What started as a tool to add hipsteresque filters on pictures, turned into one of the fastest growing social media networks in the world!
In this guide, taken from my Complete Guide to Monetizing on Instagram, I’ll go into the details and walk you through examples of how to make money on Instagram.
I’ve been running the IncomeTips Instagram page since 2015 and with over 100k followers at the time (currently over 360k), the question of monetizing was important to ask if I was to devote my time to grow it further.
Over the years I’ve experimented with various monetization methods. I worked on projects with other Instagram influencers, created my own advertising deals, and paid close attention to what other accounts were doing. From that, I’ve been able to boil it all down to a few basic strategies for making money on Instagram.
Before I go into the details, let me explain why I believe Instagram is a platform every business owner or marketer should be paying attention to in 2019.
Why should I care about Instagram?
As of December 2017, Instagram has reported over 800 million users globally.
To put that into perspective, some of the most watched television networks in the U.S. get around 7 million views as of 2017.
That’s less the 1% of Instagram’s total user base.
The way I see it, Instagram is like all the television broadcast networks rolled into one. The big difference is that anyone with a mobile phone and internet access can create their own content for others to enjoy.
It’s nothing short of revolutionary.
This opens the gateway for anyone to advertise at pennies on the dollar compared to what broadcast networks charge advertisers for commercial spots.
This then leads to the all-important question…
How Can I Make Money on Instagram?
It takes creativity and work. 👈
Instagram doesn’t have an ad revenue share or sales platform to sell things directly to followers (yet).
Instagram is mostly a place for people to kill time, get a chuckle, follow friends, like posts, and upload photos.
It’s your job to think creatively on how you can grab attention to sell something.
3 Methods to Make Money on Instagram
There are 3 basic methods to make money on Instagram.
- Sell ads – also called sponsorships, shoutouts or promos.
- Sell a product or service
- Sell leads – CPA and PPD offers (I’ll explain more below)
How to Make Make Money by Sell Ads
Also known as selling shoutouts, this is one of the most common ways Instagrammers make money.
Going back to my example of Instagram being like a broadcast network, imagine your Instagram page like a TV show. Only, instead of the network keeping all the ad money, now you can advertise and keep the profits yourself.
For this to work, you’ll need to grow your own large following, or focus on finding a highly targeted audience in a narrow niche.
Once you have an audience, advertisers will be happy to pay you a fee to promote their product or service to your following if its a good match.
In some cases, people in the process of growing their own Instagram followers will pay you to post or mention their page to get more followers.
How Much Can I Make By Selling Shoutouts?
There’s no universal Instagram rule of what to charge or not to charge, so prices can be all over the board.
In general, what matters most is the number of impressions a post will get.
An impression is the placement of a post in front of people who scroll through their feed. It’s basically a representation of how many people happened to see your post.
The cost is often calculated by using a multiple of each one thousand impressions, known as a CPM (cost per mille).
The price range I’ve seen is typically around $5 per CPM and up on Instagram. Prices can go way beyond that depending on the quality of the audience or how famous the influencer is.
Using $5 as an example, if your post gets 10,000 impressions, you can charge a reasonable $50 for one 24 hour post.
The $250,000 Instagram post
Let’s do the math to calculate what Kim Kardashian’s CPM cost might have been using the above picture as an example. This won’t be totally accurate and is not to say Calvin Klein actually paid that much, but just to give you a better understanding of what I’m talking about, let’s go through this exercise.
If Kim has 100,000,000 followers (I’m rounding down), and we can see she received 2,800,000 likes for this post, we know for sure she received at least 2.8 million impressions. Her actual impressions will be much higher than her likes since not everyone who sees an image will like it. Based on my own Instagram account, I know impressions are usually more than 50% the number of likes. Its safe to say then that Kim received at the very least, double the number of likes as impressions.
That’s 5,600,000 impressions for one post.
Having received $250,000 for a post, we can use that number to figure out how much she costs per CPM.
($250,000 / 5,600,000) * 1000 = $44.64 CPM
$44 per CPM is insanely overpriced, but it might still be worth it for advertisers to pay for that level of exposure. She is one of the most famous people on earth after all.
An Influencer Marketplace
Websites like ShoutCart, allow influencers to post their pricing for anyone to buy a shoutout. You can get a good idea of what Instagram influencers are charging by visiting their website.
If you have an influencer page, this can be a good place to put your name out there to start generating some shoutout income. Be warned though; they charge 20%-30% on top of what you charge which is a bit steep in my opinion. They also don’t have the best customer support incase of issues.
Usually, advertisers looking to promote a product will hunt your account down and send you a direct message (DM) asking for your prices.
How to Make Money Selling Products or Services
Selling a product or service is the next best way to make money on Instagram in my humble opinion.
You’ll need a product or service to start with of course which can take time to figure out.
Once you have that, you’ll either need to grow an Instagram account to attract your potential buyers or you’ll need to buy shoutouts from Instagram accounts who already have potential buyers ( known as influencer marketing).
Let me show you some examples to give you a better idea of what you can do.
Selling Products with an Ecommerce Shop
Having an ecommerce store is one of the more practical ways on how to make money on Instagram.
I won’t go into the details of setting up a store and finding products here, but I will tell you that one of the best sites to learn it all is Ecom Empires. (Totally free BTW. You’re welcome 😉)
To sell a product, you’ll want to share a photo or video of the product on your feed. Then tell people to click over to your profile bio where they can find a link to your product.
Pet.awesome has over 500,000 followers. Their following is likely to have pets of course, which puts them in a perfect position to sell pet-related products.
By sharing a post about a product, their followers will see the item and might click over to their profile page to look at the offer.
This is why having a good Instagram profile page is critical for making sales. Your post needs to have a call to action, and your profile should explain to your followers what you offer.
A good landing page is also critical to make sales. There needs to be an incentive like a discount or limited time offer. You should also have testimonials and reviews to validate your product to wary customers.
This particular page can use some improvements but you can see it was done using Shopify which makes setting up a store very straightforward.
Selling services on Instagram
Selling service works the same as selling a product, but might require a bit more effort to develop a relationship with followers and to prove your expertise.
Truth excavation uses their Instagram page to develop their brand rather than make direct sales. They’ve been in business for years and have had loads of customer referrals by word of mouth. For them, Instagram is just a way to further establish themselves as the best excavation company in Hawaii.
By leveraging Instagram, they further expose their business to tens of thousands of new eyeballs outside of Hawaii.
They’ve also built a side revenue stream by selling merch. 👌
Strategies for Selling Your Services on Instagram
Here are some tips for you to leverage Instagram to sell your services.
Focus on branding and providing value
Use Instagram to demonstrate your expertise and to build a relationship with your audience. People don’t like being sold to, but if they start to like you and can clearly see you know your stuff, they’ll reach out to you.
Create content related to your niche and share content that would appeal to your ideal customer.
Have something free to offer
Use Instagram to collect warm leads.
To do that, you should have a free offer in place to collect emails.
Sales primarily come from email marketing rather than directly from Instagram so really focus on building up that email list.
Some possible freebie offers can be:
- Free 15-minute consultation
- An infographic that explains a solution to their problem
- A short ebook
- A webinar training
- An exclusive video explaining a solution to their problem
How to Make Money Selling Leads on Instagram
A lead is someone potentially interested in buying a product or service.
There are entire ad network paying marketers like yourself to bring them leads.
These are known as CPA (cost per action), and PPD (pay per download) offers.
What are CPA offers?
Cost per action offers are deals where advertisers pay you to convince people to take certain actions such as completing a survey or submitting their email address.
Joining a network like this can be tricky if you’re new since ad networks prefer people with experience.
My advice to you if you’d like to apply is to have a fairly large social media account and a website.
These networks have a large variety of offers for different niche types.
Everything from health and nutrition to business opportunities and giveaways.
How Can I Make Money with CPA Offers?
For this strategy, you don’t need to have an Instagram account. You can simply pay an influencer to promote your offer for you.
In this example, an account has been created purely to promote this particular giveaway offers which would pay out money for everyone who signs up.
You simply place the URL link given to you by the ad network in your profile. Then let people know about the giveaway and convince them to click the link in your bio.
What are PPD offers?
PPD stands for pay per download.
Much like CPA offers, pay per download networks pay you to get people to download an app.
One such ad network is The Plug
Upon joining, you’ll have access to various apps to promote.
The Plug gives you what they call Plug Coins which you redeem for USD to your PayPal account.
The beauty with PPD offers is often networks like The Plug will provide you with already made videos and images for you to simply upload to your Instagram page, then direct people to your affiliate link.
We have an ebook that goes over a strategy for making $150 a day using The Plug. We have discounts available if you send us a message.
Itunes also has an affiliate program you can sign up for. This is another way to make some money by promoting apps for download.
Strategies for Making Money on Instagram with CPA and PPD
Here are a few tips that can help you make more money with CPA and PPD offers.
Collect as many influencer accounts as you can in a spreadsheet
As we know, influencer prices can be all over the board. Keep track of everyone you contact including:
- Price per 24hour post
- Follower growth rate – Use IGBlade to see how quickly they grew their following. Note: If you see huge spikes and dives, its likely they have fake followers.
- Follower demographics
- Average engagement and activity – Consider using Wefind chrome extension to make this easier
Use Facebook Ads and Instagram Story Ads
Besides using influencers, try testing out your ads on Facebook ads and Instagram story ads.
The benefit of going this routes is that you get to target the exact person you want using different Ad Sets. Although Influencer marketing is great, its more of a scattershot approach since you can’t know for sure who will see your promo.
With Facebook, you can target only the people you want, for example, 18 – 24 Men living in Kentucky.
Learn from other marketers to improve your skills
This is key no matter what youre working on.
Although the strategies for monetizing are straight forward, actually getting them to work might not be as simple.
It takes time, knowledge of your ideal customer, constant work to provide quality content so you’re not just selling to people all the time, and of course patience.
If you have any questions or would like me to review your business to give you a solid Instagram Strategy, complete this form here and I’d be happy to help!