Running Ads on Instagram: Everything you need to know!

Instagram is easily one of the most profitable platforms currently on the web. With a continuous rollout of exciting features, marketers have a lot more creative space on Instagram, helping them gain a competitive edge.  

As an example, a recent Instagram update allows you to add credit card in order to make in-app purchases – without even needing to close the application. This update is a boon to marketers running ads here, and looking for quality leads and conversions.

As of June 2018, Instagram hit 1Bn monthly users, an improvement from 800M in September of the previous year.

That’s a lot of traffic. But do you know what else does that mean? Lots and lots of competition.

How to make sure you cut through all this noise and reach your audience? By designing targeted and appealing ads.

Instagram uses Facebook’s advertising system which is very comprehensive and powerful. Never before could we target people based on their age, interests, and behaviors to such specificity. Keeping this in mind, this guide is going to be quite extensive!

To help make reading this guide easier, we have divided the guide into five short, digestible chapters.

Feel free to read it from top to bottom (thank you!) or skip to your favorite section with the quick links:

Why use Instagram ads?

Ever since Instagram launched advertising back in 2015, their ads have driven more than a billion user actions. And just last year, the advertiser banner more than doubled to 500,000 advertisers.

Strata conducted a survey in 2017 that revealed 73% of ad agencies based out of US planned on using Instagram ads for their clients. This is a massive leap from the 43 percent the year before.

But this massive popularity cannot come without a reason. Let’s look at some reasons in support of the popularity of Instagram ads:

  1. Audience growth: Like we said earlier, Instagram has a 1bn+ user base. It is one of the fastest growing social media platforms. TrackMaven studied 46,965 brands across all domains and resulted that brands saw a 100% median follower growth after using Instagram ads.
  2. Attention: On an average, users spend 50 minutes a day on Facebook, Instagram, and Messenger. In the U.S., one in five minutes is spent browsing Facebook or Instagram. What that means for you, is that your audience is already pretty attentive on the platform. All you need to do is advertise efficiently.
  3. Intent: A study by Instagram suggests that more than 60% of Instagram users say that they learn about a lot of products and services using Instagram. And 75% say that they even take actions such as visiting sites, browsing, or telling a friend about a relevant advertisement seen on Instagram.
  4. Targeting: Instagram ads use Facebook’s advertising system, which has by far the most powerful targeting ability. It allows you to target your audience’s location, behaviour, demographics, interests, and more. You can even target people who’ve earlier interacted with you or others like you.
  5. Results: According to Instagram, a study of more than 400 campaigns globally revealed that the ad recall from Instagram ads was at least 2.8 times higher than Nielsen’s norms for online advertising.

Are Instagram ads for you?

Most likely, yes.

Instagram ads are incredibly useful, but before you take a deeper dive, there are several factors for you to keep in mind:

  1. Demographics: Find out whether or not your target audience is on instagram. According to studies, as of December 2017, the largest Instagram user group was between ages 18 to 34. Pew Research Center found that in the U.S., female (38%) are more likely to use Instagram than male (26%).  While the study was only conducted on Americans, the similar patterns can be expected to occur globally.
  2. Topics: Does your target audience talk about the product/service/industry of your offering on social media? Facebook surveyed 11,000 young adults (13 to 24) across 13 markets and discovered that some of the most popular topics on Instagram include:
  • Fashion/Beauty
  • Food
  • TV/Films
  • Hobbies
  • Music

This, by no means, is an exhaustive list, but it does give you a fair bit of idea on what to expect before diving into Instagram ads.

  1. Visual storytelling: Do you think you can create visual content that blends neatly into your target audience’s Instagram feed?

According to the same Facebook study, “Instagrammers appreciate aesthetic quality in visual content”. Instagram has always been a visual-first platform, where visual content is always the primary form of communication.

If after all this, you feel that Instagram ads are indeed what your brand needs, here are some types of Instagram ads.

Types of Instagram ads

Primarily, there are five types of ads you can run on Instagram – which cover both your feed and stories. Let’s look at them in detail:

Photo Ads: Similar to a normal post, your ad will appear as a single picture on your user’s feed. These ads allow e-commerce to communicate with their target in a visual format.

the-mindy-project-on-huluSource

For example, Hulu’s ad targeted the Mindy Project – a famous sitcom.

Video Ads: If you have more to say than a single photo would convey, video ads are for you. Instagram allows you video ads up to 60 seconds.

A good source of inspiration here would be how Victorinox promoted their I.N.O.X.V watches using Instagram video ads targeted to showcase the watches’ design. This video ad reached more than 10Mn people and was sure a hit.

Carousel Ads: This is another way you can display longer ads. With carousels, you can create ads worth more than two scrollable images or videos.

instagram-carousel-adsSource

Fizzy Goblet, a footwear company, ran carousel-based ads targeting existing customers and also reaching new markets. This resulted in increased sales by 50% and website traffic by 40%.

Slideshow Ads: Slideshow ads can be understood as a hybrid between carousel and video ads.

Slideshows allow you to incorporate up to 10 photos that automatically roll as a video. This can help people with poorer connection speed for a video.

For instance, Stance – an American sock brand used slideshow ads to hook their target audience. Because they lacked the luxury of time and money required to shoot a video, they used their existing still products image to build a slideshow. This increased their return on ad spending by 1.5 times.

Stories Ads:  Instagram Stories is a fullscreen and immersive experience for viewers. You can run both photo and videos on your Stories ads.

stories-ads-on-instagramSource

Young and Reckless, a lifestyle brand added animated texts to its photos to create animated GIFs. Then, they ran this as their stories. This clever way to advertise helped them achieve a 6x return on investments.

Now comes the important question – how much do the ads cost?

Average Instagram ads cost

Before we get too deep into discussing the costs of Instagram ads, it’s important to note that Instagram ads are NOT Facebook ads.

Comparing them is pretty much like comparing apples and oranges – especially when you talk about Instagram engagement. Instagram typically sees more than 10 times the engagement seen by Facebook on an advertisement – implying a much higher chance at converting the user into a customer.

Because of this reason, Instagram ads also tend to cost slightly higher than Facebook ads – even for the same target audience.

instagram-ad-cost

This has a lot to do with the nature of the platform as well as how accustomed users have gotten to seeing and ignoring ads on Facebook and other sites.

In any case, the average cost per click on Instagram is around $.70 (about $0.35 on Facebook). CPCs are also generally higher for the audiences in the 18-24, 25-34, and 35-44 brackets.

Pro-Tip: These costs might be a notch higher if you’re looking to target female users or Apple users.

But the cost isn’t so straightforward, either.

Five tips for determining your Instagram ad cost

Obviously, the final costs are going to vary based on a lot of factors include who are you targeting, but there are definitely some ways you can ensure a much more effective campaign, and consequently better ROIs, no matter what your subject of advertising may be.

First, keep it natural.

At its core, Instagram is a photo-sharing social media app. It’s mean to offer real, authentic glimpse into the lives of others, including friends, family, celebs, and even brands that they care about.

Keeping this in mind, DO NOT overproduce your posts and make them look on-the-face-advertorial. Keep them candid, fresh, and real – so that it resonates with your user. A minimal, candid ad is what will appear the most native, too. So much so that many won’t even notice that it’s a paid ad!

Pro-Tip: While advertising using Instagram stories, make sure you’re “thoughtful” enough, because people are pretty much in a “browsing friends and family content” frame of mind.

Utilize videos, carousels, and slideshows.

Get the most bang for your buck by making use of videos, carousels, and slideshows. Like we said earlier, these features help you use more images, thereby increasing the amount of content you’re displaying. Further, these are a lot more interactive and engaging than simple photo adverts, and tend to stand out from other posts in the feed.

instagram-ad-costSource: Marketing Week

Get detailed with your targeting (and messaging).

Like Facebook, Instagram, too, lets you drill deep into the age, gender, relationship status, geographic location, and lots more. So, you can target the most qualified and ready-to-buy-in audience for yourself. Just make sure you create the content that resonates with your audience.

When users do click on your ads, ensure you’re driving them towards landing pages – preferably ones with some sort of lead capturing form, or easy navigation to help them purchase quickly.

This allows you to:

1) Provide your audience with the content that precisely meets their needs, and

2) Places them in your funnel so that you can easily reach out to them at a later date, in order to re-target.

instagram-remarketing

Watch your relevance score.

According to Facebook, “your relevance score estimates how well your ad is resonating with your target audience. The higher your ad’s relevance value, the better it is performing”.

This score tells you how relevant the content is. If you get a poor relevance score (example: 1-3) before you go live, you might want to re-think things, as it probably won’t justify budget very efficiently.

Consider drilling down deeper on your targeting or tweaking your creative so the two are in better alignment.

Test & test.

As with every other marketing strategy, you’d want to test, measure, and improvise based on your analysis. If you’re not getting the ROI you wanted, or even worse, it’s even worse than your Facebook ad’s performance, you might want to take a step back and realign.

You can also supplement your Instagram ads using influencer marketing on the platform. A combination of both offers one-two punch of modern marketing prowess that can not only help raise awareness, but also build a following, and convert more sales.

Wrapping up

Instagram is one of the largest social media platforms out there, which means that the opportunities for reaching out to your audience are endless. It’s even bigger than Twitter, and so much so that even the biggest brands you’d imagine are putting lots of efforts into effective Instagram marketing.

And that means you should, too.

To get started, just decide which ad format works best for you and your offerings. Run a few ads to decide which format works best for the content you have. Don’t forget to add lead capture forms to these ads, in order to get more information on the audience you’re trying to reach.

The cost for each type of Instagram ad is completely customizable, so you’ll never go over-budget. Just keep your targets well defined, select ad placements, and choose a schedule and a budget that works best for your business.

It is really as simple as that!

And if you don’t believe us, come to us – we’ll prove you wrong!