Since it was first launched, Instagram is known for its unique visual style. People love to share photos of their personal life or interest. But as time goes by, it becomes a popular media to promote something. Amazingly, advertisements on Instagram feel natural so it won’t disturb the user’s view. If you are interested in using Instagram as a marketing strategy, then you better find out everything about the Instagram promotion budget.
Actually, there is no exact number regarding the Instagram promotion budget. It depends on your goal to achieve which set at the beginning. But as a quick answer, you can see the CPC (cost-per-click). It shows the cost you will pay for every ad which clicked by viewers. Remember, CPC is only for the clicked ad, not for a complete purchase or action you wish. For further discussion about the advertisement on Instagram, see what we discuss here.
Is It Worth to Advertise on Instagram?
Knowing that Instagram costs you money for promotion, you might wonder how worth it is. We might say that it is better for you to put an advertisement on Instagram than on its parents’ company, Facebook. Because the ads do not only look natural but also open a wider opportunity to interact with people. So, you have more chances to get a conversion.
Another greater thing is Instagram leads more people compared to other social media platforms. The more you significantly target people, the more potential they click then buy your product or use your service. So, it is normal when the Instagram promotion budget becomes higher than for Facebook. That is because of a better result you will get at the end.
One more fact you should know is Instagram like a pool for celebrities, influencers, Millennials, etc. It is a hub with massive increasing users day by day. There is no social platform like Instagram that is able to reach different leads and potential customers. When you successfully tailor the ads with the right target audience, then you can connect with more leads without knowing from anywhere they are and your business will expand wider.
Also read: How To Set Up Instagram for Business
Instagram promotion budget You Should Prepare
At the opening, we have mentioned CPC which requires you to pay because your ads clicked. There is another charge you might get, it is called CPM (cost-per-mille). People also familiar with CPM ad impression cost that you are paying for every 1,000 potential customers view your ad. Whether the CPC or CPM, they are the cost model for bidding which will be explained in the next chapter.
As for an illustration, when you choose the bidding based on CPC, it will cost about $0.5 – $2. It could be higher for competitive industries, such as fashion, travel, etc. Also, the age group can determine the amount too. The 25-35 years old group has a higher price than people below 17 and above 40 years old people. On the other hand, CPM can reach up to $5 or $6 per 1,000 viewers on average.
Generally, there are two types of Instagram promotion budgets: daily and lifetime budget. These kinds of budgeting are based on the campaign. You can decide which budgeting type to choose in the Budget & Schedule section when setting up the Instagram campaign. Remember, once the campaign has been created, you cannot change the budget type. So, see what the difference between both budgeting below:
1. Daily Budget
The first kind of Instagram promotion budget is a daily budget that sets your ad to run throughout the day 24-hours. As the user, you just need to put a specific amount, then Instagram will allocate the budget in full for one day. But one thing you should know that people set their budget on average rather than the absolute entire amount. Before you end up setting, Instagram will show you the prediction to help you decide the budget.
The actual amount daily can be varied. On a certain day, it might get higher than others to get a better result. Because you cannot predict when people click more, thus, sometimes the user might get over budget on that day. But don’t be worry, Instagram won’t stop your campaign, it will keep trying to promote your ad and compensate tomorrow.
This type is fit for the remarketing campaign. Instagram will help you to catch relevant users throughout the day and night. Instagram ensures them to keep in touch with your business and tries hard to lead them into conversion.
2. Lifetime Budget
This one is another Instagram promotion budget. The lifetime budget is for those who want to spend the budget during the campaign running. So, you have to set the specific length of the campaign, then the algorithm will manage your spending over that time period. You don’t have to check and adjust the budget daily because Instagram automatically spreads the amount.
How about a certain day when many people click an ad? You won’t face this case because Instagram only selects the best timing to advertise based on your target audience selected. That is why there will be no over budget or an additional cost than the budget you have set in the first place. But, remember, you also won’t get a better result because you probably miss a “special” moment.
The lifetime budget is the answer when you are in a strict campaign budget. There will be no extra budget given during the campaign. But, this budgeting is actually good for maximizing exposure in a short period. Your ad will be time-sensitive and only shoot the right people to get engagement.
Also read: How to Purchase Instagram Followers
Factors That Affect Your Budget
After knowing what makes the daily and lifetime budget is different, now is the time to understand what will affect your budget. These five things influence Instagram promotion budgets, no matter what kinds of industries. See what contributes to your campaign cost:
1. Bid Price
This is what we mean related to the CPC and CPM. There are two kinds of bidding: manual and automatic bid. The manual is good if you already have known how much budget to spend, what exactly the goal to achieve, and understand the market sense. While we recommend choosing the automatic bid if you are unsure about the amount to bid.
2. Ad Quality and Relevance Score
It represents how potential your ad will be shown on people’s accounts. The higher your ad quality and relevance score, the more people surely will see your ad. Because Instagram detects your ad has a highly relevant content to appear in someone’s feed.
3. Estimated Action Rates
It is based on past actions you have done and the Instagram ad’s performance data. For automatic bidding, Instagram will help you to win based on your budget even though you have a low estimated action rate before. While in manual bidding, you have to be clever in placing the amount to compete.
4. Time of Year
Instagram knows when to promote the brand at the right time. Thus, when it is the peak, there is no wonder when the cost becomes high. Because it will be hard to catch the exact target you want. The one who offers the highest bid will win. The examples of the time are Christmas, New Year, Valentine’s Day, etc.
5. Target Audience and Competitor
It obviously affects your budget because the more brands target the same audience, the competition will be harder. Within this situation, the bidding will be a war. To be a winner, it is for sure offering higher bidding than your competitors.
Understanding Instagram promotion budgets are really important for every marketer and business owner. You won’t get the exact answer without knowing what’s behind this advertising strategy. Use your sense to grab the expected goal and learn the data from your previous activities. Those will help you too to optimize the money.