Instagram Advertising: Types, Tips, Costs, and Examples

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An incredibly effective way to promote your business on social media platforms is through Instagram advertising. Advertising on Instagram allows you to reach your target audiences and engage with your potential customers on a platform that many people use. Having nearly one billion active users monthly, it makes sense to develop an Instagram marketing strategy for your business. Here’s how.

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What is Instagram Advertising?

Instagram advertising is the method of posting ads that pop up on a user’s Instagram feed. Businesses can pay to post sponsored content on Instagram, and is often placed with a “Sponsored” label. 

With people regularly opening the app on their mobile devices, Instagram advertising helps you generate brand exposure, push website traffic, generate new leads, and move your leads down the funnel. 

Text ads are not a thing on Instagram since it’s such a visual platform. This provides an effective way for companies to develop eye-catching visual content. Instagram ads typically appear as a photo ad, a carousel ad, a video ad, or a slideshow. You can also feature call-to-action buttons such as “Learn More” or “Shop Now,” which all depend on your campaign objectives. 

Why Should You Advertise On Instagram?

Instagram advertising is a lucrative channel for many businesses. According to Instagram, there are more than 200 million Instagram business accounts on the platform, with 90% of Instagram accounts following at least one brand. 

A good presence on Instagram allows businesses to cater to clients’ needs much easier. Whether it’s to increase brand awareness, get more clicks to your website, or generate sales, you should consider Instagram advertising for these reasons:

  • Instagram is already a massive, ever-growing community. It’s also bringing in serious cash for businesses, attracting big and small brands alike. 
  • Instagram and Facebook are connected, which makes it easier to define custom audiences based on Facebook data. This also lets you find your lookalike audience, allowing you to reach new users similar to your existing customers and are likely to be interested in your business. 
  • Instagram advertising uses Facebook’s advertising platform, making it easy and convenient. The ads manager helps you see your Instagram ad metrics to gauge performance, audience, and placement data quickly. 
  • Compared to other social media platforms, Instagram’s engagement rate is much higher. This is an advantage, especially for purchasing purposes. An engaging product post can drive purchases through the roof, which is precisely the intention of Instagram advertising. 
  • Instagram advertising looks like any other shared posts on the platform, making it less intrusive. 
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Types of Instagram Advertising

There are multiple ways to advertise on Instagram to increase your brand awareness and connect you even more to your customer base. The types of Instagram Advertising are:

1. Photo Ads

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Image grabbed from Yelp

Photo Ads are posts that show up organically in your Instagram feed. These posts appear like any other user-generated content but include a “Sponsored” notation to let people know that it’s an ad. These ads can include a call-to-action button located at the bottom to direct people to your website or your Instagram business account. 

Instagram advertising through photos is effective when you have a visually stunning picture that you believe can help get your message across. Make sure to keep it simple but effective enough to stand out and grab people’s attention. 

You can also use this format to promote past Instagram posts from your account. You can browse for the more popular posts you’ve had and click “promote” to get things started. 

2. Video Ads

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Image grabbed from Lionsgate Movies UK

Video Ads are posts that appear on the Instagram feed in dynamic video format. Video ads can be posted in as short as one second or as long as sixty minutes (attached to Instagram TV). In creating video ads for Instagram, try to provide plenty of information regarding your product or business. 

You may also use this format to post a teaser that can get people to click through and learn more about your brand. In addition, videos allow you to post more dynamic content to entice video views and catch people’s attention. 

3. Carousel Ads

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Image grabbed from Tesco Food

Carousel Ads on Instagram elevate the organic posting style by creating a series of up to ten photos and/or videos in a single ad. These posts exist in the Instagram news feed but add a link to a different URL to each photo or video. These ads allow you to showcase a specific collection or a group of products you intend to promote. 

However, instead of seeing carousel ads as a means to post more content into one ad, see it as an opportunity to present a story that best represents your campaign. They should be able to function together and make sense cohesively to add impact and effectivity. 

While photo ads are seen as one-page ads in a magazine or newspaper, carousel ads are more like lookbooks and mini catalogs. This can be a great option when putting out a new product line or a seasonal collection. 

4. Stories Ads

instagram advertising

Image grabbed from Casper

Instagram Stories Ads are ads that appear between people’s Stories. Much like the content posted by users, these ads appear on full screen with the same number of seconds of exposure as a Stories’ post. You can also put in a call-to-action in Stories Ads, allowing the audience to “swipe up” from the bottom of the screen to learn more or directly purchase items from your business account. 

Like on Instagram Stories, ads created here utilize all capabilities from Stories, such as adding video effects, putting in face filters, and grabbing attention through fun stickers. 

5. Explore Ads

instagram advertising

The “Explore” section on Instagram allows people to discover new content linked to their interests. Explore ads don’t directly appear on that section but only show after a user opens an image or video from Explore. 

Placing an Explore ad can be significant additional ad placement for Instagram advertising and run alongside most post ads. In addition, explore ads generally target your lookalike audience, which in turn broadens your reach even further. 

6. Collection Ads

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Image grabbed from Treatwell UK

Instagram Collection Ads allow audiences to view and purchase products in a smooth and immersive way. A collection ad on the Instagram feed includes a cover image or a video, supported with three product images. 

Clicking an item within a collection ad post redirects users to Instant Experience, the full-screen landing page which serves as an eCommerce storefront on Instagram.

7. Shopping Ads

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Image grabbed from HM Man

Shoppable posts can also be created on Instagram in the form of Shopping ads. Users can tap on the content and be redirected to a product description page within the app. This allows people to buy the featured item on your post from your online shop or Instagram business account. 

Businesses with an Instagram shop can create these ads quickly and easily for a direct Instagram shopping experience. 

8. Creator Ads

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Image grabbed from Olivia Culpo

A rapidly increasing method of content marketing is by utilizing the broad reach of social media influencers. Branded Creator Ads consist of photos or videos that one creator organically makes with a specific brand’s products or services. This user-generated content then gets shared as a paid ad.

A brand needs to collaborate with an Instagram creator who allows the brand or business partner they are working with to share that post. Creator ads rely on direct relationships between creators and brands and are a great way of highlighting organically made content.

9. Reels Ads

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Image grabbed from Feroldis

Instagram Reel Ads are ads that are shown in between reel videos. In response to the TikTok revolution, Instagram introduced Instagram Reels in the middle of 2020. These short and entertaining videos utilize the platform’s audio, effects, and creative tool capabilities. 

Like ads in Stories, Reels ads are on full screen and vertical, which can appear in a loop for up to thirty seconds. Since they follow the same format as a regular Instagram Reels video, your Reels ad is unobtrusive and becomes a part of the reel video feed. 

Advertising in this format is the best place on Instagram to reach people who don’t follow you and provides a global stage for brands. This allows you to achieve more significant audiences, which lets people discover the content from your account and products from your brand. 

How Much Does Instagram Advertising Cost?

When defining your Instagram marketing strategy, it’s important to remember that there is no specific set standard rate for how much Instagram ads cost. Advertising costs on Instagram tend to vary depending on target locations, days of the week, demographics, and a few other factors. 

To remain within your lifetime budget, consider the approach you wish you take and test everything to find which works best. Using campaign budget optimization, you can base your approach on your daily budget or use several options and define how much you intend to spend. 

Don’t forget to monitor your ads manager and use Instagram Insights to measure your performance. This way, you’ll know which ads deserve the needed boost for more engagement and sales. 


Instagram advertising can help your business achieve its goals by broadening the audience you organically reach with your content. Having a mean social media game is crucial in itself, but you can’t rely on your individual posts. 

Having a well-curated feed doesn’t help if you don’t increase your conversions. So it’s good that you have many means of pushing your good game even further through Instagram advertising.

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