ROAS offers insights into the true performance of your ad campaigns. Some of the key benefits that you can expect include:<\/p>\n\n\n\n
- \n
- You can find out if the marketing channel you chose is actually providing a return on your investments.<\/li>\n\n\n\n
- When you know which channels provide you with the best returns, you can invest in the proper areas and get returns.<\/li>\n\n\n\n
- By assessing the campaign performance, you can find out the kind of creatives, targeting parameters, and messaging that work.<\/li>\n\n\n\n
- ROAS demonstrates how successful your ad campaigns are, which can help you report to the stakeholders.<\/li>\n<\/ul>\n\n\n\n
<\/span>How is ROAS different from ROI?<\/strong><\/span><\/h2>\n\n\n\n
ROI is the measure of revenue that was generated in terms of the total investment that includes production cost, operating expenses, and so on. <\/p>\n\n\n\n
But ROAS, on the other hand, only calculates revenue in terms of the amount of money you spent on the ads. This is why it is a better measure to calculate whether your ads are generating a profit.<\/p>\n\n\n
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<\/figure>\n\n<\/div>\n<\/div>\n\n\n<\/span>How to Calculate ROAS for Instagram Ads<\/strong><\/span><\/h2>\n\n\n\n
Here is how you calculate ROAS for Instagram Ads to ensure maximum profits.<\/p>\n\n\n\n
ROAS is the revenue generated on your ad campaign divided by the cost of the campaign. For example, if your company has spent $1000 on an ad campaign and generated $6000 in revenue, the ROAS is $6.<\/p>\n\n\n
\n![\"Formula](\"https:\/\/predis.ai\/resources\/wp-content\/uploads\/2024\/06\/5-2.png\")
<\/figure><\/div>\n\n\n<\/p>\n\n\n\n
The results you get are in dollars to understand if your brand is making a profit. In the above example, you can also consider it as a ratio of 6:1 to check if the revenue is greater than the investment.<\/p>\n\n\n\n
This calculation tells you about the clicks that are actually turning into conversions. If your company has a high CTR (click-through rate) but low conversion rates(CvR), you get an idea about what to do to increase conversions.<\/p>\n\n\n\n
Common Mistakes that can occur<\/strong><\/h3>\n\n\n\n
Of course, some mistakes are common when ROAS calculation is done. Look out for the following the next time you calculate it:<\/p>\n\n\n\n
- \n
- Are you attributing the conversion to the right channel? Sometimes your Instagram ad could have been their last touchpoint. By attributing the conversion to only this channel, you are totally missing out.<\/li>\n\n\n\n
- Bidding on branded keywords can skew your ROAS calculation. So, instead, you should measure the ROAS of non-branded keywords.<\/li>\n<\/ul>\n\n\n\n
<\/span>Key Factors that Influence ROAS of Instagram Ads<\/strong><\/span><\/h2>\n\n\n\n
Many factors can contribute to the ROAS of Instagram ads, some of the following include:<\/p>\n\n\n\n
- \n
- Average order value:<\/strong> If your product is a high-value one, then the average order value of each purchase increases. This directly impacts ROAS and can boost it tremendously.<\/li>\n\n\n\n
- Customer Lifetime Value<\/strong>: If your product is something that needs to be repeatedly purchased, then the lifetime value of the customer can easily offset the customer acquisition cost. But if it is a one-time purchase product, then this may not be sufficient unless it is a high-value product.<\/li>\n\n\n\n
- Marketing channel:<\/strong> Each channels have their own ROAS expectations. While Google search can provide high yields, Meta ads might not work as well, but has other benefits.<\/li>\n\n\n\n
- Proper audience segmentation:<\/strong> If you are targeting an irrelevant audience, then you will not get conversions, which will impact ROI.<\/li>\n\n\n\n
- Ad fatigue:<\/strong> If you have limited creatives and use them repeatedly, then your audience will experience ad fatigue. As a result, they will not convert, which again is an issue for your ROAS.<\/li>\n\n\n\n
- Not aligning the ad with the landing page:<\/strong> When your ads do not align with the landing page, it can confuse users about what your offer is.<\/li>\n\n\n\n
- Unclear CTA:<\/strong> CTAs are what drive the conversions, as we all know. If it is not clear and easy for the users to follow, then they will not click.<\/li>\n\n\n\n
- Slow page loading:<\/strong> If your users are clicking on the ads and going to your landing page, then they expect the page to load fast. If it doesn’t, then they will bounce.<\/li>\n<\/ul>\n\n\n\n
<\/span>What is a Good ROAS for Instagram Ads?<\/strong><\/span><\/h2>\n\n\n\n
Every industry has a different ROAS, and it is safe to say that there is not one single ROAS for Instagram ads that works well for everyone. However, generally speaking, the average ROAS for most industries is around 3:1.<\/p>\n\n\n\n
The best deal for any company comes to around 4:1, where the profits are adequate, and the ad campaign can look into future ad campaigns to grow the company. The ROAS can go up to 7:1 or even higher if the ad campaign goes smoothly.<\/p>\n\n\n\n
The average ROAS of Instagram ads is 8.83<\/a>, which is a good number for sales and an adequate amount to invest in future campaigns.<\/p>\n\n\n
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\n\n<\/figure>\n\n<\/div>\n<\/div>\n\n\n<\/span>How to Increase ROAS for Instagram Ads<\/strong><\/span><\/h2>\n\n\n\n
<\/p>\n\n\n
\n![\"How](\"https:\/\/predis.ai\/resources\/wp-content\/uploads\/2025\/03\/img_1-71-1.png\")
<\/figure><\/div>\n\n\n<\/p>\n\n\n\n
Here are a few tricks and tips to increase your brand’s ROAS for Instagram ads to generate high profits.<\/p>\n\n\n\n
1. Lower Ad Costs<\/strong><\/h3>\n\n\n\n
The ROAS for Instagram ads consists of two components: the amount your company invests in an ad campaign and the revenue it generates on that amount. Understand the position of the sales funnel<\/a> that you want to optimize and use methods accordingly.<\/p>\n\n\n\n
If you want brand awareness, use methods that will help you gather a larger audience. But if your brand needs higher conversion rates, you may need to invest more in your ads. This understanding simplifies the advertising strategy, and you have a well-structured financial plan.<\/p>\n\n\n\n
A good way to save money on ads is to set up an automatic bidding system. With this bidding system, you never pay extra for your Instagram ads because you set an amount based on your precise needs.<\/p>\n\n\n\n
You can also consider other automatic processes, like automated ad placement, to save on ad costs. This system allows Instagram to place ads based on an algorithm for where your ads will work best on the platform.<\/p>\n\n\n\n
Jumpstart your business with the best ads with Predis.ai's Instagram Ad Maker<\/a> which creates ads for organic traffic. With one text input, you create content that enhances performance.<\/pre>\n\n\n\n
2. Retarget Existing Audience<\/strong><\/h3>\n\n\n\n
The probability of selling to an existing audience is 60%-70%<\/a>, while selling to a new audience is 5%-20%. This shows how powerful customer retention is and how it can increase ROAS for Instagram ads<\/strong>.<\/p>\n\n\n\n
Thus, marketers now focus on retargeting on Facebook and Instagram, making them the leading platforms for this practice. It helps re-engage users who already know about their brand and have already purchased from them earlier.<\/p>\n\n\n\n
Retargeting keeps the existing hooked and increases ROAS for Instagram ads because conversion rates spike <\/a>tremendously. All you need to do is create a custom audience based on your account’s recent activity. For example, retarget consumers who have visited a product page in the last 30 days. <\/p>\n\n\n\n
You can use other methods like Lead Forms and Shopping for better retargeting to increase ROAS and remind customers about particular products. Consider a reward program that benefits consistent users of your brand to acknowledge their contribution.<\/p>\n\n\n\n
3. Use Strong Landing Pages<\/strong><\/h3>\n\n\n\n
Knowing about a brand and looking at its products is the first step in the conversion process. If you want the audience to follow through with the click and purchase from your brand, you must have a strong landing page that delivers, often supported by a virtual assistant agency<\/a> that helps execute and manage marketing initiatives efficiently.<\/p>\n\n\n\n
Landing pages need to deliver what they promise on Instagram so that your audience gets exactly what they need. If your landing page promises to show your audience ten high-rise jeans, the audience needs to see just that.<\/p>\n\n\n\n
Use straightforward landing pages so that the audience is not confused and can easily find products. Marketers face a 4.42% drop in conversion rates<\/a> with high loading time, so make sure you use optimized and fast landing pages.<\/p>\n\n\n\n
Invest in different types of landing pages to serve a specific purpose and help you increase ROAS for Instagram ads. Demo and consultation pages are the most popular ones at 42%<\/a>, followed by 24% of sign-up pages and 21% of lead magnet pages.<\/p>\n\n\n\n
Create high-value ad copies with Predis.ai's AI Ad Copy Generator<\/a> that converts in seconds. The brand generates copies tailormade specifically for your brand's requirements to keep the audience hooked.<\/pre>\n\n\n\n
4. Use Different Types of Ads<\/strong><\/h3>\n\n\n\n
Instagram is all about creativity, and using different types of advertisements can go a long way in generating high ROAS for Instagram ads<\/strong>. Reel ads are pretty engaging when used right.<\/p>\n\n\n\n
Reels from accounts with 10 thousand to 50 thousand followers reached 6,243 users on Instagram. Additionally, accounts with 50 thousand to 45 million followers reached 47,851 users across the platform.<\/p>\n\n\n
\n![\"Average](\"https:\/\/predis.ai\/resources\/wp-content\/uploads\/2024\/06\/1.png\")
<\/figure><\/div>\n\n\n<\/p>\n\n\n\n
Use other types of ads, like carousel ads<\/a>, to talk about your products in a detailed manner with several images or videos in one post. Carousels work better on Instagram by attracting a larger audience and increasing click-through rates.<\/p>\n\n\n\n
Carousel story ads are beneficial, too. One good example is the brand Lacoste, which received a two times increase<\/a> in online return on ad spend, compared to other ad formats. Other image ads, like Instagram Shopping ads, give high returns because they do not hamper the user’s scrolling experience.<\/p>\n\n\n\n
Around 44% of shoppers<\/a> use Instagram Shopping each week. These ads are best for showing your product catalogs to your users and increasing click-through rates. Understand the type of content that will work best for your brand and invest your time and effort accordingly.<\/p>\n\n\n\n
Create the best Instagram reel ads with the Predis.ai Free Reels Maker<\/a>. Discover amazing templates for every occasion and accelerate your reel ads to return maximum profits.<\/pre>\n\n\n\n
<\/span>Make the Most of Your Marketing with the Good ROAS for Instagram Ads<\/strong><\/span><\/h2>\n\n\n\n
Understanding ROAS for Instagram ads may be challenging, but things are easy with some research. A high ROAS ensures that your brand is reaching the right audience who are interested in investing in your company.<\/p>\n\n\n\n
Look at different ways to reduce ad costs and invest in methods to increase revenue. Recognize the pain points where your company is investing the most money and understand how you can address them to lower costs.<\/p>\n\n\n\n
Want help with the creative side of your ad campaigns? Predis.ai<\/a> is the solution to all your content creation needs. Generate ad content ideas with a few prompts and create engaging images and videos for increased reach. Use the different Predis.ai features<\/a> to create a strong marketing strategy for your company today!<\/p>\n\n\n\n
Check out different examples of Instagram ads<\/a>.<\/p>\n\n\n\n
<\/span>FAQ:<\/strong><\/span><\/h2>\n\n\n\n
- Customer Lifetime Value<\/strong>: If your product is something that needs to be repeatedly purchased, then the lifetime value of the customer can easily offset the customer acquisition cost. But if it is a one-time purchase product, then this may not be sufficient unless it is a high-value product.<\/li>\n\n\n\n
- Average order value:<\/strong> If your product is a high-value one, then the average order value of each purchase increases. This directly impacts ROAS and can boost it tremendously.<\/li>\n\n\n\n