Does advertising on Instagram work? Key Benefits and Best Practices

Why Instagram is a Must for Marketers in 2025? Instagram is a social media powerhouse with over 2 billion active monthly users, ranking third globally behind Meta and WhatsApp. Known for its visual-first platform, Instagram provides brands with vast reach and impactful marketing opportunities, constantly adapting to meet evolving digital marketing demands with advanced e-commerce tools and powerful visual storytelling. 

As the digital landscape rapidly shifts, keeping up with Instagram’s growth is crucial for businesses aiming to make meaningful connections with their audiences.

Do Instagram ads work? Instagram by Numbers

Before exploring Instagram’s benefits for advertisers, here are some key statistics:

• As of April 2024, almost 32% of global Instagram audiences were aged between 18 and 24 years, and 30.6% of users were aged between 25 and 34 years. Overall, 16% of users belonged to the 35 to 44 year age group.
• Instagram sets trends, especially among users aged 16–24.
• Ranks as the fourth most-visited website after Google, YouTube, and Meta.
• Industry engagement rates range from 1.44% to 2.31%.
• More than 50% of content viewed on Instagram is recommended by AI-driven algorithms.
• Instagram appeals to diverse demographics, including nearly equal gender-split users.
• 47% of U.S. teens use Instagram daily, with Gen Z logging in multiple times per day.

Reels, Business, and Ad Performance

• Reels now account for over half of the time spent on the platform.
• 68% of marketers report positive ROI from Instagram, with product tagging boosting sales by 37%.
• Instagram’s ad revenue comprises 9.8% of total U.S. digital ad spend.

Influencer Insights

• Influencers report an average of 2% engagement on affiliate links.
• Feed posts, Stories, and Reels are equally popular for influencer campaigns, with 98% of influencers leveraging each format.

Top 6 Benefits of Advertising on Instagram

• Reach a Massive Audience

Instagram’s extensive user base enables brands to connect with a diverse global audience. This broad reach, coupled with varied demographics and interests, allows companies of all sizes to pinpoint niche markets and grow their visibility on a worldwide scale.

•  Boost Brand Awareness

Instagram’s visual-centric format empowers brands to make lasting impressions. Ads featuring captivating visuals, engaging videos, and interactive stories can increase brand recall, attract followers, and strengthen your brand’s online presence. Over time, enhanced brand awareness builds loyalty and advocacy as audiences become more familiar with and trust your brand.

• High-Quality Advertising Targeting

Through Meta’s advanced algorithms, Instagram offers precise targeting options, enabling businesses to reach highly specific audience segments. Whether targeting fashion-savvy millennials, fitness enthusiasts, or foodies, Instagram allows brands to deliver relevant content to the right audience, optimizing ad spending for higher conversions.

• High Engagement Rates

Instagram boasts some of the highest engagement rates across social platforms, with users actively liking, sharing, and commenting on content that resonates with them. High engagement presents a golden opportunity for brands to strengthen connections with potential customers, boost brand visibility, and amplify word-of-mouth marketing.

•  A Mobile-First Advertising Powerhouse

Instagram’s mobile-first design ensures your ads are optimized for mobile viewing, meeting users where they are, anytime. This seamless accessibility boosts ad visibility and engagement, making your campaigns more impactful in today’s mobile-driven world.

• High Return on Ad Spend (ROAS)

Instagram ad ROAS varies by industry, with an average of 3:1. A strong ROAS is around 4:1, while top campaigns can reach 7:1 or higher. Instagram’s average ROAS is 8.83, delivering solid returns for immediate sales and future growth.

Instagram advertising best practices: Tips for a Successful Instagram Ad Campaign

Creating an effective Instagram ad campaign involves more than simply boosting posts. Follow these key strategies for maximizing your ROI:

• Define Clear Objectives and KPIs: Set measurable goals aligned with your business objectives, whether increasing brand awareness or driving sales. Define KPIs like click-through rates, conversion rates, and ROAS to track success.
• Ensure Photos and Videos Match Recommended Dimensions: Follow Instagram’s size and quality guidelines for all visuals to ensure a professional look and optimal display on any device. Check out our Top Creative Performance Insights!
• Keep It Simple: Instagram audiences respond best to clear, engaging, and visually appealing content. Skip the clickbait and prioritize clarity and impact.
• Add Strong CTAs: Use clear, compelling CTAs to guide your audience, encouraging actions like visiting your website or purchasing.
• Tell a Story with Your Product: Create an emotional connection by showing how your product fits into a desirable lifestyle through storytelling.
• Use User-Generated Content (UGC): Ads featuring people—especially faces—tend to perform well. Allocate the budget to UGC for authenticity and relatability.
• Maximize Timely Opportunities: Use announcements, promotions, and seasonal events to drive higher ROAS and engagement, boosting paid and organic content interest.
• Gain Insights from Competitor Ads: Analyze high-performing competitor ads to identify successful tactics and strengthen your strategy with tested, impactful content.

How to make Instagram ads that work? Top Instagram Ads of 2024

Madewell and summer

The image here is so vivid that “SUMMER” feels almost unnecessary. A stunning color palette makes the white text pop, seamlessly integrating the product into an aspirational lifestyle scene. These jeans are made for carefree beach strolls, and the ad’s simplicity cleverly taps into romance, allure, and a touch of FOMO.

Alo Yoga

This image ad features a young influencer in a relatable, everyday setting with an effortless, authentic style. The natural, unposed look builds trust and makes it easy for users to picture themselves in this “most-loved” style. Its simplicity and the influencer’s approachable appeal enhance credibility, making the ad resonate with audiences seeking genuine, accessible fashion.

Start Advertising on Instagram Today!

With its unmatched reach, high engagement rates, and visually dynamic format, Instagram remains a leading platform for brand growth and customer engagement. For businesses aiming to thrive in the digital age, Instagram advertising provides the scale and precision needed to reach the right audience, drive meaningful interactions, and achieve measurable results.

Need help with your Instagram Ads? Reach out to yellowHEAD!

This article was originally written in 2023 by Ron Vind