How Much Do Instagram Ads Cost In October 2024? Latest Data + Tips To Reduce
How much do Instagram ads cost? If you are mapping out to advertise on Instagram, you may be urged to know the answer. In this article, find the latest data on the price of advertising on Instagram and tips to lower it without sacrificing your advertising results.
How Much Do Instagram Ads Cost In October 2024?
Instagram may bill your ads based on different ad metrics, depending on the bidding strategy you select for your campaign.
The most common ones are cost per click (CPC), cost per mile (CPM), and cost per action (CPA).
CPA is a broad term, which can be classified in various ways based on your desired action. In this article, we will look at three common classifications: cost per engagement (CPE), cost per lead (CPL), and cost per install (CPI)
So, how much is an Instagram ad in October 2024? Here’s a snapshot of current Ig costs in the United States, according to Bïrch:
- Instagram ads cost approximately $1.17 per click.
- Instagram ads cost approximately $10.86 per 1.000 impressions.
- The cost per engagement for Instagram ads hovers around $0.058.
- Advertising on Instagram costs approximately $14.86 per lead.
- Instagram ads cost around $3.64 per mobile app install.
It’s worth emphasizing that seasonality, competition, country, ad quality, and many other factors can affect the final cost of your ads. Data from our own campaigns running in the Philippines is much lower than that. For example, our average CPC is $0.3, and our CPM is $4–5$.
Instagram Ad Average Cost Per Click (CPC)
The average CPC for Instagram ads in the US in October 2024 is $1.17.
It means that each time a person clicks on your ad, you may have to pay approximately $1.1-$1.2.
Instagram Ad Average Cost Per 1000 Impressions (CPM)
The average CPM in the US in October 2024 is $10.86.
This is the amount you pay for every 1000 times your ad is displayed.
Instagram Ad Average Cost Per Engagement (CPE)
The average CPE for Instagram ads in the US in October 2024 is $0.058.
These engagements include reactions, comments, shares, clicks to profiles (which impact the cost per profile visit on Instagram), link clicks, and clicks on media.
Instagram Ad Average Cost Per Lead (CPL)
The average CPL in October 2024 is $14.86.
This is the amount businesses have to pay to capture a lead from their Instagram ads.
Instagram Ad Average Cost Per Install (CPI)
The average CPI in October 2024 is $3.64.
This is the average cost for a mobile app installation from Instagram ads.
Now you’ve known the answer to How much does it cost to run ads on Instagram. The thing is, Instagram ads seem quite expensive for the US market now, right? But don’t despair, just take them as benchmarks, not the final numbers. You can reduce the cost of your Instagram ads, like what we do at GDT Agency. Keep scrolling for the most practical tips from our advertising experts!
How Does Instagram Ad Pricing Work?
Before jumping to tips to reduce Instagram ad costs, you should understand how they work.
Meta says you can run ads on Instagram on any budget, even less than a cup of coffee each day. This statement is partly true, but it doesn’t tell the whole picture.
While advertisers can decide how much they want to spend on Instagram ads each day, the exact cost to get your ads shown to a target audience is determined in ad auctions, where you have to compete against other advertisers.
To win the auctions, you must have the highest total value, which is determined by 3 major factors:
Formula: Total Value = Bid x Estimated Action Rates + Ad Quality
- Bid: The maximum amount you are willing to pay to show your ad to Instagram users. You may pay less than this amount.
- Estimated Action Rates: An estimate calculated based on Meta’s machine learning algorithms to predict how likely a person will take a desired action from your ad.
- Ad Quality: A measure of the quality of ad creatives, including images, videos, texts, landing pages, etc. It’s calculated from various sources including user feedback and assessments of the review system.
It can be concluded from this formula that if you are running Instagram ads on a fixed budget, then the best way to maximize your campaign results is by improving estimated action rates and ad quality.
Apart from bid amount, estimated action rates, and ad quality, there are additional factors that partly determine your advertising costs on Instagram.
Let’s learn what they are.
What Factors Influence Instagram Advertising Costs?
When talking about Instagram advertising costs, there are 6 impact factors you should be aware of.
Bidding Strategy
There are 3 types of bidding on Instagram ads:
- Spend-based bidding: When you choose this strategy, you let Instagram’s algorithm automatically spend your budget to get the highest results or value. This option maximizes spending of the allocated budget.
- Goal-based bidding: You set a desired cost per result or ROAS to ensure the advertising cost won’t eat up your profit, and let Instagram bid dynamically based on your goal. This strategy helps optimize ad spend when scaling.
- Manual bidding: This option gives you more control over the maximum bid across auctions. It’s suitable for experienced advertisers who can calculate the right bid and help you optimize your profit.
Choose the right bidding strategy based on your experience and needs.
Estimated Action Rates
Usually based on historical data like what a person tends to engage with or the engagement rates of your previous ads.
So when somebody sees your ads, are they likely to respond positively when they see it again? Do they remember your brand name? Are they commenting, liking, sharing, and engaging with your ads? Are they clicking on your profile, on the See More button, starting or stopping videos, or clicking on your ads? What is the view rate and view time of your video ads?
Those things affect the estimated action rates. When your ads receive higher estimated action rates, they will have higher total value and more chances to win auctions.
Ad Quality
Instagram encourages high-quality, relevant ads to improve user experience. Thus, higher ad quality means higher total value and lower costs.
Timing and Seasonality
The time of the day and season of the year also impact the advertising costs on Instagram.
It’s usually because of the higher competition during peak times such as Black Friday, Christmas, and New Year’s Eve when many advertisers try to reach the same audience, leading to a bidding war.
Businesses will have to raise their bid account to win the auction against competitors, which means higher costs.
Targeting
Specific targeting and a narrow audience can cause higher costs because of increased competition. Also, data show that targeting females often costs more than males because women are more likely to take desired actions.
Country and Industry
Instagram advertising costs also vary by industry and country. Those with more competitiveness often experience higher ad costs and vice versa.
For example, B2B Instagram ads are often more expensive due to less presence of businesses on Instagram.
>>> Related Article: Don’t Miss Out On 12 Benefits Of Advertising On Instagram In 2024
How Can I Optimize My Instagram Advertising Costs?
From years of experience in advertising on Instagram and other digital platforms, I’ve concluded some tips to optimize advertising costs, which I’m going to share with you below.
Choose the right bidding strategy
For beginners with little previous data, I suggest the highest volume bidding strategy, also known as automatic bidding, to let Instagram’s algorithm determine the most cost-effective bid for your campaign.
If you have collected some data, you can use cost-cap bidding strategies for more control over advertising costs.
Target the right audience
Targeting the wrong audience can significantly increase the advertising cost and reduce ad performance. Make sure you choose suitable audiences for your products/services. For example, if you sell workwear, you should not target students or retirees.
Set the right campaign objective
Different campaign objectives (like awareness, engagement, and sales) correspond to different sales funnel and desired actions. Based on the selected objective, Instagram will deliver ads to people who are most likely to take corresponding action.
So if you want to get more sales but select engagement as the objective, you may get many views, likes, and comments but no sales, which wastes your budget and reduces your ROAS.
Thus, make sure you select the right campaign objective for your Instagram ads to make the most out of your ad spend.
Compelling creative
To improve the estimated action rates and ad quality, you must craft high-quality and engaging content.
As Instagram is a visual-focused platform, you should leverage visual content like short clips, carousels, and images to captivate more eyeballs.
Learn how to make effective hooks, attractive designs, engaging ad copy, and compelling CTAs to naturally boost performance and reduce costs.
Landing page relevance
If your ad creative is engaging but your landing page doesn’t align with it, people will leave after clicking on the ad.
For example, if you are promoting a boot collection, your link should direct users to the product page instead of your homepage.
A/B Testing
Try different ad creatives, targeting options, and bidding strategies to find the winning ads for your products/services and optimize your ad spend.
Analytics
Regularly track ad metrics using Instagram’s analytics tools to analyze key metrics like CPC, CPI, CPLPV, CPA, and ROAS. Identify areas for improvement, like your ad content, audience, and landing page.
Make necessary adjustments to optimize your campaigns and find winning ads.
Tip: Rent Facebook agency accounts to optimize CPA for your Instagram and Facebook ads.
Bonus: Instagram Ads Cost Calculator
Use this free Instagram advertising cost calculator to estimate the cost of advertising on Instagram.
You can customize it based on your business goal.
Free Instagram Ad Cost Calculator
Closing
In short, there is no one-size-fits-all answer to the question: How much do Instagram ads cost? It depends on multiple factors from the bidding strategy to the ad creative you use. By understanding the mechanism of Instagram ads and constantly learning the skills to make them work, you can drive great results for your business.
Follow our blog for more advertising knowledge and expert insights. Happy advertising!
Was this helpful?
You can contact us, with our experience in successfully deploying thousands of conversion advertising campaigns, GDT Agency confidently believes we can help you optimize effectiveness and maximize cost savings with advertising operations.