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How Much Do Ads on Instagram Cost?

By September 15, 2015 January 18th, 2019 45 Comments

One month after Instagram opened advertising to small and mid-size agencies Penna Powers had the opportunity to launch test campaigns for both sponsored posts and videos. These campaigns tested various demographics in the non-profit/government and retail verticals. Both tests allowed us to successfully engage the designated audiences, driving website clicks, brand awareness and engagements. But most importantly, the campaigns provided Instagram advertising metrics for us to share with the world.

Storytelling is what Instagram does best, add in Facebook’s excellent targeting capabilities and your brand story can now be seen by the exact audience you’re seeking. Our campaigns set out targeting two very different audiences, teenagers (13-17) in the non-profit/government campaign and M/F (18+) in the retail campaign. The wide audience in the retail vertical was chosen to allow us to gauge a true CPM benchmark based on a large demographic segment. We were curious to see if Instagram’s estimated CPM of $13 held true or if our campaigns would come in much higher, even or much lower. Both campaign results are listed below presenting a much lower CPM in both instances by a healthy margin. The non-profit/government campaign also presented interesting data that teenagers will actively engage with Instagram content even though studies are showing a migration to other social media channels such as Snapchat. The wide audience in the retail vertical aligned with established Instagram data with the millennial audience outperforming all other segments of the target demographic. Instagram advertising is uniquely positioned to help push Facebook even further ahead of Twitter and Google in the social advertising front.

Instagram Advertising Campaign Performance:

 Campaign 1- non-profit/government- Sponsored Posts:

  • CPC: $0.14
  • CPM: $4.17*
  • CTR: 2.96%

Campaign 2 – Retail- Sponsored Posts:

  • CPC: $0.44
  • CPM: $6.58*
  • CTR: 1.47%

Campaign 2 – Retail- Sponsored Video:

  • CPV: $0.01
  • CPM: $2.48*
  • CTR: 2.08%

*Instagram estimated CPMs of $13

Instagram Advertiser Results (Instagram for Business Blog):

  • 97% lift in ad recall
  • 16-point average ad recall lift
  • 7x higher Nielsen ad recall vs. other study data

Users spend on average 5 minutes per day on Instagram and Facebook.

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We look to Facebook to begin tying in retargeting between the two ad platforms serving ads to the audience members who may have interacted with one on Facebook or Instagram presenting an opportunity for marketers to have even better data and more audience touch points. At the end of the day social media is all about engagements with the line between a website click and a comment blurring every day. The new advertising opportunity has brought about change within our own Social Media Department with the team shifting dollars almost immediately from Twitter to Instagram because of the superior ad products and the fact that Instagram blows away Twitter engagements.

Join the discussion 45 Comments

  • Has the priced increased now? I cannot find any information on the Instagram website?

  • Erick says:

    This info is awesome! My clients ask me all the time about paid advertising on social media, and particularly Instagram. Thanks for the info 🙂

  • Krisno W says:

    Nice to have real cost comparison.
    Our CPV is US$ 0.05
    Still trying to optimize it

  • Daniel says:

    What does;
    CPC
    CPM
    CTR
    CPV
    mean?

    • Nicholas Giustino says:

      Daniel,

      CPC is Cost Per Click
      CPM is Cost Per 1,000 impressions
      CTR is Click Through Rate
      CPV is Cost Per View commonly associated with videos

  • Karem says:

    On instagram, is the number of likes equivalent to the number of impressions? Or are the numbers of followers considered as equivalent to the number of impressions?
    Plus, how can we calculate our CPM, CPV, CTR and so forth?
    If anyone can help..

    • Nicholas Giustino says:

      The number of likes on an Instagram post is separate from the number of impressions. Impressions are the number of times an ad is served on Instagram. Divide the total number of impressions the ad will make by 1,000. For example, if your ad would make 10,000 impressions, you would divide 10,000 by 1,000 to get 10. This also can be said for video views. CTR is determined by (Clicks/Impressions) x 100

  • Putera says:

    Has the priced increase now? answer please

    Thanks before

    • Nicholas Giustino says:

      The CPM fluctuates depending on inventory available along with a brands vertical and sponsored content.

      • Hakim says:

        “The CPM fluctuates depending on inventory available along with a brands vertical and sponsored content”

        Could you please elaborate?

        Suppose I started 2 ads on same day, 1 for fashion outlet & 1 for medical company. Let’s say both started with a CPM of $2, however more viewers are clicking the fashion outlet ad (lets say 8 out of 10 viewers) & less viewers are clicking the Medical company ad (lets say 3 out of 10 viewers).

        Is it going to lower the speed of impressions for Medical Ad which ultimately leads me to bid higher CPM to get higher speed of impressions?

        Kindly let me know if what I think is correct.

        Thank you,

        • Nicholas Giustino says:

          What this means is, if there is a lot of competition in say the medical vertical CPM bidding will go up yielding hiring CPMs since the ad space for them is in demand. CPMs can also go up for you based on relevancy of content and score.

  • Ryan says:

    what are impressions?…………..are they like hearts and smiley faces?

    • Nicholas Giustino says:

      Impressions are the number of times your ad has been shown. Hearts and smiley faces would go under engagements or reactions.

  • Anne says:

    How do we put up a sponsored ad on Instagram? What does it cost?

  • Hameem says:

    Do you think Instagram ads can be used to get traffic for blogs on Tech, iPhone etc? Would I able to breka even if I am using adsense to monetize these blogs?

  • Lucy Kessler says:

    How long did you run these ads?

    • Nicholas Giustino says:

      Lucy thank you for the question. Our initial tests ran for 4 weeks with some campaigns varying along the way. Depending on the objective and budget of a campaign the flight dates may be longer or shorter.

  • Kelvin Agunbiade says:

    Please can i just get a step by step process in getting an ad on instagram, how much it cost and process to follow, i am realy finding it complicating to understand the flow, all i want is to get my company ads der…
    thanks

    omobakelvin1@gmail.com

  • Sagar says:

    I was thinking to try out the instagram ads, but what I see here is the cpm is $4+ and that’s pretty high!
    I want to ask, we can set the max cpc like $0.1 or so, right?

  • thanks for the information, my question is:
    do i have to make campaigns on both facebook and instagram or it can be managed so that one Ad. could be seen in both platform ?!
    thanks again

  • Thanks for the information, my question is:
    do i have to make a campaign in facebook and instagram or it could be managed so that the same ad. can be shown in both platforms, as far as i know they both are the same, sorry, this is not clear for me.
    Thanks again

    • Nicholas Giustino says:

      You have multiple choices when setting up a campaign. You’re able to setup Facebook only campaigns along with Instagram only campaigns or you can easily setup one campaign with the same creative running on both social media channels.

  • Esther says:

    How do i setup a facebook and IG campaign to run concurrently and with the same content?
    Do the costs vary or are they the same?

    • Nicholas Giustino says:

      Youll setup the campaign like you would for any Facebook campaign making sure you select the Facebook and Instagram placements. Facebook will then serve your content on all ad units across the channels.

  • Sara says:

    Please can i just get a step by step process in getting an ad on instagram, how much it cost and process to follow, i am realy finding it complicating to understand the flow, all i want is to get my company ads there…
    thanks

    selmasarra@hotmail.com

  • deanna says:

    Really keen to get our brand out there. Was wondering how much does it cost for a sponsored ad on instagram? confused on the matter

  • Richard U. says:

    This is very useful. I am glad i stumbled upon this. This goes a long way to show you how fast social media advertising is changing.

  • Laura says:

    Was this campaign over a week or a month?

  • Michael says:

    Great article, incredibly informative. When deciding to pay for an ad, are all the measurements you’ve indicated dependent upon the total lifetime budget of the ad you or do they add onto the overall cost? I’m having a little trouble trying to figure out the pricing structure works.

    • Nicholas Giustino says:

      The pricing model Instagram offers is cost per click, cost per conversion and CPM. You’ll set a budget based on the objective and then get charged for example per click utilizing your budget.

  • Edwin says:

    Please what is the cost per click and cost per view for instagram ?

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