How Much Do Instagram Ads Cost?

How Much Do Instagram Ads Cost?

Instagram ads cost

There is no denying the fact that Instagram is the social media hub for millennials, influencers, celebrities, etc. However, what you perhaps didn’t know was that it has over 1 billion monthly users! Don’t believe us? See it for yourself:

With such a massive number of users, it’s no wonder that Instagram is a social media platform that is simply ideal for businesses to reach different leads and potential customers interested in their services, offerings, and products. With Instagram ads tailored for your target audience, you can connect with even more leads and exponentially expand your business via Instagram ads.



Many people ask, “how much do Instagram ads cost?” Let’s discuss this in detail.

How Much Do Instagram Ads Cost?

Well, the cost of Instagram ads depends entirely on your chosen bidding model, such as cost-per-impression (CPM) or cost-per-click (CPC). On average, businesses cough up $6.70 per 1,000 impressions and $0.20 to $2 per click for Instagram ads. However, the biding models are not the only factors that determine the Instagram promotion cost— there’s so much more to it!

Read on if you want to learn more about, “how much do Instagram ads cost?”

How Much Do Facebook and Instagram Ads Cost?

Instagram and Facebook are inarguably two of the largest and most effective social media platforms accessible for advertising today. However, have you ever wondered about the difference in the cost of advertising on Facebook and Instagram? Which of the two is the most economical medium for your business and which is the most ideal platform to reach your target audience?

Here is a comparison of the advertising costs for the two platforms:

Now that you know the advertising costs of both these platforms, let’s also look at the demographics of both Facebook and Instagram. While with Facebook, you can easily reach a wide range of age groups, Instagram is perfect for reaching and connecting with a younger demographic such as teens and people in their early to late 20s.

So, whichever platform you choose to advertise on should definitely include the specific demographic you want to target. While you might advertise your products and services on a lesser rate on one platform, it might lead you to lose the significant opportunity to connect with potential consumers and leads that will add the most value to your campaign’s outcome.

Now, let’s take a look at what exactly determines an Instagram ad’s price.

Factors That Determine the Cost of Instagram Advertising

Instagram advertising cost is heavily dependent on the following four factors:

1. Bid Amount

Your exact bid amount impacts the amount that you will spend on your Instagram ad campaign. You need to ascertain exactly how much you are willing to cough up to generate and attract new leads. Since Instagram has loftier bid amounts, you will want to go in equipped to pay more for clicks and impressions.

For instance, if your bid amount is $2 per click and you only have a budget of $1,000, you will only get 500 clicks on your ad. The more you increase your budget, the more clicks you are going to get. What’s more is that if you have a budget of the same amount, but your bid amount is significantly lower, then you will be able to get even more clicks. So, simply put, your exact bid amount will impact your budget and your budget will have an impact on the amount that you can bid. These amounts will determine the social media advertising cost on Instagram for your business.

2. Ad Relevancy Score

The relevancy score of your ad will also have a significant impact on the cost of your Instagram ads. As the name suggests, the relevancy score is basically just how relevant Instagram deems your ads to be in regard to your target audience, aka those individuals who will see your ads. Instagram wants to display highly relevant content to its users on their feed.

So, how does Instagram calculate this score? Well, your score will be based on the basis of how individuals react toward your ads. If individuals respond positively toward your ad campaign, your relevancy score will grow. Signs of this positive response include an increasing number of likes, comments, clicks, and more.

Meanwhile, actions such as an individual choosing to hide your ad will be counted as a negative reaction. This will result in Instagram giving you a poorer relevancy score, which will negatively impact your ad’s overall performance.

Ads that have a high relevancy score are definitely preferred over the ones with a low relevancy score. If you have an ad that’s highly relevant, you will end up paying closer to the lowest amount. This will allow you to get more clicks within your budget, which will lead you to generate more leads.

3. Projected Action Rates

The Instagram sponsored ads’ cost is also impacted by the estimated action rates. According to Instagram, this rate is created on the expected reaction of people to your ad – it takes the probability of people getting motivated to act on your ad into account. Simply put, Instagram wants to assess just how likely it is that your audience will engage with and react to your ad.

These engagement signs include clicking on the ad and then converting via clicking on the given link. The idea is that Instagram will readily promote those ads which it believes will urge people to interact and engage with the content that you put out there.

So, this estimated action rate will also determine the cost of your Instagram ads. If Instagram has reason to believe that more and more people will likely engage with your content, it will automatically put your ad first. What this essentially means is that your bid amount will be lower, which will lead you to generate and convert more leads.

4. Competitors

Your competitors will always have an influence on the cost of your Instagram advertising. When you try to connect with a specific demographic or target audience on a social media platform such as Instagram, there are always bound to be other brands and businesses attempting to reach the same target audience.

So, your competitors can definitely alter the price of your Instagram ad campaigns. How so? Well, if there are other businesses trying to reach the same target audience as you via bidding, it can actually result in a serious bidding war. You will have to actively outbid your competitors in order to get the top spot. This will ultimately lead your CPC to go up as you try to outbid your competition.

Supplementary Factors

There are many other factors as well that have the power to influence social media advertising cost on Instagram. So, let’s take a look at some of the more common ones:

  • Special events and holidays: Competition between companies is at an all-time high during holidays, particularly Christmas. More and more businesses are competing with each other to reach and convert valuable leads, which shoots up the CPC. So, you will definitely need to consider the impact of holidays and special events that come around the time when you choose to run your ad campaign and estimate the costs for it accordingly.
  • Day of the week: Instagram users prefer to engage with content more on weekdays than on the weekend. So, to drive more engagement and generate new leads, you need to post your ads on a weekday, preferably Wednesday.

  • Gender: Did you know that it will cost you more to advertise to women than men? Well, it’s true! This is because women are more likely to engage and interact with your posted content on the platform.

  • Age: The CPC of Instagram ads is also dependent on the age group of your target audience. The ages with the higher CPC rates fall between 18 to 44 years of age, which makes sense considering they are Instagram’s most valuable demographic.

  • Your industry: The market or industry that you are a part of also plays a role in the cost of Instagram ads. For B2B businesses, it’s more costly to run ads since there are fewer companies on Instagram than people. For some industries such as apparel, it’s incredibly costly due to high competition.

Now that you have a clear picture of the factors that will affect your Instagram ads’ cost, let’s take a look at how Instagram ads work.

The Working Behind Instagram Ads

Instagram ads are basically paid content posts posted by marketers and businesses on Instagram that appear on stories and newsfeeds. These ads are specifically targeted toward individuals who are most likely to show interest and engage with the products, services, and offerings of your business.

People who use Instagram see these ads on the basis of their demographic data and their recorded interests. Instagram blends these ads so seamlessly into the user’s experience that they are hardly ever recognized as blatant ads, which increases the likelihood of engagement.

However, there are two clear indicators that usually give away the content as a paid ad on your newsfeed. The first of the two is the word “sponsored” inscribed under the company’s Instagram handle. The second indicator is the call to action (CTA) that usually appears toward the foot of the ad. These CTAs usually have phrases such as “learn more” or “shop or call now”, depending on the goal of the ad campaign.

How to Lower the Cost of Instagram Ads

To successfully advertise and market on social media platforms, you need to do everything you possibly can to reduce the cost of advertising. So, here are some tried and tested ways that will help you reduce the price of your Instagram ads and increase the return you get on them.

1. Utilize Automatic Bidding

If you’re new to the world of Instagram marketing and advertising, it’s important that you learn to make use of automatic bidding for your ad campaigns. It’s a relatively simple way for you to score a bid that is the most ideal and beneficial for your campaign.

Automatic bidding is good for your business, especially if you are inexperienced and don’t have any established data to give you an estimate CPC that you can fix for your ad campaign. It effectively helps you fix the bid amount that is ideal for your campaign.

When you choose to use involuntary bidding, you are effectively preventing the risk of overbidding to run a campaign. This is because of the clear lack of precise data can make it hard to know and gauge the ideal bid amount. This might lead you to bid more than you essentially need to bid.

So, make sure to use automatic bidding at least until you acquire enough data to help you through your ad campaign. It is a solid way to significantly reduce the overall cost of Instagram advertising.

2. Use Accurate and Detailed Targeting

When you run an Instagram ad, the main idea behind it is to connect with individuals who will be attracted to your services and products. So, to generate the ideal outcomes for your ad campaign, you need to use precise and detailed targeting to effectively reach your target audience.

Instagram presents you the opportunity to reach your target audience through the following ways:

  • Location: It allows you to target individuals on the basis of their locations. It may be as particular as a postal code or as broad as a country.

  • Demographics: the most widely used way to target leads is via their demographic data. This data includes relevant material such as age, gender, race, etc.
  • Interest: With social media interaction, you can form a clear pattern of where a person’s interest lies. Whether its art, technology, science, or food, you can create a target audience on the basis of their likes.
  • Behavioural patterns: If your leads venture onto your website and have a specific pattern to browse through it, you can aim to engage with new leads based on this established pattern of behaviours.

  • Custom audiences: This includes specific audiences that are specific to your particular business – individuals that you already know are willing to engage with your brand and are interested in knowing about your products and services. With a custom audience, you can incorporate relevant information, such as e-mail addresses, into your targeting routes.

  • Lookalike audiences: Once you have an idea of the kind of individuals who will be attracted to your company, products, and services, you can target specific people who share comparable behavioural patterns or interests to them. It allows you to target individuals who haven’t yet found out about your business and introduce them to your products and services, which they will surely be most attracted to them.

When a business uses precise targeting, it can reach a more specific target audience who will be interested in its services and products. This essentially means that your ad copy is more relevant and meaningful to them. This will help you achieve a higher ad rank and a lower CPC. Additionally, it will lead to more conversions, which will help you balance the cost of organizing your ad campaign

3. Establish Specific Goals for Yourself

Whenever you run an ad campaign, one of the first crucial things that you need to take care of is to set some achievable goals that you can achieve during your campaign. If you set these goals, it will help you stay focused on everything that you want to attain with your campaign.

With Instagram ads, there are three major goals that you need to focus on:

  • Awareness: If you choose to design your ad campaign around awareness, you will have to create content that focuses on spreading awareness about your company, brand, app, product, service, etc., to your target audience. You want to introduce your brand to as many people as you can and help them familiarize themselves with it. If you have the goal of awareness in your mind, you need to focus on running an Instagram CPM
  • Consideration: If your target goal is a consideration, your focus needs to be on educating your target audience about your brand. You will need to offer your audience relevant and compelling information about your business and brand that will help your new leads convert. To achieve this goal you will need to run a CPC campaign rooted in earning website views, clicks, and approaching and acquiring leads.
  • Conversion: If your aim is to convert your leads into becoming your customers by buying your products, downloading your app, or using your services, then you need to run a conversion campaign. When your focus in an ad campaign is on conversions, you have to offer your target audiences a compelling ad copy that never fails to grab their attention and gets them to utilize your services or buy your products.

By setting specific goals for your campaign, you will end up with a more tailored and cohesive ad campaign to run. You will know exactly what you want to accomplish with it, which will help you create a more impactful ad copy. An effective ad copy with specific goals behind it helps increase engagement and leads to more leads and conversions.

4. Generate Highly Applicable Landing Pages

Generating highly relevant and appropriate landing pages is another fantastic way to lower the overall Instagram ad costs. Innumerable businesses make the basic mistake of guiding their new visitors and leads to their websites’ home pages after they click on their Instagram ads. It does not encourage any engagement as the interested individuals are not taken directly to a landing page that is relevant and linked to the ad that they clicked on in the first place.

Simply put, when you create an ad for Instagram, the ad and creative links should be related and cohesive. For instance, if you are advertising your collection of winter coats, your ad link should take interested individuals to a webpage filled with coats from your collection. If you direct them to your homepage, they will get an overview of all the services and products instead of specific coats that the interested individuals clicked on the ad for, making the connection between the links quite irrelevant.

This is where relevant landing pages come in. You direct your leads to a webpage that is tailored perfectly to the content of your ad. Highly relevant landing pages lead to more leads turning into customers. When users are taken straight to the products they saw displayed in your ad, they are more prone to convert. This also helps you recover the cost of your ad campaign.

5. Test Your Ads

If you want to reduce the cost of your Instagram ads, then you need to test your ads in front of a small segment of your target audience. Every time you create an ad copy, it will rarely ever be the most effective or perfect form of your final ad. So, it is vital that you test your ad to make sure that you are putting the best version of it in front of your target audience.

If you test your ad before posting it, it will help you create an impactful and relevant ad copy. An appropriate and relevant ad copy leads to a higher ad position and a lower CPC. It’s a simple and effective way to reduce the cost of Instagram ads.

How to Introduce Instagram Ads

So, if by now, you are prepared to start running your own Instagram ad campaign, here are 3 varied ways in which you can do so:

1. Through the Instagram App

When you access the ads in the Instagram app, you can share those posts as ads that you have already made on Instagram. You simply have to open the app and choose the post that you need to campaign with. Once you have selected your chosen post, you can proceed to introduce it as an ad. After launching the ad, you can track exactly how many users have seen and interacted with your post.

2. In the Ads Manager Tool

Instagram ads use the Ad Manager tool that Facebook utilizes. You can easily run your ads via this program as well – it’s pretty easy and well-organized. If you choose to use Ads Manager, you can easily set up your ad campaign, make the desired changes to it, and track the results of it. It’s undoubtedly a solid way to run an Instagram ad campaign.

3. Instagram Partners

If you require additional support to run your ad campaign or are too short on time, then you have the helpful option to utilize Instagram partners. They can help you to seamlessly run your ad campaign if you don’t have the time or the energy to learn how to run an Instagram ad campaign. They are proven experts who are assessed and approved by Instagram. They will help you bid on ads and bring valuable ad content to your target audience. It’s a solid option for businesses and companies that don’t have the needed experience to run a campaign.

Types of Ads Used on Instagram

There are various advertising formats that you can choose from when running an Instagram campaign. Here are the four major types of ads that you can run on Instagram:

1. Story Ads

Story ads are the latest way for advertisers and businesses to advertise to their interested target audiences. It’s a great way for businesses to connect with their audience. After all, over 500 million Instagram users use the Instagram stories feature every day!

In fact, Instagram users are also pretty interested in looking at Insta stories of different businesses as well. You would be surprised to know that about 33% of those who watched Instagram stories belong to Instagram accounts of companies and businesses. Individuals want to actively stay up to date with the products and services of a business via its Instagram stories, which makes them the perfect place for ad placement.

Instagram story ads take up the entire screen of the user’s device. So, if someone comes across your ad story, they will have that in full display on their viewing screen. This enables your target audience to fully focus on your ad. This is also what makes these ads pretty effective for audiences. They actively engage with such ads and make sure to take a look at your services and products. Even though it’s a comparatively newer feature, it has the ultimate power to generate leads for your company or business.

2. Photo Ads

Photo ads are inarguably the most widely used form of Instagram ads. They are picture posts that appear on your target audience’s Instagram feed. These photo ads appear in a portrait or square frame. These ads are the ones that have a CTA button located toward the foot of the photo along with a sponsored tag situated at the top.

With photo ads, it’s critical that you choose the ideal photo. You want your chosen picture to gel nicely with Instagram’s aesthetics. Having a photo that resembles a stock photo will stick out negatively and might discourage people from interacting with your ad. To have an impactful photo ad, you need to choose a photo that reflects your brand image and also blends in nicely with the other Instagram posts.

3. Video Ads

Video ads are another great option for Instagram ad campaigns. These ads operate in a similar fashion to photo ads, except as the name suggests, the content is delivered to the audience through a video. These video ads can easily be up to 60 seconds longs.

Video ads are a great way to captivate your audience’s attention. When a user scrolls through their feed and comes across your video ad, the video will start playing instantaneously. However, the one drawback of video ads is that the video will start playing automatically without any sound – it’s up to the user whether they wish to turn the sound on or not.

So, when you create a video ad, you need to make sure that you don’t put the most critical part of your audio content within the first few seconds as you don’t want your audience to miss out on important information. When done right, a video ad is a great way to engage with the young demographic .

4. Carousel Ads

Carousel ads are fun and aesthetically pleasing way to interact with your target audience. They give you the opportunity to post multiple videos or photos in one post. It allows you to promote a bunch of your products and services in a single post.

For instance, if you are promoting a new line of beauty products, then showcasing just one product wouldn’t really do justice to the entire line. While it will represent your entire line of beauty products, it would not be enough to show interested parties the variety in your products.

If you use a carousel ad, you can effectively use multiple photos or videos to highlight your entire line of products. It gives you the opportunity to show your target audience variety, which entices them to engage with your ads and learn more about your offerings. It is also a great way to reach and engage with a wide target audience as one product that might not pique the interest of one individual might greatly pique the interest of another.

We hope this guide on Instagram ads has helped answer your question, “how much does it cost to advertise on Instagram?”All in all, Instagram ads are a great way to captivate the attention of your target audience. They will help your business generate leads and increase the number of conversions. You can advertise on Instagram via photos, videos, stories, and carousel ads.

If you want any help with advertising and reaching your target audiences on social media platforms, then do get in touch with SEO Resellers Canada. We have a team of social media experts ready to usher you into the lead-generating world of social media advertising! Moreover, we also provide exceptional digital marketing, SEO, content marketing, and many other services. To learn more about us, do visit our website.

author – Jamie – Barton
Jamie Barton
CEO of NASN Licensing Inc. &

Jamie has more than two decades of experience in accelerating brand visibility for online businesses. His company operates, a white label SEO and digital marketing agency. With his unique and actionable business processes, agencies and small businesses can successfully expand online operations without the traditional associated cost overhead.

For over 18 years we have been the solution to fit any size agency or business. Our team of creative SEO experts and marketers develop some of the best results driven campaigns in the industry.

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