Unlocking the Potential of Instacart Ads: A Complete Guide to Driving Brand Growth

Discover how to maximize your brand’s potential with Instacart Ads. In this guide, we’ll explore strategies to optimize your campaigns and leverage Instacart’s unique platform for sustainable growth.

The Rise of Instacart as a Retail Media Network (RMN) and the Opportunity Ahead

Retail media networks (RMNs) have changed the way brands engage with shoppers online, offering targeted, data-driven advertising at the point of purchase. By 2026, retail media is expected to account for 25% of all brand marketing spend.

Grocery e-commerce, accelerated by the pandemic, continues to thrive. By 2027, it could represent up to 35% of total grocery sales. Instacart, a leader in this space, has grown from a grocery delivery service to one of the most prominent RMNs, connecting brands with millions of shoppers across 85,000 stores in North America. With 85% of retailers on board and estimates that 90% of Instacart shoppers are incremental to in-store, this platform presents a massive opportunity for brands looking to grow.

Compared to major players like Amazon and Walmart, Instacart offers a more cost-effective way to break into retail media, thanks to less competitive keyword bidding. This makes it easier for smaller brands to gain visibility and connect with new customers. And Instacart isn’t just for groceries anymore—they now partner with major retailers like Sephora and PetCo, making their ad offerings available to a wider range of industries.

Understanding Instacart’s Ad Formats

Launched in 2020, Instacart’s self-serve Ads Manager allows brands to create campaigns, leverage first-party data, and monitor performance in real time. Instacart offers a variety of ad types to engage consumers throughout their shopping journey:

Sponsored Product Ads

Sponsored Product Ads are the most popular and effective ad format on Instacart. They operate similarly to search ads on platforms like Amazon and Google, using a keyword bidding model. When shoppers search for specific products, the winning ads appear at the top of search results, tagged as “sponsored.” This cost-per-click (CPC) model ensures that you only pay when a shopper engages with your ad.

In addition to search results, Sponsored Product Ads can appear in high-visibility areas such as department pages, the home page, and even on competitor product listings. Their seamless integration into the shopping experience often leads to higher engagement rates.

When setting up a campaign, you can choose between a Daily Budget or Max Impressions strategy. The daily budget option allows Instacart to pace your ad spend to a specified daily target, averaging spend over the course of the month. This means Instacart may spend more on high-traffic days and less on slower days to optimize your budget. The Max Impressions option focuses on getting as many views as possible, participating in all relevant auctions for ad placements.

For bidding strategies, you can opt for Optimized Bidding, where Instacart’s algorithm adjusts bids to maximize sales while considering your budget and target ROAS, or Manual Bidding, where you maintain full control over the bids based on a ‘bid landscape’ Instacart provides.

A unique feature of Instacart’s Sponsored Product Ads is the Impulse Purchase option. This allows brands with items priced under $7 to promote single-unit products as impulse buys, a tactic reminiscent of in-store checkouts.

Display Ads

Instacart’s Display Ads offer visually engaging placements throughout the shopping journey, targeting shoppers based on behaviors or keywords. These ads are sold via a first-price auction model with CPM (cost-per-thousand-impressions) bidding. Instacart classifies their display ads into three different ad types:

Shoppable Display Ads feature creative images paired with a product carousel and allow users to add products directly to their carts. These ads can appear at various touch points across the shopping experience, such as department or aisle pages, enhancing engagement with minimal disruption.

For the best performance, ensure your Shoppable Display Ad’s messaging aligns with your landing page and prioritize your top-selling or most available products to maximize conversions. Consider including various product flavors, sizes, or options to increase retailer availability and shopper interest.

Shoppable Video Ads are another highly effective format, combining autoplay video content with a product carousel. This format encourages interaction, allowing consumers to easily add items to their cart while watching your video.

Like with Shoppable Display Ads, pinning your top-performing products can increase their likelihood of being added to the cart.

Banner Display Ads, visually appealing images linked to customizable landing pages can capture impressions on various touch points throughout the shopper’s browsing journey.

You can choose from two pacing options for your display campaigns: Distributed Spend, where the budget is spread across the campaign’s duration, or Accelerated Spend, which focuses on spending your budget as quickly as possible to reach maximum shoppers.

Pages

Instacart Pages serve as customizable brand destinations where you can showcase your products and campaigns. These pages can include lifestyle images, banners, product carousels, and more, offering an immersive experience for shoppers.

Your Instacart Page can function as a branded "homepage" or a campaign-specific landing page. The beauty of Pages is their versatility—you can link to them from both your Instacart ads and external platforms like your website or social media, driving traffic from multiple sources.

Brands can choose between Evergreen or Seasonal pages. Evergreen Pages focus on your best-selling products and are designed for year-round engagement. Seasonal Pages allow you to promote limited-time offerings or special collections, aligning with key shopping moments throughout the year.

Some best practices for creating Pages:

Group products by consumer needs, such as dietary preferences or subcategories.
Ensure your collection titles match the theme or use case.
List hero products or high-priority items near the top for visibility.
Pages can feature up to 250 UPCs, so make sure you're prioritizing the most relevant products.

Product Collections

When setting up Product Collections on your Instacart Page, consider grouping items based on customer needs. This can range from dietary preferences (e.g., gluten-free or organic) to pack sizes or product subcategories. Creating collections that align with how customers naturally shop can increase engagement and conversions.

Titles for each collection should clearly communicate the theme or need they address, helping customers quickly find what they’re looking for. Additionally, placing your best-selling or hero products at the top of these collections ensures they get the visibility they deserve.

Coupons and Promotions

Instacart’s coupons and promotions tools, such as coupons for free delivery offers, help brands convert browsers into buyers. These incentives can be powerful motivators that drive conversions and increase average order value.

How Ads Can be Used Across the Customer Journey

Instacart Ads can support every stage of the customer journey, from building awareness to driving conversions and each ad type can be utilized to help a specific portion of the customer journey.

Awareness: Use Display Ads, Shoppable Video Ads, or Shoppable Display Ads to introduce your brand and increase visibility.
Consideration: Keep your brand top-of-mind with engaging, direct-response ads like Shoppable Display or Video, which allow consumers to add products to their cart instantly.
Conversion: Sponsored Product Ads are perfect when shoppers are ready to make a purchase. Offering coupons or "stock up and save" promotions can further incentivize buyers.

Maximizing Your Campaigns for Growth

To truly unlock the potential of Instacart Ads, brands need to adopt a strategic, data-driven approach. Here are some key tactics to ensure your campaigns perform at their best:

1. Pick the Right Products to Advertise

When getting started with Instacart Ads, it’s essential to focus on your core products—items that may have a proven track record on other retail media networks like Amazon or Walmart. These are the products that are likely to resonate well with shoppers and generate strong sales on Instacart too.

Once these products have established a strong presence and sales history, you can expand by adding more offerings to your campaigns. Experimenting with different products widens your sales opportunities and helps you capture a broader audience.

2. Test & Learn

Testing is crucial to long-term success on Instacart. Brands that continually test and refine their strategies will find the most success. Start by expanding your keyword list. Instacart allows up to 1,000 keywords per ad group, so you have plenty of room to try out a variety of terms—some that focus on profitability, and others that help drive new customers.

In addition to keyword testing, A/B testing your creative elements (product images, titles, descriptions, and promotions) can reveal what resonates most with your target audience. For example, you may find that a different product image leads to higher click-through rates, or that a new promotion generates more conversions. By continuously testing and optimizing, you’ll improve ad performance over time.

3. Closely Monitor Performance Metrics

Tracking performance is vital to understanding what’s working and where you need to adjust. Keep an eye on key performance indicators (KPIs) like Click-Through Rate (CTR), Return on Ad Spend (ROAS), Impressions, and Conversion Rates. These metrics give insight into how effectively your ads are driving traffic and sales.

Instacart’s Ads Manager offers detailed reporting, allowing you to monitor your campaign’s performance in real time. But there’s more to Instacart’s reporting tools. In addition to standard KPIs, Instacart provides unique insights such as Sales & Market Share data, as well as Customer & Basket Share data. These insights allow you to see how your brand is performing within specific categories and how consumers are interacting with your products in relation to their overall shopping experience.

For brands that spend more than $10,000 per quarter on ads, Instacart unlocks access to advanced reporting metrics like Regional Sales and Weekly Performance Metrics. This deeper level of data can help you fine-tune your strategy even further and identify growth opportunities that may have been overlooked.

4. Continually Optimize Campaigns

Success on Instacart requires ongoing optimization. To stay ahead of competitors, you’ll need to consistently refresh your product images, update your listings, and ensure that you have as much UPC coverage as possible.

Regularly revisit your campaigns to ensure they’re meeting your goals at each stage of the purchase funnel. Whether you’re focusing on brand awareness, consideration, or conversion, optimizing your campaign setup, ad creative, and keyword targeting will help you maintain momentum and stay competitive in your category.

Another critical element to keep in mind is maintaining a full-funnel approach. It’s important to engage customers at every stage of their shopping journey—whether they’re just discovering your brand, considering their options, or ready to make a purchase. A balanced approach that uses different ad formats (Sponsored Product Ads, Display Ads, Shoppable Video Ads) will help you reach consumers at all points in the funnel, ensuring maximum visibility and engagement.

Ready to Launch Your First Campaign?

Instacart Ads offer an exciting opportunity to grow your brand, but it’s just one piece of the retail media puzzle. At Forum Retail Media, we specialize in helping brands navigate retail media networks like Instacart, providing actionable insights and tailored strategies for long-term growth.

If you're ready to unlock the full potential of retail media for your brand, schedule a call with us today. Let’s partner to grow your brand, not just on Instacart, but across the entire retail media landscape!