How Much Does It Cost to Advertise on Instagram?

Open your Instagram app and scroll down. Look closely at each post and you’ll notice something. Every few posts, just under the account name, you’ll find the word ‘sponsored’. This means that the account has paid Instagram to get that post directly in front of you – it’s an advert.

Meta, Instagram’s owners, highlight that there are six different types of advert you can run on Instagram. These include:

• Images – images that appear in the Instagram feed
• Videos – videos that appear in the Instagram feed
• Carousel – a series of swipeable images/videos that appear in the Instagram feed
• Stories – videos or images in the Stories tab of Instagram
• Reels – full-screen content in the Reels section of Instagram
• Instagram Shop – specialist shopping ads that can take users to your website’s product details page

Each advert type can help you engage your audience in a different way. Picking the best format to catch the attention of your audience will deliver better results.

At its most basic level, running Instagram ads is a fairly straightforward process. However, there’s an art to getting the best ROI from your ads – this can take years to master. Our guide is here to help you get started. 

There are two approaches you can take to running ads via your Instagram account:

• Promote a Post on Instagram

With option one, all you need to do is post an image or video to your business account. Then, tap the ‘promote’ button that appears underneath it and follow the simple steps.

This is a quick and easy way to create an Instagram ad, however, it doesn’t offer you the level of targeting and insight that using Facebook Ads Manager does. If you want to get the best ROI from your ads, we suggest using option two…

• Facebook Ads Manager 

1. Connect your Instagram account to Facebook Ads Manager using Meta Business Manager
2. Go to Facebook Ads Manager
3. Select ‘Create’
4. Select your ad objective (make sure it’s supported by Instagram)
5. Create your ad and select your audience
6. Under ‘Placements’ select ‘Manual placements’, then select Instagram

Click ‘Continue’

With 2 billion monthly active users, chances are that your target audience is active on Instagram. This makes the platform an ideal place to drive profits.

Although Instagram ads come at a direct cost, there are many benefits to adding them to your marketing activities. Unlike growing your audience organically on social media, which can take a huge time investment (with no promise of returns), offering detailed, bespoke targeting using Instagram ads allows you to quickly and easily get your brand in front of the people who matter most. 

Practically every business can benefit from running Instagram ads. However, the speed and accessibility they offer make them especially beneficial to start-up businesses that haven’t had time to build an organic audience yet. It can also be a powerful tool for larger, more ambitious businesses that want to achieve rapid growth.

The numbers back it up. Although rates vary widely based on many factors (more on this below), Instagram ads are reported to produce average conversion rates of 1.08%. This makes it by far one of the best social media ad platforms (and general marketing channels) for generating a positive ROI.

Running Instagram ads isn’t as simple as paying a flat fee per result. Instead, like almost every social media advertising platform, they use a bidding system. This ensures a level playing field – with the most valuable/in-demand ad spots costing the most.

There are several key areas that impact the success/cost of your ads:

• Your bid – the more you bid, the more likely you are to win ad placements
• The relevancy of your ads – the more relevant your ad is to the audience, the more likely Instagram is to show it
• Estimated action rates – the rate at which Instagram thinks the audience will take action based on your ad
• Competition – competition can impact your bids in many ways. For example, certain times of year (such as Black Friday) can be more expensive, and so too can targetting audiences that are seen as high-value.

On Instagram, you can base your bid on Cost Per Click (CPC), Cost Per Action (CPA), or Cost Per Thousand Impressions (CPM).

So, how much does it cost to advertise on Instagram?

It should be clear from the last section that assigning an exact figure to Instagram ads is practically impossible. There are just too many internal factors (such as ad relevancy) and external factors (such as competition) that come into play.

However, there are average costs available, which will give you a rough idea of how much you may expect to spend on your Instagram ads:

Average CPM = $6

Average CPC/CPA = $0.6 – $0.7

One of the biggest factors that will impact these numbers is industry. For example, those who operate in industries with high levels of competition to access their audience through Instagram can expect to pay significantly more.

Like all marketing methods, whether running Instagram ads for your business is worth it depends on one key factor – real ROI.

Ultimately, the worthiness of Instagram ads depends largely on whether you can convert what you pay into a profit that outweighs the original investment. For example, even those who are able to generate a low CPC may find that ads aren’t worth the investment if they’re unable to convert those clicks into real sales.

However, with a huge, active user base and the ability to get super niche with your targeting, there are few businesses that couldn’t positively benefit from Instagram advertising – when done correctly. 

It’s clear that there is no one-size-fits-all answer to how much it costs to advertise on Instagram. Each business will find their costs differ widely based on factors such as competition and the quality/relevancy of the ads they are running.

Instead, businesses should focus on understanding the real term ROI they get from advertising on Instagram. This will help them evaluate the value of using this tool in their marketing mix.