How much do Instagram ads cost? 10 ROI strategies

The first time I ran an Instagram ad, I felt like a suburban dad visiting a dispensary for the first time. No idea what anything cost, no idea who to trust, and somehow, despite watching multiple YouTube videos, I still managed to burn $150 in about 12 minutes.

If you’ve ever dipped a toe into Meta Ads Manager, you know exactly what I mean. One minute you’re adjusting your audience size, the next you’re staring at a CPM that could pay for a Labubu doll.

Whether you’re promoting a SaaS platform, a B2B consulting firm, or your company’s latest AI-powered workflow tool that definitely isn’t just a spreadsheet with a chat bubble, we’ll go over what actually affects Instagram ad costs and how to keep yourself from sobbing into your campaign dashboard with zero results and 10,000 impressions from bots in Kazakhstan.

Table of contents:

Understanding Instagram advertising costs

Instagram ads are paid promotional content that can be found throughout the platform. You’ll see them in your main feed, between Stories, in Reels, on the Explore page, and even in Shopping feeds.

Every time someone opens Instagram, an auction occurs behind the scenes. Meta looks at all the eligible ads for that user at that moment and decides which one to slot in based on this formula:

Total value = bid + estimated action rate + ad quality

• Bid: How much you’re willing to pay (per click, view, conversion, etc.)

• Estimated action rate: How likely the user is to do what you want them to do (click, buy, watch, etc.)

• Ad quality: How relevant and engaging your ad is (based on feedback, engagement history, and performance)

The system rewards quality and relevance, not just deep pockets, which is why a well-optimized $3 ad can beat a $5 ad that sucks. It’s almost as if they want you to make an effort or something. The audacity.

How much do Instagram ads cost in 2025?

The cost of Instagram ads isn’t just a number you can Google and be done with. It’s a constantly shifting variable that depends on factors ranging from how good your ad is to who you’re targeting to how many advertisers woke up and chose violence that day.

• Cost per click (CPC) is what you pay every time someone clicks on your ad. The average CPC ranges from about $0.40 to $1.25, but I’ve seen it balloon higher than $3 during peak shopping seasons.

• Cost per mille (CPM) is what you pay for every 1,000 times your ad shows up on someone’s screen, whether they care about it or not. CPM typically runs between $3 and $6.

• Cost per engagement (CPE) is dirt cheap at around $0.02 to $0.07 per like, comment, or share, which is a real bargain when you think about it. Where else can you buy human interaction for a couple pennies?

• Cost per acquisition (CPA) is wildly variable, but can range anywhere from $5 to $75+, depending on what you’re selling and how desperate people are to buy it. If you’re selling $10 socks, a $50 CPA means you’ve got bigger problems than your Instagram strategy.

• Return on ad spend (ROAS) isn’t a cost, but a performance metric. It measures how much money you make for every dollar you spend on ads. A good Instagram ROAS is around 3:1, meaning you get $3 back for every $1 you spend. Anything less than 1.5:1 and you’re basically paying Instagram to help you lose money.

Note: These vary a lot by industry. For example, an enterprise B2B software lead might cost $100+, while a fashion click might be $0.10.

Types of Instagram ads you can run

Instagram offers a variety of ad formats and placements, and each one is designed to separate you from your money in slightly different ways. Let’s break them down.

• Image ads are single, static images that show up in feeds, perfect for showcasing products that look good in still life. These ads are simple to produce and quick to launch, but they need to be eye-catching enough to knock someone out mid-scroll, or you’re basically just paying to be ignored.

• Video ads = moving pictures! Like Harry Potter newspapers, except instead of reporting wizarding news, they peddle unnecessarily gendered vitamin gummies. These can be one second to 60 minutes long, in a square or vertical format. Video grabs more attention, but only if you earn it early—hook fast, keep it mobile-optimized, and always assume sound-off by default.

• Carousel ads are swipeable ads with two to 10 cards, each with its own visual and link. They’re good for showing product variations (“7 ways to wear this ugly dress!”) or explaining a multi-step process (“Step 1: Apply serum. Step 2: Cry just a little but pretend it’s from the retinol.”). Carousel ads work well for storytelling or just trying to show off every possible angle of that tote bag you’re overcharging for.

• Stories ads are full-screen vertical ads that appear between organic Stories. They’re best for creating a sense of urgency, speaking directly to viewers, and interrupting people’s mindless tapping through their friend’s vacation pics. They’re easy to skip, so you’ve got about half a second to grab attention before someone’s thumb instinctively taps past your ad.

• Reels ads are videos that show up in the Reels feed and blend into the content users are actively watching. They can last up to 15 minutes and perform best when they look and feel like organic Reels—quick cuts, trending audio, aggressive jump cuts, and a lo-fi aesthetic. If you can create something that doesn’t scream “Hello, fellow kids!”, these can work great.

• Explore ads appear in the Explore tab (the part of Instagram where people are kinda bored but still deeply nosy). Users here are in discovery mode, not deep in their friends’ updates, so they’re more open to new brands. Use bold visuals, curiosity-driven hooks, or anything that makes someone pause and whisper “…what the heck is that?”

• Shop ads are interactive product catalogs that let users browse and buy without leaving Instagram—God forbid we have to open another app.

What influences Instagram ad costs?

Remember that formula I mentioned earlier? (The one your brain immediately forgot?) All these factors are basically influencing those components of “total value,” which determine how much you actually pay.

• Campaign objective: What you want people to do after seeing your ad dramatically affects what you pay. Awareness campaigns are cheapest because you’re asking people to simply notice you exist. Conversion-focused campaigns are the priciest since you’re trying to find people ready to pull out their credit cards. I usually start new products with awareness campaigns to build interest, then retarget that audience with conversion-focused campaigns.

• Ad placement and format: Feed and Reels ads are typically most expensive because they’re prime real estate. Stories ads often cost less per impression but may have lower click-through rates (CTR) since people skip them faster than I blow past yet another podcast ad for BetterHelp.

• Target audience demographics and size: The more specific you get with your targeting, the more you’ll pay for the privilege. Targeting “women in Manhattan ages 25-34 interested in vintage teapots and monster trucks” will have a much higher CPM than “women ages 25-45 interested in antiquing.” But that extra cost often comes with a payoff. If your ad is hyper-relevant, you’re more likely to catch someone’s eye, which means your click-through rate usually climbs right along with your CPM.

• Bidding strategy: Automatic bidding is the lowest cost and great for beginners—it lets Meta’s algorithm optimize for you. Cost cap bidding (setting a target cost per result) helps control costs if you have a target CPA. Bid cap gives you maximum control, but can limit delivery if set too low.

• Competition and seasonality: These are wild cards that can make your carefully planned budget explode like the batch of cupcakes I accidentally broiled (RIP to my smoke detector). If you’re in a hot sector like beauty, tech, or fitness, you’re going to pay more year-round because competition is fierce. During Q4, CPMs can spike 30%-50% or more as everyone ramps up advertising for the holidays. Unless you’re selling Advent calendars or New Year’s diet plans, consider pausing your campaigns during Q4 and redirecting that budget to January through March.

• Ad quality and relevance: Good ads cost less because Instagram rewards quality. If people engage with your ad, Instagram shows it more and charges you less. If your CTR is low or users hide your ad, Instagram rightfully charges a premium for inflicting it on people.

9 smart budgeting strategies to lower Instagram ad costs

I’m about to save you thousands of dollars with these strategies, so maybe name your baby after me (or at least read my other articles).

1. Reframe your audience targeting

Most people think narrowing your audience makes ads better, like only advertising commemorative Monster Jam bone china to people who really love vintage teapots and monster trucks. But that’s often wrong, which is confusing because it sounds logical.

A broad audience with really good creative can outperform your perfectly engineered audience segment. Meta’s delivery system learns faster with more data, so don’t restrict your campaign out of fear. It’s like being afraid to leave your house because it’s safer inside—technically true, but not very productive (or so I’ve been told).

2. Match objective to funnel stage

If you’re trying to optimize for purchases right off the bat with cold audiences, stop that! Use the campaign objective that actually maps to your current business goal.

Don’t default to a bottom-funnel objective because it’s the alluring option that promises to bring in sales. If your audience has never heard of you, chances are they’re not ready to convert. Optimize for a top-of-funnel objective first—it’s cheaper and actually makes sense for where they are in their customer journey with your brand.

But also don’t get too rigid about funnel theory. Sometimes, even awareness campaigns lead to conversions if your creative is really strong, your product-market fit is tight, and your offer is compelling enough.

3. Use Advantage+ placements

Advantage+ automatically allocates your budget to the lowest-cost spots that are still effective for your campaign objective. This means your ads may show up on Facebook, too, which kinda feels like cheating, but results are results.

Sometimes your ad will perform best in Stories, sometimes in-feed, sometimes in Reels—and the algorithm can figure this out way faster than you can through manual testing. Use Advantage+ to test different placements, then break out winners into their own ad sets for tighter control.

Just be sure to optimize your creative for all placements to avoid performance drops. For instance, a horizontal video looks weird in a vertical format like Stories.

4. Run ads during off-peak hours

Ad auctions are dynamic, which means competition (and cost) fluctuates by time of day. Instead of running your ads 24/7 and getting price-gouged during peak hours, try strategic timing.

Use scheduled ad delivery to limit spending to off-peak times. Test early morning (5-7 a.m.) or late-night slots (11 p.m.-2 a.m.) when fewer advertisers are active. Most businesses advertise on social media during business hours, which creates opportunities for night owls. This is the equivalent of grocery shopping at 10 p.m. on a Tuesday when there are no crowds and all the good parking spaces are empty.

Combine this with time zone targeting for maximum efficiency. For example, you can buy cheaper West Coast ad inventory during their off-peak hours (6 a.m. PST, for example) but serve it to East Coasters who are awake, active, and potentially more engaged.

Also, take a hard look at your CRM or wherever you house analytics to monitor when your audience actually converts, not just when they scroll. For example, people might browse Instagram at lunch but buy things after putting the kids to bed.

5. Run creator allowlisting campaigns

Instead of always running ads from your brand’s account, run ads through creators’ handles via branded content allowlist, which lets influencers run ads from their own accounts using your money.

These ads look more native and perform better in-feed because people trust other people more than they trust brands. Plus, creator ads often get lower CPCs and increased watch time because they don’t immediately scream “advertisement.”

Allowlist allows you to leverage the creator’s social proof and established trust with their audience. When someone with 250,000 followers posts about your product, their folks think, “Since Ashtreigh likes this, maybe I should try it.” When your business account posts the same thing, people think, “Oh, another ad trying to sell me stuff.”

If you can’t afford a big influencer, use your customer success manager, founder, or even your best customer as the face of your ads. Most of the time, raw authenticity absolutely demolishes polished brand content when it comes to performance.

6. Let creative pull more weight

Your ad is the first impression—the better (and more engaging) your creative, the cheaper it is to shove into people’s eyeballs.

Don’t put all your eggs in one creative basket. Rotate multiple visuals for each product or offer. Test different angles—emotional, logical, funny, slightly unhinged. What resonates with one person might bore another, and having multiple creative angles means you can reach different personality types.

If your Reel starts with “Hi guys!” or a millennial pause, you already lost. Capture attention with a dramatic hook, weird confession, or an irresistible tip that people can immediately weaponize in a group chat. The first three seconds determine whether someone watches or keeps scrolling, so make them count.

Finally, don’t sleep on user-generated content (UGC). That slightly out-of-focus video of Brittany in her car talking about how your shampoo changed her life might look like it was filmed on a potato, but it’s more real and relatable than a thousand-dollar photoshoot with perfect lighting and a model who’s never used your product. People often just want to see someone like them, with a weird patch of eczema and a Kohl’s Card, getting real results.

7. Use cost caps strategically

For accounts with volatility (which is literally every account I’ve ever managed), test bid or cost caps to prevent the algorithm from setting your entire ad budget on fire.

Apply cost caps to control CPA without throttling volume. Set a max allowable CPA, and Instagram will try to get you results at or below that cost. It’s like sending your friend to haggle at a flea market because you’re bad at confrontation and also can’t mentally calculate percentages.

But aggressive caps too early can throttle delivery. Start with highest-volume bidding to learn your baseline CPAs, then add caps once you understand what’s realistic. I typically run ads for a week with no caps, see where they settle, then set a cost cap around 20% below that average to gently push the algorithm to find efficiencies.

8. Build a lead magnet bridge

If your purchase CPAs are brutal, try not scaring people off right away with a lead magnet. Create a valuable free resource that solves small problems for your target audience and use a low-cost, non-threatening lead gen campaign to warm them up.

For example, a fitness coach could offer a free workout guide, a business consultant might provide a template for project planning, or an astrologer could create a “what your birth chart says about your toxic traits” quiz.

Once you’ve got their info, you can:

• Woo them with drip sequences and retargeting ads that nudge them toward conversion.

• Create lookalike audiences so Instagram helps find more people like the ones who already like you.

• Stop relying on one platform to hold your entire business hostage.

Speaking of, a lead magnet also protects you from platform changes. If Instagram decided to ban you tomorrow for posting one too many thirst traps in your Stories, you’d still have all those leads safely in your email list.

9. Optimize landing page speed

Your ad might be perfect, but a slow landing page is the Grim Reaper of conversions and tanks your quality score. So treat page speed like a neurotic Victorian treats fainting couches—maniacally obsess over it while ignoring your children and emotional wounds.

Use a tool like Google PageSpeed Insights to detect bottlenecks. It’s a free tool that tells you what’s slowing down your website and gives you a score out of 100. Test every landing page and aim for scores above 90. Anything below 80 needs immediate attention.

Use mobile-first layouts (since almost all Instagram traffic comes from phones), eliminate unnecessary redirects that slow load times, and compress your images—no one needs a 5MB JPEG of dropshipped baby clothes.

Faster load times lead to higher conversion rates and quality scores. In my experience, shaving just one second off landing page load time increases conversion rates by nearly 20%. Instagram’s algorithm notices this and rewards faster pages with lower ad costs.

Consider using Instant Experiences for native, fast-loading mobile formats. These full-screen experiences load instantly within Instagram, eliminating the delay of opening an external browser. For lead generation and product showcases, they often outperform traditional landing pages.

10. Maximize ROI by orchestrating your Instagram ads

After you’ve implemented the strategies above to lower your Instagram ads costs, it’s time to level up with automation. Because manual ad management is like explaining Ethereum gas fees to your grandparents—technically possible, but a completely unnecessary form of self-torture.

With Zapier, you can orchestrate your entire Instagram ad ecosystem by connecting it with thousands of other tools and use AI-driven workflows to automate every step of your funnel—from repurposing top-performing content across channels to scoring and syncing new leads to your CRM.

Learn more about Instagram automation, or get started with one of these pre-made workflows.

Instagram ads cost FAQ

People ask lots of questions about Instagram advertising costs. Here are the most common ones, answered in a way that (hopefully) makes sense.

How do Instagram ads work?

Instagram ads work through Meta’s advertising platform, using an auction system that considers three main factors: your bid, the estimated action rate (how likely users are to take your desired action), and ad quality.

Technically, you’re competing against other advertisers for ad space every time a user opens Instagram. But instead of just the highest bidder winning, the advertiser with the highest “total value” (that formula I mentioned earlier) gets shown.

How much does it cost to advertise on Instagram?

This is like asking “how much does food cost?” It depends on what you’re buying and where you’re shopping. You can advertise on Instagram with as little as $1 per day, which will get you some results but probably not enough to quit your day job.

Most small businesses spend somewhere between $100-$500 per month on Instagram ads, while larger companies might spend thousands or tens of thousands. The actual cost depends on your industry, audience, ad quality, and whether you’re advertising during peak competition seasons when everyone else is also trying to get attention.

Are paid Instagram ads worth it?

For most businesses, yes, Instagram ads are worth it if you know what you’re doing. The platform has over 2 billion active users, which makes it a powerful tool for reaching potential customers. The key is having realistic expectations and understanding that advertising is a skill that takes time to develop. You’re not going to launch one campaign and suddenly become the next Addison Rae, but you can definitely use ads on Instagram to grow your business if you’re willing to learn, test, and optimize.

What is the minimum spend on Instagram ads?

Instagram doesn’t have a minimum spend, but Meta suggests spending at least $5 per day. This makes it accessible for pretty much anyone to try, which is great news if you’re bootstrapping a business or just curious about how advertising works.

However, spending the minimum suggested amount isn’t going to get you meaningful results because the algorithm needs data to optimize your campaigns, and data costs money. Most experts recommend spending at least $5-$10 per day per ad set to give the system enough information to work with.

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