Even if you’re still on the fence about whether Instagram advertising is right for your business, one thing’s for sure: Consumers are flocking to the Instagram app throughout peak shopping seasons.
Advertising on Instagram gives you the opportunity to reach millions of people — many of which are your ideal customers. Some 81% Instagram users rely on the platform to research products or services before purchasing.
Sounds great, right? But there’s just one problem. Instagram advertising gets more expensive throughout popular shopping periods. Brands everywhere are bidding against each other for advertising placements on the social media platform. Market oversaturation also makes it more difficult for your content to stand out once you do secure the slot.
But a solid budgeting and bidding strategy can help you overcome these problems. This guide shares key dates to add to your advertising calendar, as well as advice on how to fine-tune your Instagram bids and budgets around them.
Important dates to add to your marketing calendar
Alongside yearly events like Valentine’s Day, Mother’s and Father’s Day, and Independence Day, the last few months of the calendar have several important dates to consider in your marketing schedule, including:
- Halloween: The average consumer spends $102 on Halloween-related items.
- Thanksgiving: Shoppers spend $5.43 million on Thanksgiving purchases leading up to the last Thursday in November.
- Black Friday & Cyber Monday: People spend more than $133 billion on Black Friday, Small Business Saturday, and Cyber Monday — the weekend following Thanksgiving.
- Christmas: The average person splurges $846 on Christmas gifts.
Advertising historically gets more expensive throughout these peak times. More people are shopping online than usual, and advertisers want to take advantage of that. But more companies bidding for already-limited advertising slots drive up Instagram ad costs.
However, preparing your Instagram bidding and budgeting strategies in advance puts you in the best possible position when those key dates roll around. You’ll have flexible budgets that can change as each date approaches, allowing you to splash the cash while people are in the purchasing frame of mind.
Plus, tweaking your bidding strategy around important shopping dates maximizes your advertising return on investment (ROI). You get those advertising slots at the lowest cost, without paying over the odds — and potentially losing money.
How Instagram bidding and budgeting works
Your Instagram advertising budget is the amount you’re willing to spend on your campaign. Choose from daily budgets or lifetime budgets (the maximum you want to spend). Either way, the higher your budget is, the more likely Instagram is to show your advert to users who match your targeting criteria.
Brands can choose from three different bidding strategies inside Facebook Ads Manager:
- Spend-based bidding. If ROI is your main priority, choose this automatic billing option to get the most value out of your Instagram ad spend. Choose to bid for ads on low-cost (and higher volume) or highest-value purchases.
- Goal-based bidding. Choose an objective for your campaign, then set a minimum ROAS (aka return on advertising spend) you want to achieve. You can also set a cost cap with this option, such as $5 per lead when selling a $15 product.
- Manual bidding. Have the final say over how much you’re willing to pay for an Instagram ad slot. A bid cap stops you from paying for advertisements if the price exceeds your predetermined marketing budget.
The Instagram algorithm takes your predetermined budget into account and bids for certain slots. The advert with the highest total value — a combination of the bid amount, estimated action rates, and ad quality/relevance score — wins the placement.
Unsure what you should set as your bid? Instagram’s generic advice states:
“We recommend starting with at least $5 for your budget and picking a duration over 6 days. When you start with this amount and duration, it allows our ad delivery system to find the best people for your ad.”
How to alter your Instagram budget and bidding strategy around key dates
Defining a bidding budget through the holiday season can be trickier than usual. You don’t want to assign too much cash and overpay for each slot. But you also don’t want to be on the other end of the scale and miss out on ad placements because a competitor won with a higher bid.
The best way to prepare bids and budgets for peak shopping seasons is to look at historical data. When did you notice an upward trend in Instagram advertising costs? How much more did you spend to target your audience throughout those peak periods?
If you’re usually billed $1 per click, but the price shot up to $1.75 in October, for example, using the latter amount gives you a good starting point. There’s less risk of losing out on placements for advertisers sticking with their year-round budgets.
“Make sure you not only figure out the correct budget, but also have a strategy for sticking to it throughout the season. Retailers have already started advertising holiday specials, and there is a strong drive to shop earlier than ever before to avoid supply chain problems.”
Marc Stitt, chief marketing officer of FMX
Don’t have any historical data to rely on? Research shows that between October and December of 2020 — when shoppers were taking part in Black Friday sales and buying Christmas gifts — Instagram advertisers were paying $11.58 to reach 1,000 users. The typical cost-per-click (CPC) for a website traffic campaign was $1.52.
Regardless of the budget you set, Exploding Topics’ founder Brian Dean recommends being “flexible in your approach when deciding how much to spend on Instagram ads.”
“Use the 70/30 rule to divide your digital media spending. 70% of your Instagram advertising budget is put aside for fixed costs, while the remaining 30% is set aside for variable costs, such as reactive Instagram ads,” Dean explained. “If any amount of the 30% isn’t required, it can always be returned to the main spending fund.”
3 bonus tips to prepare for holiday Instagram ad campaigns
Nobody likes paying over the odds — especially marketers, who have pressure from stakeholders to prove their advertising investment is driving results for the business. Missing out on consumer spend during key dates is a wasted opportunity to sell through Instagram.
Let’s take a look at three bonus tips to manage your Instagram bids and budgets throughout peak shopping seasons.
1. Lean into retargeting
Retargeting works by targeting Instagram users who’ve previously engaged with your app, website, or ads. For example, eCommerce brands use the Facebook Pixel to match people viewing its product page with Facebook profiles, allowing the brand to reach those people with retargeted adverts through their Instagram feed.
The vast majority (97%) of people will leave your website without purchasing. Retargeted ads drive them back, reminding them of what they viewed and why they should buy it — hence why customers retargeted through ads are 70% more likely to convert.
Some brands say they manage their budgets through the holiday season by dividing campaigns into standard and retargeting ads.
“The strategy for a lower Instagram ad spend during the holidays is to start advertising early, then retarget the audiences at a lower cost as the holidays draw nearer,” said Brogan Renshaw, director of Modelers Central.
“Ad spend during the holidays becomes more expensive because of the heightened competition and increasing traffic,” Renshaw continued. “The way to circumvent the skyrocketing holiday Instagram ad spend is to start advertising before the height of the holiday traffic, so you can then save costs by only retargeting audiences instead of having to acquire new prospects.”
All About Gardening’s CEO, Jason White, has a similar approach. He and his team “start a month before the designated holiday and allot 80% of my ad spend on prospecting, then the rest into retargeted ads.”
“The final week of my Instagram holiday advertising strategy ends with 30% of my ad spend on prospecting and 70% on retargeting,” said White. “This is to maximize the opportunity to convert warm audiences to actual sales.”
2. A/B test in advance
There’s nothing worse than October rolling around and realizing your festive Instagram advertising campaigns aren’t ready yet. You’ll scramble to put things together and potentially waste money on campaigns that don’t acquire your target customers.
Regardless of which important date you’re preparing for, test your Instagram advertising campaigns in advance. Leave a few months to run A/B tests on:
- Bidding strategies. Test whether spend-based, goal-based, or manual bidding garners better results for your campaign goal.
- Ad creatives. Do ads with emojis have a better cost per click (CPC) than those without? Test whether other creative elements like stock vs. user-generated image and long-form text have the same impact. Build an internal list of Instagram advertising best practices and run with it during the holiday campaign.
- Ad targeting. Test whether Instagram users with different interests, languages, or locations drive better ROI.
- Ad formats. Videos, single images, carousels, the list of potential Instagram ad placements go on. Test to see whether one format performs better than another. Instagram video ads, for example, might attract your audience’s attention more than standard feed ads.
- Placements. To fine-tune your budget strategy when the important date rolls around, use the Placement report to analyze how well each performed — including Stories, the Explore page, feed, and collection ads. Don’t waste precious ad spend on Instagram placements that don’t drive results.
“Advertisements that run between Instagram Stories are currently less expensive than ads that run in the main Instagram feed. Selecting that form of ad would be an obvious decision if you’re targeting a group that engages effectively with the Stories feature, and it could help you save money on Instagram advertising.”
Tanner Arnold, president and CEO at Revelation Machinery
3. Use Instagram automation
There’s no such thing as the perfect Instagram ad, especially if you define a “perfect campaign” as 100% of the target audience completes the desired campaign objective. Instagram users can swerve a purchase for various reasons: They don’t know enough about the brand; the price is unclear; delivery options don’t suit them … the list goes on.
Help shoppers overcome these obstacles and purchase through your festive Instagram ads with automation. Use Instagram Automation by ManyChat to engage people via direct message (DM) through:
- Default Replies. Prevent people from being put off from a blank DM with this feature. Give users various options, such as “help with purchase,” “see available deals,” or “check stock availability.” Each gives an immediate automated response, relieving pressure from your customer service team during busy periods.
- Keyword triggers. In your ad, nudge people who aren’t ready to buy towards your Instagram DMs. Ask them to send a message with a specific keyword (e.g., “DEALS”), and create an automated response with a secret coupon code. Top it off with a direct link to redeem it.
- Lead magnets. If they’re still not ready to buy, follow up your conversation with a lead magnet, such as a free e-book, webinar, or cheatsheet. Ask for their email address in exchange for the lead magnet. Use this newly acquired information for future retargeting as the date approaches.
Read more: How Instagram Automation Can Make the Holidays Easier
Start preparing bids and budgets for important dates today
As you can see, there is no “best practice” for setting Instagram bids and budgeting strategies around important dates. Much of it is trial and error and looking through historical data to see what’s worked for your business before.
But one thing is clear: Retargeting and automation both help businesses maximize whatever budget they’re spending on Instagram ads. With retargeting and automation, reach people who already know what you have to offer but need a reminder; appeasing any objections they may have prior to purchasing by answering FAQs automatically.
