E-commerce Marketing
People don’t just scroll Instagram for fun anymore; they use it to shop and explore new offerings. In fact, 62.3% of adult users research products and brands on the platform, more than on Facebook or TikTok. With Instagram ads, you can reach these high-intent users through precise targeting and turn their curiosity into awareness, engagement, and sales.
This guide will show you step by step how to launch your first campaign and reach the people already looking for products or services like yours.
- Why Advertise on Instagram?
- How Instagram Ads Work
- Getting Started: Setting Up Your Account
- Two Ways to Create Instagram Ads
- Step-by-Step Guide to Creating Instagram Ads With Ads Manager
- How Much Does Instagram Advertising Cost?
- Tracking and Measuring Performance
- Pro Tips for Successful Instagram Ads
- Common Mistakes to Avoid
- Wrapping Up
Why Advertise on Instagram?
As the third most popular social media platform, Instagram draws in over 2 billion active users each month. The largest Instagram advertising audiences are India, United States, Brazil, Indonesia, and Turkey:
Top Instagram ad audiences
Instagram appeals especially to younger demographics: almost 32% of the app’s global audience is aged 25–34, while 29.5% is between 18–24.
Global Instagram audience by age
Income data shows another big advantage for advertisers: Instagram draws people with strong spending power. 54% of the users earn $70,000–$99,999, and nearly six in ten make more than $100,000 a year.
What sets Instagram apart is the level of user engagement. Here are some of the average Instagram engagement rates:
- All post types: 0.49%
- Photo posts: 0.44%
- Video posts: 0.47%
- Carousel posts: 0.64%
At first glance, these rates look small, but if we compare them to other platforms, they’re actually strong. Facebook averages about 0.15%, while X engagement is closer to just 0.015%.
Relying only on organic reach might feel like the cheaper option, but it has its limits. Growing a following takes time, and changing algorithms can make results uncertain. That’s why mixing organic posts with paid ads is the best strategy. Organic content keeps your audience engaged, while Instagram ads help you get discovered by people who haven’t met your brand yet.
How Instagram Ads Work
Instagram promotions look and feel like native content, which makes them less disruptive and more effective. You can show ads in different places across the platform: in the feed alongside regular posts, in full-screen Stories, and as short videos in Reels. They also appear in Explore, the platform’s hub for trending posts and new content.
Instagram ads
Instagram gives you plenty of ad formats to work with. A single image is great for showing off a product, video helps you tell a story, carousels let people swipe through multiple visuals, and collections make it easy to browse and shop without leaving the app.
Instagram Shopping ads highlight products with tags linked to a brand’s catalog. When users tap, they’re taken to a product detail page inside Instagram, where they can learn more and complete the purchase either within Instagram or on the brand’s mobile site.
Targeting on Instagram goes beyond simple age or gender filters — you can also factor in purchase habits and lifestyle interests, then create a lookalike audience to expand reach. This precision reduces waste and increases the chances of real engagement.
Getting Started: Setting Up Your Account
The first step is switching to a business account, which unlocks analytics, advertising tools, and shopping features. If you already use a personal profile, you can convert it in just a few clicks through your account settings:
Next, connect your Instagram to your Facebook account by choosing the business page you want to link. If you don’t have a page, you can quickly set one up during the process.
It’s possible to run ads from an empty profile, but sending users to a blank page can hurt trust and turn them away. To make a strong impression, set up the basics first — a clear profile picture, your business name, and a short bio that explains who you are. Just as important, publish a few introductory posts that showcase your products or services so visitors immediately see what your business is about. These posts act as proof of credibility and give users a reason to stay and explore.
Two Ways to Create Instagram Ads
There are two ways to run ads on Instagram. You can either use Facebook Ads Manager, which provides advanced options such as retargeting, dynamic creative ads, and robust analytics, or you can promote existing posts directly in the Instagram app. It’s quick, easy, and perfect if you just want to get started, though it doesn’t come with all the advanced features.
Next, we’ll guide you through setting up your first campaign in Facebook Ads Manager.
Step-by-Step Guide to Creating Instagram Ads With Ads Manager
1. Open Ads Manager and click 'Create' to begin.
2. Next, choose your campaign objective. Before selecting an objective, be clear about the outcome you want. The algorithm tailors delivery to your choice — for example, if you select 'Engagement', your ad will be shown to people most likely to like, comment, or share.
3. Set clear, descriptive names for your campaigns, ad sets, and individual ads. A good naming system makes it much easier to stay organized and quickly find what you need later.
4. Choose the performance goal. A performance goal is the outcome your campaign is optimized to achieve in the ad auction.
5. Set your budget. A daily budget is the average amount you’ll spend each day, while a lifetime budget is the total you’ll spend over the entire duration of the ad set.
6. If you have a specific audience, you can add it in the Audience controls section.
7. Now is the time to create your first ad. In the Identity section, select the page you are going to run your ads from.
8. In Ad setup, select 'Create ad' and then choose the format that best fits your campaign.
9. To make your ads appear only on Instagram, go back to the Ad Set level and select Instagram as the sole placement.
10. Add your creative and choose the destination where people will be directed.
11. Set up tracking and conversion events to measure how your ads perform. When everything is set, click 'Publish' to submit your ad for review.
How Much Does Instagram Advertising Cost?
Instagram ads operate on a bidding model, so your costs depend on your objective, business type, and competition. CPC on the platform averages $0.40–$0.70, but for ads with a destination URL it ranges from $0.50 to $0.95. CPM, or cost per 1,000 impressions, usually falls between $2.50 and $3.50 for a strong campaign.
Tracking and Measuring Performance
Measuring performance is what helps you improve your ad campaign and get the most from your budget.
The most common metrics include impressions, which indicate the number of times your ad was displayed, and clicks, which track user interaction with links or calls to action. Conversions show the number of users completing the desired action, such as a purchase or sign-up. Engagement rate reflects how users respond through likes, comments, and shares, while ROAS shows the revenue generated compared to what you invested.
To check your ad performance, open Ads Manager, select the campaign name, and click 'Charts'.
Pro Tips for Successful Instagram Ads
Launching your first Instagram ad campaign can feel overwhelming, so here are some simple tips to help you succeed:
- Keep creatives native to Instagram. Ads that look too “advertisement-like” often get skipped.
- Use strong visuals. High-quality images and short, attention-grabbing videos perform best.
- Add clear CTAs. Guide users with direct calls to action like Shop Now, Learn More, or Sign Up.
- Test creatives. Run A/B tests with different images, videos, and copy to see what resonates with your audience.
- Optimize for sound-off. Since many users scroll through their feed without sound, adding subtitles helps your video ads deliver the message clearly.
- Use Instagram Shopping features. Build a catalog of your products that people can browse and shop without leaving Instagram.
Stick to these basics, and you’ll build ads that grab attention, earn trust, and encourage action.
Common Mistakes to Avoid
A common mistake is targeting too broadly. Sure, you might get more impressions, but most of them won’t come from people who actually care about your business. It’s better to narrow your audience by focusing on demographics, interests, and behaviors. You can also use lookalike audiences to find new people who share traits with your best customers.
Another mistake is running ads from an empty profile. When users click through and land on a blank page, it damages trust and can even look suspicious. A complete profile with a bio, profile picture, and a few posts builds credibility and keeps visitors engaged.
Without reviewing performance data, it’s impossible to know what’s working and what needs improvement. Regularly check key metrics in Ads Manager to adjust the campaign and get better results.
Finally, avoid using the same creative across all placements. What works in the feed may not perform in Stories or Reels. Tailor your visuals and copy to each format to maximize impact and create a smoother user experience.
Wrapping Up
Instagram ads help you connect with a new, highly active audience and grow your business opportunities. You don’t need a large budget to see success; the key is testing, learning, and optimizing. Begin your first campaign today and turn Instagram into a growth channel for your brand.
