in the $20 billion range, or about a quarter of Facebook’s total. And even amid a pandemic, that number is on the upswing. J.P. Morgan projects that Instagram revenues will climb more than 20% this year, despite the expectation that ad money being pumped into the core Facebook app will stay flat. Meanwhile, Instagram is already looking beyond its booming ad business, setting its sights on selling us stuff more directly. It is, says Cowen senior research analyst John Blackledge, “an emerging social commerce powerhouse.”

The app’s evolution into one of the Internet’s most potent tools for separating users from their cash cannot be severed from its relationship with Facebook. The parent, with its user targeting and sheer scale, provides Instagram the engine to turbocharge its own moneymaking machine. But Instagram also brings unique strengths to the endeavor, including its ability to be many things to many people. Are you tempted by the kind of carefully composed, art-directed ads you might see in a luxury glossy? You’ll find an endless supply on your feed. Or maybe you prefer your brands chatty, unscripted, and “authentic.” That’s what Stories—Instagram’s Snapchat-esque feature for disappearing photos and videos—is for. And if the very idea of an ad is a turnoff, how about getting a recommendation or 12 from your favorite celebrity or other “influencer”? They’re all on the app, tagging and sharing their way through their closets, homes, social lives, and vacations.

At its best, Instagram delivers on online advertising’s original promise, to be a helpful service that steers you toward things you actually want. As Jon Jackson, design partner at digital product agency Work & Co., puts it: “An ad only sucks if you don’t care about what it’s selling.”

That marketing magic is fragile, though. Even before the coronavirus upended the world’s economic expectations, there were plenty of questions about how long Instagram can keep us caring. Antitrust regulators yearn for Facebook to be broken up, a move that would deprive Instagram of its parent’s valuable algorithms. And Instagram, like all the cool kids of social media before it, faces the existential threat of being displaced by the new new thing. Today’s challengers include Snap and TikTok, but who’s to say what brilliant and deviously addictive new app some coder is dreaming up while quarantining in her apartment right now?

For those of us who have made the app part of our daily routine, though, the real question is, what happens if Instagram gets too good? In its early days, part of what made Instagram radical within the KPI-driven world of Silicon Valley was its focus on creativity for creativity’s sake. It was just a place to share and appreciate gorgeous photos. A lot has changed since then, but people still come to Instagram “to be inspired,” which is one of the reasons it works so well as an ad and shopping platform, says Vishal Shah, Instagram’s VP of product. He’s not wrong. But as the app continues to explore new ways to drive revenue, it risks reaching the point where the only thing it inspires us to do is spend money.

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Instagram first dipped its toe into the advertising world in November 2013. At the time, Instagram cofounder Kevin Systrom claimed he personally vetted each ad in an effort to keep the platform’s aesthetic bar high. Fast-forward to 2020: Both Systrom, who left the company in 2018 amid conflicts with Facebook CEO Mark Zuckerberg, and those stringent rules are long gone. Indeed, one of the most appealing aspects of advertising on Instagram is how easy the process is. “It’s literally checking a box,” says Debra Aho Williamson, principal analyst at eMarketer. Advertisers use the same tool that places Facebook ads; they tell the company whom they want to target and where the ad should run—or simply let Facebook make that decision for them. If that company is trying to reach, say, someone like me, Facebook uses my behavior on its apps (both Facebook and Instagram if the accounts are linked, as mine are) and elsewhere on the Internet to see that I’m a woman, age 35 to 45, living in New York City, who likes design, travel, and fashion, and—boom—that ad for the blush-pink Away suitcase lands in my Instagram feed.

Having established near domination in the digital ad market—only Google gets a larger share of the pie—Facebook is now pivoting Instagram toward the next revenue frontier, e-commerce. Since 2017, the platform has allowed for “shoppable posts,” in which a merchant can display pricing information about products shown in a photo, and with a tap take users directly to that item on the retailer’s site. In early 2019, Instagram waded deeper into the world of commerce, launching Checkout, which enables users to buy via PayPal without leaving Instagram. Shoppers enter their payment and shipping information once and then can buy from any of the participating sellers in seconds. Instagram takes a cut of all sales.

Checkout is still a small-time and rudimentary operation—it started with 22 brands and now involves “hundreds,” according to Facebook. The service has its share of skeptics, who call it bare-bones for its lack of shopping tools. But bullish analysts see a big opportunity. Last year, Deutsche Bank estimated Checkout could help drive Instagram’s e-commerce revenue to as much as $10 billion by 2021. And it’s not just its fledgling e-commerce business that makes Instagram essential to its parent. Analysts generally believe Instagram is growing faster, both in ¬users and in ad revenue, than the core Facebook app. eMarketer estimates that Instagram will surpass Facebook this year in terms of U.S. users age 12 to 24—a coveted demographic—and that by 2022, it will be responsible for more than half of the company’s total revenue. Instagram represents a PR coup for Facebook, too, as the photo app has managed to avoid most of the misinformation and data privacy pitfalls that have dogged Facebook. According to a 2019 poll by Pew Research Center, just 29% of Americans correctly identified Instagram and messaging service WhatsApp as being owned by Facebook. Either way, the $1 billion Zuckerberg spent to buy Instagram in 2012 was money well spent. “It’s one of the best acquisitions in history. Period,” says Blackledge, the analyst with Cowen.

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I can’t recall the exact moment I crossed over from Instagram photo poster to Instagram shopper. But over the years, the number of purchases I made or first spotted on the app has snowballed. There’s the pointy-toed Rothy’s flats, the Outdoor Voices leggings with matching hoodie, the Ferm Living planter, our new Article throw pillows. In the midst of writing this story, I messaged a friend who’d posted an Instagram Story of herself in some new joggers, asking, “Where are they from?” “Vuori,” she responded, adding: “Instagram buy :)” A pair are now en route to my apartment.

I’m not exactly proud of this behavior—but I know I’m not alone. A recent report from Cowen found nearly 40% of users ages 18 to 35 had bought something from a brand they discovered on Instagram. Overall, about 13% of U.S. Instagrammers said they had made a purchase directly through the app, and more than 60% said they “follow” a brand’s account.

The main reason Instagram is so pleasantly browsable is simple: pretty photos. Much has been made of how its aesthetic has spilled out into the physical world—remaking our public and private places to be “Instagrammable,” spawning #OOTD (the concept of posting a photo of your “outfit of the day”) and helping birth so-called millennial design—the muted pastels and sans serif fonts that rage on and off the app.

Instagram also has transformed digital advertising. The discipline of Systrom’s early gatekeeping has persisted; the ultimate news feed ad looks just like something one of your friends might post—only better. And one of the app’s most popular ad surfaces, Stories, has taught marketers the value of appearing spontaneous and unpolished. It’s a place where brands can string together a series of photos and videos, ideally conveying a ton of information without feeling heavy-handed. “IG Stories is the most powerful tool you can use to introduce your brand to the world,” says Daniel Romano, CEO and cofounder of marketing agency Good Moose.

And you can’t talk about Instagram without talking about influencers, the strange universe of digital demi-celebrities that the app, along with YouTube, created. Marketers spent an estimated $6.5 billion last year on influencers, according to Influencer Marketing Hub. These “creators” are a key part of the “formula” for selling things on the app, says Sheryl Maloney, senior director of digital partnerships at Adidas, an Instagram Checkout pioneer. She cites Ninja, a gamer known for, among other things, breaking streaming records while playing Fortnite with Drake, as an example of someone with the online clout required to get his followers to come to the platform to see—and buy—Adidas’s latest new “drop.”

The immediate question, of course, is which of these digital Jenga pieces will hold firm in a post-COVID-19 world, and which will come loose, leaving the whole structure swaying. The influencer economy is certainly at risk, as stay-at-home orders crimp their photogenic lifestyles, and messages of conspicuous consumption clash with the daily death toll in the news. Facebook has said that the ¬virus has created a “steep slowdown” in its ad business and that it sees “unprecedented uncertainty” ahead. But at the same time, global lockdowns have prompted a massive spike in ¬users and engagement on its apps, and people, stuck at home, are starting to change how they behave when they use them. On an April earnings call, Zuckerberg said that 800 million people are now tuning into live video on Instagram and Facebook daily. By way of comparison, about 102 million people watched this year’s Super Bowl in the U.S.

Instagram knows it must strike a balance between “organic” posts (like when your coworker shares a shot of his latest loaf of sourdough) and paid content. “There’s no one monolithic answer for all of Instagram or even any one person,” says Instagram’s Shah. Instead, the company uses data to try to put more ads in front of users who welcome them—and fewer in front of those who don’t.

As for me, I’m on the app more than ever: six hours and 24 minutes one recent week, according to my iPhone’s Screen Time report. But my posting became anemic—just two photos in my feed so far all year. No doubt the fact that I’ve been stuck in my less-than-photogenic apartment for the past two months has had something to do with that, but I think it also reflects a shift in my relationship with the app. When it’s time to reenter the outside world, I hope I can get closer to the way I used Instagram when I joined, back in 2012: to create, not just to consume. 

A version of this article appears in the June/July 2020 issue of Fortune.