Target Local Customers with Instagram Ads

At Lillian Purge, we specialise in Local SEO Services and share strategic guidance on How to target local customers with Instagram Ads, empowering you to grow awareness and connect with audiences in your community.

Instagram is one of the most location-aware social platforms available. With over a billion active users and deep integration with Facebook’s Meta Ads system, it offers advanced targeting options that allow businesses to focus specifically on people within their local area.

For small and medium-sized companies, this means you can compete effectively with larger brands by running cost-efficient campaigns focused on your community. Instagram Ads help:

• Increase visibility among nearby customers.

• Promote local events, offers, and services.

• Drive foot traffic to your store or office.

• Build awareness through local hashtags and geotags.

• Generate leads directly from within the app.

When combined with a strong local SEO strategy, Instagram Ads can create a powerful ecosystem that reinforces your brand both on search and social.

How Instagram Ads targeting works

Instagram Ads use Meta’s advertising platform, which lets you define exactly who sees your content based on demographics, location, and interests. When setting up a campaign, you can target:

1. Specific locations – Choose cities, towns, postcodes, or even a radius around your business address.

2. Demographics – Filter by age, gender, and language to reach your ideal local audience.

3. Interests and behaviours – Target users based on their activities, pages they follow, or topics they engage with.

4. Custom audiences – Upload your customer list or target people who have visited your website.

5. Lookalike audiences – Reach new users who share traits with your existing customers.

This flexibility allows you to build highly localised campaigns that reach people who are most likely to engage and convert.

Setting up a local Instagram Ad campaign

Running a successful Instagram campaign requires clear objectives and well-structured targeting. Follow these key steps to get started.

1. Define your campaign goal

Instagram offers several advertising objectives under categories such as Awareness, Traffic, Engagement, and Conversions. For local campaigns, the most effective goals usually include:

• Reach – Maximise how many local people see your ad.

• Traffic – Drive visits to your website or landing page.

• Messages – Encourage direct messages or enquiries from nearby users.

• Store visits – Promote physical visits to your shop or premises.

Choosing the right objective helps Instagram optimise delivery for your desired outcome.

2. Set location-based targeting

In the Ads Manager, go to the “Audience” section and select the geographic area you want to reach. You can target by:

• Address radius – For example, show ads to people within 5 miles of your business.

• Postcode or town – Perfect for businesses serving defined local areas.

• Multiple areas – Ideal if your services cover neighbouring towns or regions.

Make sure your targeting reflects your service area. For example, a Bedford-based hair salon could target users in Bedford, Kempston, and Bromham.

3. Create engaging visuals and captions

Local audiences respond best to ads that feel authentic and relevant. Use high-quality photos or short videos that showcase your products, people, or local community. Highlight what makes your business unique to the area.

For example:

• Feature your staff at recognisable local landmarks.

• Mention neighbourhood names in your captions.

• Include limited-time local offers, such as “10% off for Bedford customers this weekend.”

Authenticity and community connection often outperform generic corporate-style ads.

4. Add a clear call to action

Every Instagram Ad should encourage the viewer to take a next step. Depending on your campaign goal, this could be:

• Visiting your website or booking page.

• Sending a message or calling your business.

• Visiting your physical location.

Use direct phrases such as “Book your appointment today” or “Visit us in Bedford High Street.” Clarity and urgency help improve conversion rates.

5. Choose ad placements

By default, Meta places your ads across both Instagram and Facebook. For purely local audiences, you may wish to focus on Instagram Feed, Stories, and Reels placements, which are highly visual and effective for brand awareness.

You can also test different placements to see where your audience engages most, then allocate more budget to those performing better.

6. Monitor and optimise performance

Once your campaign is live, track key performance metrics through Ads Manager. Pay attention to:

• Reach – How many local users saw your ad.

• Engagement rate – Likes, shares, and comments that show audience interest.

• Click-through rate (CTR) – How many people clicked through to your website or landing page.

• Cost per result – Helps assess ROI and identify where adjustments may be needed.

If engagement is low, test new creative formats or refine your location targeting. Regular optimisation ensures your ads continue delivering results efficiently.

Advanced strategies for targeting local customers

Once you’re comfortable with basic campaign setup, there are several advanced techniques that can make your Instagram Ads even more effective.

1. Use local awareness ads

Instagram’s “Local Awareness” objective is designed specifically to help brick-and-mortar businesses attract nearby customers. These ads show people where your business is located and include clickable directions or contact buttons.

2. Leverage retargeting

Set up a retargeting campaign to reach people who have previously interacted with your business   for example, website visitors or users who engaged with your Instagram profile. Retargeting keeps your brand top of mind and increases conversion rates.

3. Promote user-generated content

Encourage local customers to tag your business or use a branded hashtag. You can then feature this content in your ads, building social proof and trust. People are more likely to engage with ads that show real community members.

4. Combine Instagram Ads with local SEO

Running ads alone builds visibility, but pairing them with strong local SEO creates sustained growth. While ads generate immediate awareness, local SEO ensures ongoing organic discovery through Google Maps and search results. This combined approach maximises both short-term and long-term reach.

Measuring success

To assess the effectiveness of your local Instagram Ads, focus on metrics that align with your business goals. For example:

• Increased website traffic from local visitors.

• More enquiries or message conversions.

• Higher footfall or event attendance.

• Growth in followers from your area.

You can track local conversions using Meta’s tracking tools or by adding UTM parameters to your URLs for analysis in Google Analytics.

Common mistakes to avoid

• Targeting too wide an area and wasting budget on irrelevant audiences.

• Using generic visuals that don’t reflect your local identity.

• Ignoring engagement by failing to reply to messages or comments.

• Running ads without testing or optimisation.

Avoiding these pitfalls ensures your ad spend delivers measurable impact.

Expert advice

The most successful local campaigns on Instagram balance personal connection with precision targeting. Businesses that combine community-focused content, consistent branding, and smart audience segmentation see stronger engagement and better returns.

It’s also essential to test different ad formats   such as Stories, Reels, and Carousel Ads   to find what resonates most with your audience. Over time, you can refine your campaigns to focus on the creatives, messages, and demographics that deliver the best results.

Conclusion

Instagram Ads are a powerful tool for targeting local customers and strengthening your brand presence in your area. By using precise location targeting, authentic visuals, and strategic optimisation, businesses can attract more local attention and convert social engagement into real-world growth. When combined with a well-structured local SEO strategy, Instagram Ads can help your business dominate both search and social within your community.

We have also written in depth articles on How to measure ROI from Instagram campaigns and How to use hashtags to boost local reach on Instagram as well as our Instagram Hub to give you further guidance.