Tips to Create Instagram Ads on a Budget (2021)


Creating effective Instagram Ads is a goal for many social media marketers and entrepreneurs who don’t have unlimited budgets.

If you are looking to add Facebook and Instagram Ads to your social media marketing strategy, but don’t want to feel like you’re throwing money blindly, this article is for you.

What Is The Best Budget For Instagram Ads?

The only true answer is “It depends.”

The truth of the matter is that your costs will vary depending on the industry, month, day, hour, location, and the status of your advertising account (and those are just a fraction of the variables at play).

As a general advice, I tell my clients to consider $1,000 to start, as long as they are targeting an audience that’s between 400,000- 700,000 people.

Please take this advice with a grain of salt.

Apple’s iOS 14 Release May Affect Your Ads

Apple has announced changes with iOS 14 that will impact how Facebook receives and process conversion events from tools like the Facebook pixel.

As more people opt out of tracking on iOS 14 devices, ads personalization and performance reporting will be limited for both app and web conversion events.

In response to these changes, Facebook has issued new Facebook ads guidelines in 2021 for its advertisers, covering the details of the updates and offering solutions.

Facebook said its internal research has found that small businesses earned 60 percent less in sales when they were not able to use the kind of targeted advertising Apple aims to limit.

In a post called Speaking Up for Small Businesses, Dan Levy, the VP of Ads and Business Products, claims that the “new iOS 14 policy will have a harmful impact on many small businesses that are struggling to stay afloat.”

Levy believes the changes will impact businesses in these ways:

  1. Force businesses to turn to subscriptions and in-app payments
  2. Make advertising less efficient and effective
  3. Cause a loss of personalization that could result in 60% fewer website sales from ads
  4. That loss of personalization could lead to a drop in revenue by 50% resulting from Facebook app install ads
  5. Make it more difficult for small businesses to reach their ideal audience, limiting growth
  6. Facebook created a page for small business owners to “add your voice” in opposition to the iOS 14 updates. Facebook even created a toolkit to help you share posts, videos, and stories to #SpeakUpForSmall businesses.


Now let’s move on to the base question. Shall we?

First Step To Create Instagram Ads (Or Facebook Ads): Budget Structure 

The first logical question when you’re purchasing ads is related to MONEY, right?

You want to know how much will this cost versus how much will you get in return from your Instagram Ads (or Facebook Ads).

Run A Competitor Analysis

Your budget depends from your industry. If other advertisers are trying to reach the same audience members, costs go up as newsfeed space is not unlimited.

For example, if you are in the fashion industry and your target audience is similar to Spanx, you can go to Spanx’s Facebook Page and visit their ads manager to have an idea of their current ads.

To find Page Transparency of any Facebook Page, check around the About section and you will see it. From Page Transparency, go to Ad Library.

The Ads Library of any public page will reflect all the campaigns they are running.

As a marketer, this step can give you insights about what your users are expecting from you, especially for creative and visuals.

Your bidding strategy needs to consider your bidding competitors, in order to determine how much money you will spend in ads.

Can you compete with them? Absolutely yes.

But you need to find ways to stand out from the crowd!

If you’re starting, you can let Facebook find the best bidding strategy for you, but you still need to understand some fundamentals in order to set up your campaign goals.

Second Step To Create Instagram Ads (Or Facebook Ads): Audience Targeting

Target Your Audience Using Custom Audience Features

Facebook has automatic ads that users can just follow to get more visibility.  While you can get some results such as comments, shares, video views, and website clicks, we don’t recommend starting there.

If you haven’t been using your Facebook Page or Instagram Business account that much, before paying for ads, implement a strategy where you can activate data from the following features:

  1. Website traffic
  2. Email list
  3. Facebook live
  4. Video library
  5. Events
  6. Instagram profile
  7. IGTV

Facebook custom audience feature is where you will tell Facebook that you want to find people with similar qualities of the ones you already have.

How To Set Up Custom Audiences

From Business Manager– go to shortcuts Audiences – Create Audience – Create a Custom Audience.

These custom audiences might not be ready to use. But you want to still create them to start the process.

What if you don’t have any audience? Can you still start with Facebook Ads?

You can, but just know that you will pay more.

To avoid the painful big invoice with no results, start your campaign with organic events that can guide Facebook into who is your target audience.

This process can significantly reduce your Facebook Ads cost at least by 50%.  If Facebook needs to do all the work, from ground zero, you will pay much more.  This is why we say that your ads account status plays a big factor in the budget you’ll need for Facebook and Instagram Ads.

Third Step To Create Instagram Ads (Or Facebook Ads): Pixel & Pixel Events Setup

Set Up Pixel & Pixel Events 

The Facebook pixel is a tool that allows you track all the activity that happens within Facebook and Instagram.

For example, when someone engages with your Instagram post, Facebook Pixel will track that user.

Think for a second here… those users who play the “follow – unfollow” game on Instagram will still see your Instagram Ads! 😜

The pixel also tracks activity within your Facebook and Instagram accounts.

  1. You can target people who followed you on Instagram in the last 365 days (even if they unfollowed you, they still will see the ad).
  2. You can target those who messaged you on your DM or Facebook Page messenger.
  3. You can target those who clicked on your Link in Bio!

Essentially, every single reaction from your users is getting tracked by the Pixel. This is why you can’t skip this step.

A pro tip: if you want to track users that visit your website and click a particular side of your pages, you can use Facebook events setup tool to connect your website to the Facebook events.

Facebook Attribution Tool

To promote e-commerce, we recommend setting up your Ads Manager using the Facebook Attribution Tool.

This tool will help you getting granular metrics. You’ll be able to see exactly where your customers are in the funnel, and create campaigns with different objectives.

For example: you can launch a testimonial campaign with a “reach” objective. Using Facebook Attribution model, you’ll be able to track if those who saw your Ad went to your website, and which product they considered.

This information will help you setup another ad, targeting those website visitors – by product page.

Facebook Attribution tool has saved our e-commerce clients up to 40% in ads budget.

Fourth Step To Create Instagram Ads (Or Facebook Ads): Campaign Strategy

Here’s where you take your competitor analysis to a deeper level. Take some time to research so you can design a solid strategy for your Instagram ads.

  1. Who will be the users?
  2. What motivates them to follow you?
  3. What could be ONE struggle you could help them with, right now?
  4. What is your BEST-ONE solution that will them with their struggle, right now?
  5. How can they trust in you?
  6. What will take those motivated users to say yes to your offer?

The success of your campaign starts with strategizing. I wrote for Social Media Examiner a guide that explains how to model a customer journey. Click here and save this article for later. 

Let’s cover one of our best campaigns, step by step.

Fifth Step: Creating Your Instagram Ad Using Facebook Ads Manager 

Campaign: Customer Testimonial

Due to its nature, when you share a customer’s testimonial, it is very much like word of mouth – the single most effective tactic for driving customer purchases.  Yes, you read this right. According to Nielsen, 92% of people trust recommendations from friends and family over any other type of advertising.

When you share a testimonial from a customer, you’re encouraging your future buyers in a positive way to make a decision; which is what we want to achieve from your campaign!

When you hear “customer testimonial”, perhaps you think you need a professional video or image, similar to those ads on tv. High quality, high production, picture-perfect!

That’s actually not the case!

Customer testimonials might be a bit more honest and authentic nowadays.

Here’s The Anatomy Of A Testimonial Ad Campaign

Ad format: 

For your testimonial ad, you want to create a visual that blends with your brand, to give the native look. The goal is to inspire users to read your content and click on the call to action.

Why an image and not a video?

“Video marketing” is one of today’s hottest industry buzzwords. You might have read that posts with video get more engagement.  The truth is, 85% of videos on Facebook are watched without sound. For this reason, we recommend a highly optimized visual with your testimonial ad, instead of risking it with a video.

See the image below, for example. For this campaign, we use an image that represents a homeschooled student. No text on the image. We want users to read the testimonial and then click on the “learn more” button.

This particular campaign has brought a great performance during a 30-day period:

Reach: 47,968

CTR: 3.59%

Conversions (landing page views) 3,231

Cost per result: $0.23

Choosing your ad format is crucial for a winning campaign. This is where you will put in practice what we mentioned earlier about functionality and experience.


For your testimonial campaign, you will choose a visual that represents your client.

What if I can’t share my client’s pictures?

We recognize that some industries have regulations and have to protect their clients’ identities, like our homeschool kids, for example. It’s ok if you have to use stock images.

When choosing your visual for your ad, ask yourself these questions:

  1. Will my users recognize what are we promoting in less than 3 seconds?
  2. Is the visual clean and inspiring?
  3. What kind of emotion this visual is triggering?
  4. Is it too promotional?


There’s something to be said about a real testimonial, which is what we encourage you to do. We recognize that not all your clients are great writers, so we want to give you an extra tip that will help you produce the best stories for your testimonial ads!

Here’s an example of how to ask your favorite client for a testimonial:

Hi _____, we’re inviting new users to check out our services and we need your help! Can you please share some words with us? What challenges you had when you reached out to us? How are those challenges today in comparison to when you started with us? Can you share some specific wins or how your life has changed now that you’ve seen the results?  Thanks a lot! M

Let them answer those questions for you. You will be surprised by the words they pick to describe your work.

When you receive your client’s testimonial, feel free to polish the copy in a way that flows a narrative.

Call to action

The call to action in your ad has 2 elements:

Your headline: describe the “what” and make it very simple. In our example, the headline is: Homeschool Writing Curriculum Online + DVD + Online Community

The call to action button: Since this is a testimonial ad, we want to follow a more organic approach. A great call to action button will be “learn more”.


Choosing your objective is not just about what’s your marketing objective. Here’s an area where we need to integrate other metrics in order to make the decision of what objective to use.

Your account might not be ready for a conversion ad-objective, and here’s why

Facebook advertising guides give us benchmarks on conversion ads. Keep in mind the 10,000 fires because this is your new benchmark.  If your Facebook pixel is registering at least 10,000 pixel events on your website in the last month (or 30 days), then you can select conversions as your ad objective.

If you don’t have the required 10,000 pixel fires per month, then your ad objective will be Traffic, if you have a very defined audience.  If you haven’t done ads, then we recommend starting with Engagement as your objective.

  • Placement

When it comes to placement, you will notice 2 options: automatic or manual. NEVER leave it on automatic placement.  Open the manual placement and you will notice their options.

Our best performing testimonial campaigns have just ONE placement: Facebook Feeds. That’s it.

We know our audience very well and we know that they will most likely read a testimonial ad from Facebook. We encourage you to make a decision based on what your audience wants and how will they engage best with your testimonial ad.

We like recommending just Facebook News Feeds, simply because everybody is used to seeing a post and leave a comment if they have questions. It’s a very predictable and easy experience.

Why not marketplace or messenger? Marketplace and messenger are great placements, but not for every industry. These are placements that fit best a flash sale, last-minute promotion, or anything in that nature.

A testimonial ad isn’t your traditional promotion so you don’t want to waste budget. Keep it vanilla-simple!

Audience Targeting

Audience targeting is one of the most fascinating features that Facebook offers.

Where to start?

A great place to start gathering intelligence about your target audience is on Facebook Audience Insights.  You will be able to see details about your audience that are beyond demographics, like digital behavior for example. This means that Facebook already knows what kind of content and especially what kind of ads will most likely appeal to your audience.

From Audience Insights you can also save your audience. Just make sure this audience is saved on your correct Facebook Ads account.

If you’re not sure, just use the data from Audience Insights and create a new audience from your business manager.

On Business Manager menu, go to Assets- Audiences

Once you’re on Audiences dashboard, select “create a saved audience”.

This is the process to create a new audience, which we recommend, just to craft a fresh campaign. Try to have an audience just under 1M users. This will be relevant when it comes to selecting your budget.


When it comes to budget, we like to suggest a formula based on the estimated daily reach and estimated conversion rates.

Remember (again!) the benchmark of 10,000 views.

Here’s a way to strategize your 10,000 benchmark in a 30-day window: 300,000 accounts reached with a 3% CTR = 10,000 views (tracked as “pixel fires”). How can we do it within 30 days? Choosing the right budget! 

See, for example, a campaign with $20 a day for 30 days. This has an estimated reach of 1,800 to 5,100. If we hit the best-case scenario, (5,100 per day), this means that in 30 days we have 153,000. But… that’s not the benchmark!

Let’s see the same campaign, with a daily $100 budget. Best case scenario went 4x higher. 22,000 a day. That’s a 660,000 accounts reach. But remember, that’s your best-case scenario.

What budget should you use then?

Start this campaign with the $100 a day. You will have much quicker results (and better). You can always adjust the budget during your campaign.

For example, set up campaign for week 1, $100 a day, then monitor results for the next 3-5 days.

Week 2, $80 a day and monitor the results.

Remember, this is a testimonial ad will also be placed on your business page and will reach people organically as well.

Don’t be afraid of adding a reasonable budget to your campaign. Playing with $5 a day “to see what happens” won’t give you the best results. Facebook has ways to deliver you the best results possible, with their campaign budget optimization feature.

A note on the pixel fires: For the purpose of 10,000 pixel fires, every website traffic source matters. In other words, if you’re blogging and using SEO, those visitors count towards the 10,000 goal. Blogging is good! 

Instagram Stories Ad

Instagram Stories is another way for you to tap into people’s passions and inspire them to take action. In fact, of the 500 million accounts using Instagram Stories,1 one-third of the most-viewed stories come from businesses, and one in five stories gets a direct message from its viewers.

Why are stories a big component of your upcoming campaigns? 

It’s because of novelty. People always tend to be drawn to novelty products and ideas. When you’re presenting them with a message in a new format, in theory, based on the psychology of novelty, it will make them curious, at the very least.

What’s the catch? 

Instagram stories offer another level of creativity. From interactive filters, to swipe, and even music!

When you’re promoting your business using Instagram stories, adding your Facebook Ad to Instagram won’t make the cut.

Should you use videos or images for stories?

Users have short attention spans and will only spend this much time on a content. Animation evokes emotions that resonate with the viewers. It sparks conversations and makes your audience want to follow the story.

Since stories are 15 seconds max, videos will help you stand out! Especially boomerang videos you can make with your Instagram app. Very simple.

There are tons of great apps and tools like Mojo and Over that can help you create fun animations for your Instagram Stories posts, without having to hire a graphic designer or spend hours learning how to edit videos.

Advertising Stories 

Both, Facebook and Instagram have stories. The best way to manage your stories campaign will be from your Facebook Ads Manager.

Ad Objective

Your goal is to bring awareness of your amazing products or services. For this campaign, your ad objective can be video views, since the story will have a 15-sec video. Select your objective and add your campaign name.

Notice that you can click on campaign budget optimization. This option renders a great value for your ads. So, turn that on!

Ad Placement

Since we are creating your stories ad, we will select only stories placement.

Optimization & Spending Controls

Your story only has 15 seconds. It seems like it’s a short time, but it’s not, when you consider the rest of the message you will send to your audience. Optimize your campaign for thru plays and this will give you access to more engaged users.

Producing Your Video

Videos will be the best way get your audience curious. Make it about a flash sale! These are great to make your audience responding fast.

There are many ways to produce stories with videos. Just make sure all your content is in 1 video, under 15 seconds.

  • You can create the story directly from Instagram or even Snapchat. Showing your audience the new product, letting them know they can get it on sale.
  • You can create a custom animated graphic without being a graphic designer! Made With Over is a great app! They always have cutting-edge templates that you can curate.

Edit Your Media, Especially Thumbnail 

Facebook allows you to edit your stories which is great! You can change background, image, and pick the preview image from your video!

If you are uploading a video you recorded from Instagram stories to place your ad, note that you will be able to add text and also use templates. Click on Text Overlay and Logo Overlay. Customize it as much as you want!

Even if you created the video, double-check that your media is looking sharp!

Text & Links

Remember that novelty is what you want to create when users take a look at your promotion. Make sure you use words like:

  1. 4 hours left
  2. Last call
  3. Bo-Go
  4. Save 75%

Promote! Don’t be shy about showing the world you have a great product. Then link your sales page.


Use Facebook reach estimator and find a number of reach that can potentially take you to the most-wanted 10,000-mark. As we explained above, you can start this campaign with $100 a day. You will have much quicker results (and better). You can always adjust the budget during your campaign. You can always adjust within the next 3-5 days.

To Recap!

Instagram Ads & Facebook ads are a great way to boost your social media presence.  Design a strategy for your ads, segmenting the different steps of the process:

  1. Strategize your target audience. Remember to study your competitors.
  2. Design custom audiences. It might take a few weeks, but it’s better to market to a warmer audience and also to let Facebook know that you want to find other users like them.
  3. Stay away from automated ads, automated placements.
  4. Be aggressive in your budget, even if you won’t spend it.
  5. Set up your Pixel events.

I hope this inspires you to learn more about Facebook Ads.

If you’re a marketer and want to learn advanced Facebook Ads, let’s chat!