How Much Do Instagram Ads Cost?

Instagram advertising has become a go-to strategy for businesses looking to drive brand awareness and conversions. But launching paid campaigns on the platform does require an ad budget. So how much do Instagram ads really cost?

In this guide, we’ll go over the factors that determine Instagram ad pricing. You’ll learn how the auction model works, typical cost benchmarks, tips to calculate and lower your costs, and how to maximize ROI.

How Much Do Instagram Ads Cost?

Instagram ad costs typically range from $0.35 to $3.00 per click (CPC) and $5 to $30 per 1,000 impressions (CPM), depending on factors like objectives, placements, targeting, and overall competition and demand. The minimum daily budget for Instagram ads is around $25 for smaller businesses and $100+ for larger brands.

Instagram ads allow businesses to promote posts, Stories, and Reels to reach new audiences and drive actions like website traffic, conversions, and app installs.

Brands turn to Instagram for its 1 billion+ active user base and strong engagement metrics like comments and likes. Instagram offers a range of ad objectives, placements, and targeting options to cater to different marketing goals.

But how much do these ads cost? Here’s a quick overview of Instagram ad pricing:

• Costs are based on an auction model
• Most ads are priced on CPM (cost per 1,000 impressions) or CPC (cost per click)
• Average CPM is $5-$10 but can vary widely
• Average CPC is $0.50-$2, depending on competition and objectives

Spend will depend on your audience, targeting, bid strategy, and optimization goals. But with the right approach, Instagram ads can cost efficiently scale your business.

According to WebFX, businesses typically pay between $0.01 and $0.25 per click, $0.01 to $4.00 per 1000 impressions, and $0.03 to $0.08 per engagement. They also report that most companies spend between $101 and $500 per month on Instagram advertising.

LinkedIn provides a slightly different range, stating that in 2025, you might expect to pay between $0.50 and $3.00 per click. They emphasize that these are averages and actual costs could be higher or lower depending on various factors.

K6 Agency reports that companies typically pay an average of $0.50 to $1 per link click, with costs potentially rising to $3.00 per click in highly competitive industries like apparel. They also mention that AdEspresso found the average cost-per-click on Instagram to be $0.80.

Gupta Media provides the most recent data, stating that as of January 2025, the average cost per thousand impressions (CPM) for Instagram ads is $8.58, the average cost per link click (CPLC) is $0.84, and the average link click-through rate (LCTR) is 1.02%. They also note that Instagram Stories Ads have an average CPM of $7.25, while Instagram Reels Ads have an average CPM of $4.29.

How Do Instagram Ad Auctions Impact Cost?

Instagram determines ad costs through a real-time bidding auction. Here’s how it works:

• Advertisers bid against each other for ad placements
• When an ad opportunity becomes available, Meta runs an auction
• The highest bidder wins and pays the second-highest bid price

This motivates advertisers to bid high enough to win auctions, but low enough to pay a reasonable price.

Factors impacting your bids:

• Your daily or lifetime budget
• How specifically you’ve targeted your audience
• Your optimization goal for conversions or traffic

Narrower targeting and lower competition allow for lower bids. Broader targeting causes more advertiser overlap and drives up pricing.

Instagram Ad Placement Options

Another factor that determines cost is where your ads appear on Instagram. The platform offers several placement options:

Instagram Feed Ads

• Appear in-between regular posts on the Instagram Feed
• Provide broad reach for brands looking to raise awareness

Instagram Stories and Reels Ads

• Placements between Stories slides or Reels videos
• Typically achieve higher engagement than feed ads

Explore and Audience Network Ads

• Appear on Instagram’s Explore page or Facebook Audience Network
• Explore specifically sees heavy competition, inflating costs

Each placement has unique pros and cons related to budget and exposure. Generally, ads on the main Instagram Feed offer the widest reach for brand awareness goals, while Stories provide more focused messaging and retention.

You’ll need to test different placements to determine which best support your main performance indicators at the most efficient CPC or CPM. Mix and match options to collect enough data on results and spend.

You might also like our articles about the cost of advertising on Facebook, Google, and Waze.

What Determines Your Instagram Advertising Costs?

You can choose automated bidding where Meta sets the ideal bid for you, or switch to manual bidding to control bids directly.

Manual bidding allows you to align spend closely with past performance data, but requires diligent optimization. Automatic bidding provides more flexibility to find the ideal range.

Audience Targeting Specificity

Targeting a very broad audience (millions of people) will increase competition and raise your average CPC. But narrower targeting (hundreds or thousands) reduces overlap for potentially lower costs.

Ad Relevance, Quality Score, and Historical Performance

Instagram grades your ad’s expected click-through rate (eCTR) based on similar past ads. Higher-quality creatives improve relevance for lower costs.

Campaign Objective and Optimization Approach

Optimizing for conversion events like purchases or app installs costs more than simply optimizing for traffic or reach. Consider end goals.

Current Demand, Seasonality, and Trending Topics

During high-demand periods around holidays or hot topics, increased competition raises costs across the board.

Average Cost Benchmarks

To set reasonable budgets, advertisers need realistic cost benchmarks. Here are current averages to expect by objective and placement:

CPC Benchmarks (Cost Per Click)

• Traffic campaigns: $0.35-$0.75
• Conversions or leads: $1.50-$4+
• App install campaigns: $2-$3
• Catalog sales: $0.75-$2

CPM Benchmarks (Cost Per 1,000 Impressions)

• Instagram Feed ads: $5-$8
• Instagram Stories ads: $10-$25
• In-stream video ads: $25-$35
• Facebook Audience Network: $1-$4

CPA Benchmarks (Cost Per Conversion)

• Mobile app installs: $2-$5
• Online retail purchase: $20-$60
• Email lead or signup: $5-$20
• Catalog sales: $15-$30

Costs range widely, but these benchmarks can set expectations when budgeting. Optimize for conversions to bring down CPA over time.

How to Calculate Your Costs

When launching a new campaign, use these steps to estimate and manage your budget:

Set Daily or Lifetime Budgets in Ads Manager

Daily budgets automatically renew each day while lifetime budgets distribute evenly over time. Start small, then scale up.

Use Meta’s Forecasting Tools

The Ads Manager forecast shows potential impression and click reach for different budgets, helping plan spend.

Review Historical Performance Data

Analyze what similar campaigns from your business or competitors achieved at certain budgets.

Test Campaigns with Limited Daily Budgets

Launch a small test campaign first to gather real cost data before investing bigger budgets.

Continually monitor costs, adjust bids, and find the optimal budget for your goals.

Lower Your Instagram Advertising Costs

Here are proven ways brands reduce their CPC, CPM, and CPA on Instagram ads:

• Improve relevance with better ad copy, creatives, and landing pages
• Refine targeting with interests, behaviors, and custom/lookalike audiences
• Split test ad variations to find higher-performing versions
• Optimize for conversions not just reach to improve campaign ROI
• Reduce bids in areas with minimal conversions to maintain budget
• Set specific time-of-day budgets to control spending during costly periods
• Pause poor-performing placements and devices to avoid wasted budget

With constant testing and optimization, you can keep Instagram ad costs under control.

Instagram vs. Other Platforms

How does Instagram advertising cost stack up against other popular digital platforms?

Instagram vs. Facebook Ads

Instagram tends to have higher CPMs but better engagement. The audience skews younger compared to Facebook as well.

Instagram vs. Google Ads

Google Ads pricing is determined by searcher intent, allowing precise targeting. But Instagram offers more visual creative options.

Instagram vs. TikTok Ads

Instagram and TikTok CPMs are now fairly comparable. TikTok can be better for viral videos. Instagram offers more mature targeting.

Evaluate each platform for your specific goals and target demographics.

Instagram Ad Strategies by Business Size

Approaches to Instagram advertising vary depending on your company’s size and resources:

Small Businesses

• Focus on low-funnel objectives like traffic and conversions
• Leverage interest-based targeting for clear audience relevance
• Create DIY ads and limit testing initially to save on production costs
• Start with daily budgets as low as $25-$50 to limit risk

Large Enterprises

• Use Instagram as part of broader cross-channel campaigns
• Develop numerous ad variations for large-scale split testing
• Target cold audiences via Facebook Pixel data and lookalike modeling
• Invest significant budgets across objectives for brand lift and direct response

Future of Instagram Advertising

Here are some projected trends that may impact Instagram ad pricing in the near future:

• Continued competition pushing CPMs incrementally higher over time
• A shift toward more spending on video ads as Reels engagement grows
• Automated optimization powered by artificial intelligence and machine learning
• Potential targeting limitations due to privacy regulation changes
• The emergence of new augmented reality and shoppable ad formats

Instagram will likely remain a cost-efficient platform, but smart advertisers will adapt strategies as the landscape evolves.

Expert Instagram Optimization Tips

To maximize your Instagram ad results and control costs, follow these pro tips:

Align Campaign Objective with Business Goals

“Choose the campaign objective that best fits your real-world goal – don’t just optimize for reach or clicks if you want conversions,” reminds Andrew Miller, Digital Marketing Strategist.

Refine Targeting Over Time

“Continuously narrow your targeting to weed out low-intent users – your CPMs will steadily decrease,” explains Lisa Chen, Social Media Director.

Audit Metrics and Eliminate Low-Performers

“Ruthlessly analyze performance and pause/remove elements that aren’t contributing to ROI,” suggests Sarah Gray, Instagram Advertising Expert.

Don’t Stray from Your Brand Voice

“Maintain your brand tone and style. Don’t get overly promotional or gimmicky,” recommends Jordan Lee, Brand Strategist.

Monitor Both Meta and Third-Party Analytics

“Leverage Meta’s data, but also implement third-party tracking for full cost transparency,” notes David Chang, Performance Marketing Analyst.

Final Words

Hopefully this guide provided a comprehensive overview of current Instagram advertising costs and how to budget appropriately. Here are some final best practices to remember:

• Monitor costs closely using both Meta’s analytics and third-party tracking
• Start campaigns with limited budgets and scale up carefully based on performance
• Adapt placements rapidly based on your ongoing cost-per-result analysis
• Refine targeting over time to eliminate low-intent users and reduce costs
• Test both creatives and audiences relentlessly using A/B split testing
• Don’t rely solely on vanity metrics – focus on real business impact

With the right optimization process, any type of business can generate an impressive ROI from Instagram ads. You simply need to align spend directly with converting audiences, place and time Instagram ads strategically, and continually refine efforts based on real data.

The platform provides extensive reach and creative options. Now put these Instagram advertising cost insights into action to make the most of your budgets.

Answers to Common Questions

Is $5 a day enough for Instagram ads?

For a small business just starting out, $5 per day can be an effective Instagram ad budget to test a limited audience. For larger reach and conversion goals, most brands need $15-$50+ per day minimum.

Is it worth it to pay for Instagram ads?

Yes, Instagram ads are worth the investment for most brands. The platform offers strong ROI across objectives when ads are well-targeted and optimized. Just focus on conversions over vanity metrics, and test small before scaling budget.

How to calculate Instagram ad cost?

Ad costs are estimated in Ads Manager based on your audience, placements, duration, and bid strategy. Refer to average industry CPC and CPM benchmarks. Start with small test budgets, then use past performance data to forecast costs when scaling up spend.