How much do Instagram ads cost Instagram ads are a great tool to promote your small business, but are they an expense you can afford? Find out all about the costs and the factors that affect them here. Ross Darragh April 6, 2022 6 min read About Us We are a team of writers, experimenters and researchers providing you with the best advice with zero bias or partiality. This article was authored by: Ross Darragh Writer The cost of Instagram ads varies, and in theory you could spend as little as £1 a day to advertise on the platform.However, this won’t be cost effective, as the average Instagram ad costs around £0.80–£1.10 per click. So after as little as one click, your daily ad budget would be spent.The cost increases depending on the competitiveness of the industry your business is in, rising to £2.70 per click in some cases. This is because more brands are competing on social media for engagement, which in turn bumps up advertisement costs.To limit the risk of under (or over) spending on advertising, we would recommend using a professional digital marketing agency to manage your social media marketing and Instagram advertising for you.Getting support for your business is cheaper than you might think. But, if you would like to find out exactly how much hiring a digital marketing agency would cost you, simply fill out a few details using our free cost comparison tool. It is easy to use, and there are zero obligations on your part.Or read on to learn more about how much Instagram ads cost in the UK. In this article, we'll cover: A full breakdown of Instagram ad costs in the UK What factors affect Instagram ad costs? How to set up an Instagram ad Why Instagram advertising is worth the cost Instagram ad costs vs. Facebook ad costs Next steps: should I get support setting up my Instagram ad strategy? Breakdown of Instagram ad costs in the UKInstagram ad costs can be broken up into two categories, which are entirely dependent on your bidding model. Bidding models are either cost per click (CPC) or cost per impression (CPM). What is a bidding model? Companies will bid against each other in auctions for ads on social media platforms like Instagram and Facebook. The maximum amount of money a business is willing to pay for an ad will be determined by either ad clicks or the number of impressions. This is known as a ‘bidding model’. The cost of ads on a CPC modelCost per click refers to the price you pay per click on one of your ads. This model was traditionally used on Facebook, but is now more widely implemented on Instagram.As stated earlier, cost per click ads differ in price depending on the industry your business operates in.On average, a CPC ad will cost you around £0.80–£1.10 per click. But in more competitive industries, this can rise to up to £2.70 per click.The cost of ads on a CPM modelCPM stands for cost per thousand impressions. It is the price you pay to Instagram every thousand impressions, which currently stands at an average of £7.94. It is a great benchmark to start with when you begin advertising on Instagram. What is an impression? An impression is a digital marketing term that refers to when your ad is seen by a user on social media. The user does not need to click on the ad or engage with it (like/comment) in order to count as an impression. Using a CPM model is incredibly handy when starting out your Instagram advertising campaign. This is because once you have an idea of the CPM, you can estimate the click-through rate.The click-through rate represents the number of people who see your ad and take action, whether that be by clicking on it, ‘liking' it, or commenting on it.From analysing these figures, you can work out how much a CPC ad campaign could cost you, which is incredibly useful when planning future digital marketing campaigns.Understanding bidding models and making sense of how they work isn't the most beneficial way to spend your time. By hiring a digital marketing agency to help support your Instagram ad campaign strategy, you can be confident that a team of experts will ensure your brand will reach the right audience.If you are looking to work with an agency, simply answer the question below to start the one-minute process of receiving free, no-obligation pricing information. Save by Comparing Digital Marketing Agency Costs Does Your Business Use a Digital Marketing Agency? Yes No Complete a Short Form — Receive Free Quotes — Compare & Save What factors affect Instagram ad costs?Competition – your competitors will be fighting to reach the same demographic as you. This can bump up the cost of ads because the amount a business is willing to bid for an advertisement will increase.Campaign objectives – every effective digital marketing strategy will come with objectives. The cost of your Instagram ads will depend on whether they're targeting higher or lower up the audience funnel. For example, a brand awareness campaign objective will be much lower in cost than one focused on conversions.Audience size – if you are targeting a broader audience, costs will typically be lower because there is less competition for a specific group of people. However, the more targeted you want to make your ads – with a reduced age range or specific location, for example – the more competitive the ad space will become, and this will ramp up costs.There are other factors that affect Instagram ad costs, including click-through rates and the longevity of your ad. This can all be difficult to grasp, which is why it can be really beneficial to work alongside a dedicated digital marketing agency.Want to learn more? Check out our review of the top 10 digital marketing agencies in the UK. How to set up an Instagram adInstagram ads are a form of paid social media – so unlike with organic social content, you'll actually have to pay for your ad to appear in someone else’s feed.There are a number of simple, quick ways you can set up an Instagram ad campaign, but first you need to ensure you have an Instagram business account.A business account gives you access to ad functionality, as well as user insights and post analytics.Once you have set this up, you can create an Instagram ad in the following ways.Boosting a postOnce you’ve posted organically on Instagram, you'll have the option to boost your post to reach more users. Simply navigate to your profile and select the post you want to promote, then tap the ‘boost post’ button on the bottom right.You will be directed to a pop-up menu where you can set criteria like the demographics of your audience, how much you will pay for the advertisement, and how long you want your ad to appear for. You can also add a link to the ad that takes users to your website.You can then use Instagram analytics within the app to see how your post is performing.Using Facebook Ads ManagerFacebook and Instagram are both owned by Meta, which is why users can create Instagram ads using Facebook Ads Manager.To do this, simply log into your Facebook business account, and navigate to the Ads Manager. From here, you can produce an Instagram ad from scratch by selecting the ‘Create Ad’ button, which will ask you to set the parameters of your campaign.Choose your objectives, name your campaign and define your target audience before selecting your placements, which will be Instagram ads in the news feed.Once you’ve completed the set up of your campaign, you can submit your ad for review.Sharing his top tip on setting up Instagram ads, Anil Malhotra, Chief Marketing Officer at Bango, says:“Don’t just rely on the pre-set targeting options available. These audiences are built on demographics, individual characteristics, or transient browsing habits which sound great but give little indication of who will actually buy your product – the ultimate outcome of your marketing efforts.“Marketers using social media should instead rely on custom audiences compiled using consumer purchase behaviour data — allowing your business to reach the consumers most likely to make a purchase.“It’s the distinction between targeting a vegan food ad at a person who searches for vegan keywords or fits a specific profile, and targeting the ad at someone who frequents vegan restaurants.” Why Instagram advertising is worth the costAdvanced targeting – with nearly 34 million Instagram users in the UK, the ability to be prescriptive when creating ads is instrumental to a brand's success. Being able to customise your target audience by changing options such as location, age, and even interests means you can reach the right audience.Higher engagement rates – despite engagement rates dropping across all social media platforms over the last two years, Instagram engagement is still considerably higher than other platforms, with an average rate of 0.98% per post. Compared to Facebook (0.19%) and Twitter (0.04%), this is a strong percentage.Real-time campaign performance tracking – Instagram’s analytic features allow you to monitor the success of your ads. You can track how many people have viewed and clicked on an ad link, which gives you specific insight into your campaign’s performance and helps you plan for future marketing campaigns. Instagram ad costs vs. Facebook ad costs 0 out of 0 backward forward Platform CPC Cost (Average) CPM Cost (Average) Number of monthly active users (2022)InstagramFacebook£0.80 – £1.10 per click£0.76 – £1.06 per click£7.94 per thousand£10.77 per thousand2 billion2.91 billionIt’s important to compare the advertising costs of these social media platforms because they are the two biggest available. Despite the fact you can advertise on Instagram using Facebook's Ad Manager, the costs do vary.The average CPC cost is very similar, however the CPM is much higher on Facebook than it is on Instagram. So, actioning a CPM campaign on Instagram rather than Facebook could help keep marketing overheads down.To find out more about Facebook ad costs, visit our dedicated guide. Next steps: should I get support setting up my Instagram ad strategy?Instagram ads are a great way to promote your business, brand, and products, and can be an incredibly useful tool for even new merchants to use.To recap on the average amount it would cost you to run an Instagram ad campaign:For CPC you will be paying round £0.80–£1.10 per click.For CPM you will be paying round £7.94 per thousand impressions.However, it does take considerable time and effort to run your own Instagram marketing campaign.This is why we would highly recommend you hire an expert team of digital marketing professionals that will be able to do the hard work for you, so you can sit back, relax, and watch those conversions come flooding in…To find out more about some of the best digital marketing agencies in the UK and to receive bespoke, personalised quotes for their services, simply fill out our free, easy-to-use comparison tool.There are zero obligations on your part, and the form takes under a minute to complete. Share this post facebook twitter linkedin Tags Brand-building Guides digital marketing marketing News and Features Ross Darragh Writer Ross has been writing for Startups since 2021, specialising in telephone systems, digital marketing, payroll, and sustainable business. He also runs the successful entrepreneur section of the website.Having graduated with a Masters in Journalism, Ross went on to write for Conde Nast Traveller and the NME, before moving in to the world of business journalism. Ross has been involved in startups from a young age, and has a keen eye for exciting, innovative new businesses. Follow him on his Twitter - @startupsross for helpful business tips.