How to determine your Instagram advertising costs

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You already know our recommendations for a rough budget, but it still makes sense to calculate the Instagram advertising budget for your company individually.

This depends on three factors:

Target group size: The more people you want to reach with your Instagram advertising, ukraine phone number data the more budget you will naturally need.
Frequency: This is about how often you want to reach your target audience with your ads. Due to the short attention span on social media, a large number of touchpoints are usually necessary to actually encourage users to click and buy. Depending on the product, up to 20 touchpoints may be necessary. So should you just start blasting away? Better not, because otherwise, so-called ad fatigue could set in – that is, the annoyance of your ads. A good frequency in the upper funnel, i.e., for cold target groups, is 1 to 2.5. In retargeting, i.e., for warm target groups who have already had contact with your brand, the frequency can be somewhat higher, for example, 4 to 6.
CPM: The third factor in calculating your Instagram advertising costs is CPM, or cost per mille. This is the price you pay to reach 1,000 users. CPM varies greatly depending on your target audience and industry. Rough guidelines range from €4 to €6 in the upper funnel and €7 to €11 in the lower funnel.
The formula for calculating your Instagram ad budget is:



This means you should plan a total budget of € 5,025 . However, this is only a rough guide, as it essentially just says the following: With € 5,025 , you can reach all users in your target audience 1.5 times with one ad. However, you have to keep in mind that you don't actually know your exact target audience size or that you may want to develop additional target groups for your product over time. Furthermore, 1.5 touchpoints are often not enough to actually achieve a conversion. It therefore makes sense to repeatedly target your target audience with new ads over a longer period of time so that you reach a larger number of touchpoints without triggering ad fatigue. Finally, this budget does not include any testing budget - however, ad creative testing is essential for successful Instagram advertising, as it allows you to use data to determine how to best address your target audience.