14 min. read
Instagram advertising is massive right now. But just how popular is it?
Instagram’s revenue from mobile ads alone is set to hit over 6.8 billion dollars in 2018. That’s billion with a “b”.
Ads on Instagram generate that kind of revenue because they’ve got over 2 million monthly active advertisers right now. Wow.
…now that’s a lot of ads.
So what’s driving all this Instagram-mania?
Well, the stylish, visually-focused nature of the platform makes it a paradise for brands, from fashion companies highlighting stunning new collections of handbags to travel agencies showing off pristine beaches in the Caribbean.
After all, Instagram users actively seek out brands that deliver amazing visual experiences on the platform.
Sound too good to be true? Well, the proof is in the data.
80% of all Instagram users follow at least one brand, 60% of users discover new products on the platform, and over 200 million visit at least one business profile per day.
Put all that together, and you have an online audience that’s not just ready to engage with brands on Instagram…it’s actively seeking them out.
That’s why it’s more important than ever to run great Instagram ad campaigns in 2018. The opportunity is there, you just need to grab it.
We’re breaking down five tips for running the perfect Instagram ad campaign, using some of the powerful insights from our recent hit webinar, The Anatomy of a Successful Instagram Ad Campaign.
Here’s what you need to do to run ad campaigns that get results:
And for even more Instagram inspiration (Instapiration?), try these 21 Tips to Massively Increase Instagram Engagement.
1. Selecting the ideal Instagram advertising objective
Obviously, if you want to run a great Instagram ad campaign, you need to think about why you’re doing it first. But we want to offer some more practical advice than that.
Here’s how to decide which specific Facebook Ads Manager objective you should be using for your next Instagram ad campaign.
These are your options when it comes to advertising on Instagram. All nine objectives fall into one of three categories: awareness, consideration, or conversions.
When should you select an awareness-based objective? When you want Instagram users to see and remember your brand.
If your aim is to get your ad in front of as many eyes as possible, you should shoot for Reach. However, we don’t necessarily recommend this objective in general.
If your overall goal with advertising on Instagram is to get your name out there, then you probably want to make sure users actually remember your brand.
In that case, you should shoot for Brand Awareness. Instagram’s advertising engine will then optimize for ad recall lift, an estimate of how many people remember seeing your ads within two days.
Ad recall lift is a more precise way to measure increased brand awareness than just counting impressions. Source: Facebook via Thomas Hutter
This is often more effective than selecting Reach and paying for each impression when users may not actually be noticing or remembering your ad.
When should you select a consideration objective? When there’s a specific action you want Instagram users to take, but you’re not trying push directly for sales yet.
You should pick Traffic if you’re launching Instagram ads to drive clicks to your website.
Pick Engagement if you want to focus on finding users who enjoy your ads enough to actually like, share, or comment on them.
Clearly, if you’re promoting an app, App installs is the logical objective to optimize for.
And if you’re launching Instagram video ads with the intent to get a message out, you should select Video views.
If you’re launching a video ad campaign and your top priority is getting your story seen, the Video views objective is probably for you. Source: Ads Manager
Finally, when should you select conversion objectives? Well, when you want to make as many conversions as possible.
As Sarah Cunningham, Marketing Manager at AdRoll, discusses in the webinar, conversion tracking on Instagram has made major leaps in the last two years and is now not just an option, but also a super important factor for increasing your ROI.
Instagram’s ad engine is now so powerful that you can effectively track in-store conversions. If you want to drive sales at your real-world stores, select the Store visits objective.
It’s 2018, people. Ads Manager can track in-store conversions and puppies can shop for themselves.
Alternatively, if you have an online catalog of products, Instagram can track and optimize for your sales their very accurately with the Product catalog sales objective.
Last but not least, if you have a desired action you want users to take on your website and that action is the primary motivation for your Instagram ad campaign, pick Conversions as your objective.
You can track a wide variety of conversion types from your Instagram ads with the Facebook Pixel the same way you would for Facebook ads, whether you’re looking for newsletter signups, handbook downloads, or good old-fashioned sales.
2. Choosing the perfect Instagram ad format
Now that you’ve picked the ideal marketing objective for your Instagram ads, you should consider which format is best for telling your story visually.
Of course, your marketing objectives play a major role in determining which format you should pursue.
For instance, photo ads are best for building brand awareness and engagement.
Though they’re static, the right image can really elevate how Instagram users see your brand.
Instagram photo ads also allow you to add customizable CTA buttons depending on your business needs.
For example, if you’re working in e-commerce, there’s a “Shop Now” CTA that links to your online store.
One study found that the latest CTA design for Instagram photo ads raised click-through rates by 6%. Source: Nanigans
Alternatively, if you’re promoting a local business, you have the option to add a “Contact Us” button. Other options include “Learn More”, “Book Now”, “Sign Up” and more.
When it comes to telling a longer, more immersive story, Instagram video ads are a fantastic medium. They tend to be very memorable, making them ideal for organizations that want to raise brand awareness.
We recommend that you upload an eye-catching thumbnail with little or no text along with your video to incentivize users with auto-play off to watch anyway.
Your video should also be under 60-seconds long to increase video completion rates and keep your audience engaged.
Additionally, gamifying your Instagram video ads by adding an interactive component is an exciting, innovative way to attract users that might not pay attention to a standard commercial.
Volvo had an incredibly successful example of gamifying Instagram video ads which our webinar hosts discuss in greater detail. It let users take their thumb on a test drive and—actually, we’ll let it speak for itself:
Carousel ads on Instagram, meanwhile, offer great bang for your buck. These scrollable ads include between two and 10 images and videos of your choice that users can swipe between.
Instagram carousel ads really shine when you want to display multiple examples of your products, or when you want to tell a story that engages the user by getting them to swipe through it.
They also include the same CTA options as Instagram photo ads. For this reason, carousel ads are good for driving clicks and conversions.
Finally, Instagram Stories ads are full-screen, vertical compilations of images or short videos.
They’re only available on Instagram and disappear after 24 hours, but that ticking clock and unique format motivates users to watch them sooner rather than later.
That’s why Stories are a powerful way to improve brand awareness.
You can add filters, geotags, text, or even drawn images to your Instagram Stories ads. This adds a personal touch that can make your brand seem more playful and human.
Many companies are already capitalizing on the format to tell unique, fun tales to their audiences. For inspiration, here are 5 brands that absolutely nailed their Instagram Stories.
3. Targeting your dream audience
If you want to see results from your Instagram ad campaigns, you need to target audiences that are relevant to your brand and your campaign objectives.
If you were shooting a bow and arrow with flawless form but kept hitting random trees far away from your target, people wouldn’t call you a very good archer, right?
Instagram’s rapid growth and abundance of targeting options mean that you have a great opportunity to test different ads on different audiences.
But that also means it’s easy to waste your ad budget on identifying the right audience to target if you don’t have your target persona and targeting strategy clearly defined in advance.
So, don’t blow your budget on random testing. Decide what the dream audience for your Instagram ad campaign would be first, then use precise testing methods to refine your real audience to look that way.
Instagram ads are controlled through Facebook Ads Manager and share the same three main audience types that Facebook uses for targeting:
1. Core Audiences – the default ad targeting option for Instagram users.
2. Custom Audiences – a group of users who have a prior relationship with your brand and are imported to Ads Manager from your email lists, CRM software, or other data sources.
3. Lookalike Audiences – a group of users who have similar characteristics to your existing customers.
Our very own Global Demand Generation Lead Maria Toft dropped the following tips for each kind of audience targeting in the webinar:
Core Audiences are the basic method of Instagram ad targeting. But beyond the standard targeting options of age, gender, location, and interests, you can actually target your Core Audiences even more precisely.
Behavioral targeting, for example, allows you to include or exclude users from your audience based on their behaviors, from where they’ve traveled lately to whether or not they own a car.
Connection targeting, on the other hand, lets you refine your audience based on their previous engagements with your Facebook Pages, Events, or any apps you might have.
With such advanced core targeting options, Instagram lets you hone your audience down to only users who are likely to genuinely be interested in your brand.
Just remember to use these options both to include users with traits you want and to exclude those who would not find your ads relevant.
Custom Audiences are built from users who have interacted with your brand in the past. As the graphic above shows, this can include visitors to your website, Facebook followers, people who use your app, or anyone in your customer files.
Beyond using Custom Audiences to target users who have shown interest in your organization, you should consider using the more advanced tactic of excluding people who already know your brand.
Say you want to target people interested in Champions League soccer (or football, for everyone outside the US) to make them aware of your sports blog.
Once you’ve targeted that interest in your Core Audience set up, you can use your Custom Audiences to exclude people who already read your blog regularly or like your Instagram account from your targeting to save your budget and only attract new readers.
Additionally, you can use Custom Audiences to remarket your ads more intelligently.
Source: Ads Manager via Social Media Examiner
How? Well, you can segment your audiences based on which actions people have already taken with your brand or which of your landing pages they have visited, then use that information to tailor your offers.
For example, if people have visited the shopping cart page of your online t-shirt catalog but didn’t complete a purchase, you can use Instagram Custom Audiences to serve them a special message to convince them to return.
You can also use Custom Audience targeting to upsell existing customers or offer new customers a discount code.
Lookalike Audiences are a very cost-effective way to find new customers, as they automatically include users who look like your existing customer base without requiring extensive testing or research.
When setting up Instagram Lookalike Audiences, only use your best Custom Audience files as a seed—for example, your most engaged social followers, brand advocates, and existing customers.
Avoid narrowing down your Lookalike Audiences too much, though, as a larger source audience lets the Instagram ad engine work its magic and find the best matches for your customer files—we’ve found that this works best with at least 1,000 Custom Audience members.
When creating a Lookalike Audience, you can select an Audience size between 1% and 10% of the total population of the country you’re targeting.
We recommend 1%, as this population segment is the most refined and therefore matches your seed audience best.
A Lookalike Audience based on your top customers offers highly refined targeting with minimal testing involved. Source: Ads Manager via Social Media Examiner.
Finally, include targeting expansion in your ad options when targeting Lookalike Audiences. This lets the Instagram ad engine find additional users who are likely to convert who may not be in your current Lookalike Audience for whatever reason.
4. Getting smart with your budgeting
Instagram ads are kind of like modern art. They can be visually stunning, interesting, or just confusing, and they have no set value because they’re sold through auctions.
People often ask us how much Instagram ads cost, but in reality, they cost whatever you’re willing to spend.
You set the budget, then Instagram’s ad engine will spend it as efficiently as possible based on the objective you’ve selected.
Daily vs. lifetime budgeting
As with Facebook advertising, you can set either a lifetime or a daily budget for your Instagram ad campaign.
In most cases, we recommend setting a lifetime budget. Source: Facebook Ads Manager
If you select a daily budget, Instagram will spend up to that set amount each day and no more.
If, on the other hand, you select a lifetime budget for your campaign, Instagram will distribute your budget at the optimal times throughout your campaign period.
So which is better?
Maria discusses in the webinar how in most cases, a lifetime budget is the most efficient way to achieve your Instagram marketing goals.
That’s because it allows the Instagram ad engine to learn as it goes and find the days and times where your ads can be shown most cheaply and effectively.
Standard vs. accelerated delivery
The second budgeting option you need to decide on for your Instagram ad campaign is standard delivery versus accelerated delivery.
Standard delivery means that Instagram will try to spend your budget evenly over the course of your campaign.
Meanwhile, accelerated delivery means Instagram will spend your budget as fast as it can.
The red line represents ad spend over time under accelerated delivery, the green line represents standard delivery, and the orange line represents under-delivery. Source: Facebook Ads Manager
Unless you need to get your ads out as fast as possible no matter the cost, we recommend selecting standard delivery to spread out your budget and only spend it when Instagram’s ad engine decides the most users will be receptive to it at the lowest cost.
The third and final budgeting option you need to know to run the perfect Instagram ad campaign is campaign budget optimization.
If you switch this feature on, Instagram will distribute your budget across every ad set in your ad campaign and then decide on the optimal amount of your total budget to spend for each ad set to maximize results for your objective.
Budget optimization allows Instagram to spread your funds more efficiently across ad sets. Source: Facebook Business via Adweek
We recommend switching campaign budget optimization on if you have a campaign with several ad sets that all have similar audiences.
Otherwise, it’s harder for Instagram’s ad engine to effectively compare the ad sets to each other and optimize your ad spend accordingly.
Now that you’ve set your budgeting options up, it’s time to grab a couple of fat stacks of cash—we’re going to the Instagram auction.
5. Making the right bid
So, how much money should you be throwing down to win Instagram auctions and get your ad in front of people?
As with most of the strategy behind running a flawless Instagram ad campaign, you need to think about your objective before you make that decision.
Instagram is an amazing channel for brand awareness campaigns because the medium lends itself to really beautiful, memorable visual advertisements.
If that’s what you’re shooting for, bid based on CPM, or cost per thousand impressions. This way, you’ll make a bid and pay for every 1,000 impressions on your ad.
If you’re using your Instagram ad campaign to generate direct responses like purchases or app installs, however, you should bid based on cost per conversions so that your only pay when users complete your desired action.
Automatic vs. manual bidding
Next, you need to decide whether to bid manually or automatically.
Automatic bidding allows Instagram’s ad engine to set appropriate bids for you.
As Maria explains in the webinar, this works well when you have a large audience and not too much competition for each ad placement.
However, when you have a small audience with a lot of competition, Instagram’s automatic bids might be really high to try and win hyper-competitive auctions for you.
In that case, manual bidding might be more cost-efficient for your ad campaign.
Instagram doesn’t know the value of a conversion for your company and you do—so make sure that you’re not spending more than that value when bidding on a cost-per-conversion basis.
If you don’t know the value of an action for your organization, you should pick the cheapest bid strategy and then compare your ad costs to the value generated by your ads over time, then adjust your bid accordingly.
Another word of caution: don’t make a lot of changes to your bidding strategy in a short period of time.
Tom Hanks disapproves.
Instagram’s ad engine takes time to aggregate data from your campaigns and optimizes your ads based on that information, so you need to give it time to learn from your existing strategy before abruptly changing direction.
Lastly, different audiences offer different value to your organization, so adjust your bids based on who you’re targeting.
For example, if you’re selling basketball shoes, users who buy NBA merchandise are probably more likely to buy a pair than fans of Major League Baseball.
Therefore, the NBA fans are worth more to your campaign and you should be willing to increase your target cost or bid cap for them.
…and they’ll appreciate it. But maybe not this much.
In summary, we recommend bidding based on your objectives, using manual bidding for smaller/more competitive audiences, and adjusting your bids according to the value of your different target audiences.
The anatomy of a successful Instagram ad campaign
Like the human body, an Instagram ad campaign has a lot of moving parts…and a lot of things that can go wrong.
But also like the human body, Instagram ads can accomplish amazing things. That’s why it’s worth your time to study anatomy with our free, in-depth webinar The Anatomy of a Successful Instagram Ad Campaign—available in full, on demand.
It contains tons of extra goodies on top of the insights we’ve covered in this blog: from creative best practices to guidelines for picking and analyzing the best metrics for your next Instagram ad campaign.
And if you’re still hungry for more Instagram knowledge, boy do we have some treats for you! For example, here are 11 Proven Ways to Boost Instagram Organic Reach, a guide on Creating Professional Instagram Bios, and a bunch of actionable tips on Instagram SEO.
Finally, if you really want to scale up your Instagram strategy, you can save huge amounts of time and energy with Falcon’s Instagram Publishing and Measurement, which lets your whole team collaboratively create, schedule, and analyze results from your Instagram ad campaigns—all from one unified platform.