If you’re considering advertising on social media, it’s best to know exactly what you’re getting into. Here’s how much Instagram ads cost and what factors contribute to your total spending.
How Much Do Instagram Ads Cost?
Generally, Instagram ads cost very little. However, they can easily get expensive if you begin advertising without a strategy. You see, there are no pre-set advertising tiers to choose from. Instead, the app has you input the amount you want to spend and how long you want your campaign to run.
A Breakdown of What Instagram Ads Cost
Around 92% of Instagram users take immediate action after seeing an ad. Although your chance of engagement is high, your objective ultimately determines how much you spend.
Here’s what Instagram ads cost between the same point in 2022 and 2023:
- Cost per click: The price of a user clicking on the ad or a relevant link. It was $0.93 in October 2022 but increased to $1.13 by October 2023.
- Cost per engagement: The price of user actions and reactions after they view your ad. On the app, this means things like likes, comments, saves, or shares. It was $0.04 in October 2022. In 2023, it only went up to $0.05.
- Cost per lead: The price of lead generation. You can calculate it by dividing the amount you spent by the number of leads your ad campaign created. It was $6.39 in October 2022 but went up to a staggering $26.34 by the same time in the next year.
- Cost per impression: The price of impressions. On the app, this stands for ad views. While it was $6.21 in October 2022, it increased to $9.56 within one year.
Instagram ads cost wildly varying amounts because they depend on supply and demand. After all, advertisers are the ones who technically set their own prices. The price of advertising can even fluctuate within a single month. For example, CPL rose by roughly 200% in October 2023 alone.
Why Instagram Ads Cost What They Do
Instagram ads cost very different amounts depending on several factors. While you could technically spend as little as a few dollars, your resulting campaign wouldn’t be very purpose-driven.
Here are all of the expense factors:
- Ad type: You can choose photos, videos, stories, and carousels. Also, you place your ad on people’s feeds, the store, or the Explore page. People may prefer one photo over one-minute-long videos — and engagement ultimately determines the cost.
- Total budget: You set the figure you’re willing to pay while you finalize the advertising process — the app has you select how much you want to spend each day. Even though the daily amount technically varies, you won’t go over budget.
- Target audience: You can target people with specific demographics, interests, online behaviors, or locations. Narrowing your audience can get you better results, so it costs you more.
- Campaign objective: An algorithm places ads based on your goal, so the type you choose impacts spending. For instance, views are less expensive than store visits.
- Ad duration: Naturally, the course of your ad impacts what you ultimately pay. You can either set a start and stop date or choose to keep it running continuously.
Ultimately, each of these factors determines how much Instagram ads cost. Going with a broad audience, low budget, low-level objective, and popular content type will be more affordable than the opposite. Still, success isn’t a guarantee either way.
What Should You Spend on Instagram Ads?
Although you technically only need to spend a few dollars on advertising, you’ll likely need to pour more money in to get substantial results. While the exact amount varies depending on your business type, goals, target demographic, and campaign duration, $100 should be the minimum.
Spending roughly $5-$50 may get you a few followers, clicks, and leads, but it isn’t a great value for your money. Generally, you’re better off waiting until you have a few hundred dollars to commit to a lengthy, quality campaign. That being said, running a short, affordable trial can be an effective strategy to identify gaps.
Is Advertising on Instagram Worth It?
In 2023, nearly 80% of marketers used Instagram in their marketing campaigns. Considering most people think it’s apparently valuable, you might wonder if they’re right. Since the app has 2 billion active users and a generally high advertising success rate, we’re inclined to agree.
However, there’s no guarantee of success. For example, the average Instagram engagement rate was 0.6% per post in 2022. Advertising on this app is only worth it if you know exactly what you’re doing and can be relatively sure your return on investment will be higher than the amount you spend.
Tips for Saving Money on Instagram Ads
Instagram ads cost less if you know which strategies to use. Here are some money-saving tips when it comes to advertising.
- Have Patience
The amount you spend and your ad campaign’s duration are more important than you realize. Imagine pouring $250 into advertising for either one day or one week — the chances of reaching a wider audience are much lower when you shorten their potential viewing period.
After all, user activity fluctuates depending on the season, weekday, and time of day. If you lengthen your ad’s course, you’re more likely to reach a broader user pool. Generally, you’re more likely to get results if you’re patient.
- Advertise Organically
Organic ads can be far more cost-effective than their paid counterpart. For example, 82% of Instagram users say they’re more willing to purchase from a brand that posts user-generated content. Experimenting with an all-natural approach can be beneficial to your business.
Most people already follow businesses they like, so it’s not a stretch to expect your target demographic to react positively to organic content. In fact, around 90% of Instagram users follow one or more brands. If you appeal to people with genuine, transparent product placement, you’ll likely see action in response.
- Know Your Targets
Since Instagram ads cost more if you choose more demographic details, it’s best if you understand exactly who you should advertise to. Find out who your main audience is, which group spends the most, and what content they primarily engage with.
Additionally, you should know the kinds of people you’re advertising to on the app. After all, over 60% of Instagram users are Generation Z or Millennials. If that doesn’t sound like your target audience, you might have to do more research to find out when yours is using the app. This kind of insight narrows your target demographic and ad placement choices, saving you money.
- Choose Content Wisely
Even if you know precisely which demographic to target, you must know what content they enjoy to make your ad campaign effective. For instance, reels experienced a 25% drop in engagement in 2023 alone.
Even though reels are still the leading content type on the app, they might soon become irrelevant. After all, if general interest has dipped so dramatically, users are likely much less inclined to interact with advertisements. Pay attention to engagement rates and trends.
The Value of Advertising on Instagram
Since Instagram ads cost very little if you select certain choices, it may be a valuable choice for you. After all, many small business owners only need a small uptick in engagement to jumpstart their accounts.