Instagram Ads vs Facebook Ads: Which Works Better for Local Businesses?

At Lillian Purge, we specialise in Local SEO Services and have produced a comparative guide on Instagram Ads vs Facebook Ads: which works better for local businesses? so you can make informed, cost-effective campaign choices.

Choosing between Instagram and Facebook Ads depends on who you want to reach, how you want to engage them, and what your local marketing objectives are. Both platforms share the same ad management system, meaning they can run together from a single campaign, but they attract different user behaviours and expectations. Understanding the strengths and limitations of each helps you decide where to focus your budget for the highest return.

Understanding Facebook Ads

Facebook Ads remain one of the most versatile and data-driven advertising platforms available to local businesses. With detailed targeting options, you can reach users based on age, location, interests, and behaviours. For small local businesses, this means the ability to connect directly with people who live or work within a specific radius.

Facebook offers several ad formats including image, video, carousel, and lead ads, all of which can appear across feeds, stories, messenger, and the audience network. This flexibility makes Facebook particularly effective for businesses that want to build brand awareness, generate leads, or drive traffic to a website.

Why Facebook Ads Work for Local Businesses

1. Advanced Targeting Options: Facebook allows hyper-local targeting, letting you narrow your audience to specific postcodes or areas around your business.

2. Community Engagement: The platform’s structure encourages sharing, commenting, and tagging, helping local businesses grow organically alongside paid campaigns.

3. Lead Generation: Facebook’s lead forms enable users to submit their details without leaving the app, ideal for service-based businesses such as salons, gyms, and trades.

4. Retargeting Capability: You can retarget website visitors or people who have interacted with your posts, increasing conversion rates.

For many local businesses, Facebook Ads act as the foundation of their paid marketing strategy, driving visibility and engagement within a defined local area.

Understanding Instagram Ads

Instagram Ads, although managed through the same Meta platform, cater to a more visual and lifestyle-driven audience. It’s particularly powerful for brands that rely on aesthetics, inspiration, or emotional appeal.

Instagram offers placements in the feed, stories, reels, and explore tab, all designed for immersive mobile experiences. Its user base skews younger than Facebook’s, and engagement rates are often higher due to the platform’s visual nature.

Why Instagram Ads Work for Local Businesses

1. Visual Branding: Ideal for businesses that sell products or services that can be showcased visually such as restaurants, boutiques, fitness studios, or beauty salons.

2. High Engagement Rates: Instagram users interact more frequently with brands, especially through stories, reels, and carousel posts.

3. Story and Reel Ads: These full-screen ad formats create immersive experiences that help local brands connect emotionally with nearby audiences.

4. Influencer Integration: Local influencers or micro-creators can amplify visibility within a specific community.

For visually focused local businesses, Instagram provides a strong branding platform that complements or enhances Facebook’s data-driven targeting.

Audience Comparison

Facebook and Instagram attract different demographics and usage patterns.

• Facebook’s Audience: Broader and older, ideal for reaching households, families, and local professionals. It’s perfect for service-based businesses like home improvements, education, finance, and healthcare.

• Instagram’s Audience: Younger, trend-conscious, and visually driven. It’s best for consumer products, food, fashion, events, and lifestyle services.

If your target audience includes homeowners aged 35 and above, Facebook tends to perform better. If you want to attract younger audiences such as students or millennials looking for local experiences, Instagram usually delivers higher engagement.

Ad Formats and Creative Considerations

While both platforms share similar ad objectives, presentation matters.

• Facebook Ads: Better suited to informative and community-based messages. Use a mix of text and visuals to explain offers, events, or services.

• Instagram Ads: Perform best when visually appealing with minimal text. Use bright, high-quality imagery or short video clips to stand out.

For best results, tailor your creatives to each platform rather than using the same design everywhere. A static product shot might work on Facebook, but a short lifestyle video might outperform it on Instagram.

Measuring Local Ad Performance

Both platforms provide in-depth analytics through Meta Ads Manager, allowing you to track impressions, reach, clicks, and conversions. However, for local businesses, specific metrics carry more weight:

• Store Visits: Track how many users visit your location after viewing your ad.

• Calls and Messages: Measure direct engagement actions such as phone calls or Facebook Messenger enquiries.

• Directions and Map Clicks: Evaluate how many people clicked to get directions to your business.

• Post Engagement: Indicates local awareness and brand familiarity.

By reviewing these metrics regularly, you can identify which platform delivers stronger engagement and leads within your target area.

Budget and Cost Efficiency

In terms of advertising cost, Facebook typically offers a lower cost per click (CPC) and broader reach, while Instagram often achieves higher engagement but at a slightly higher cost per impression (CPM).

For local businesses on a modest budget, starting with Facebook may deliver faster measurable results. Once a base audience is established, expanding onto Instagram can help strengthen brand awareness and loyalty.

Combining both platforms often produces the best outcome. You can run joint campaigns that share audiences but customise creative assets for each platform. For example, Facebook can handle awareness and lead generation, while Instagram focuses on branding and visual storytelling.

Challenges of Each Platform

While both networks are powerful, they each come with challenges.

• Facebook: Declining organic reach and high competition mean that consistent ad spend and creative refreshes are necessary.

• Instagram: Requires visually strong content and regular posting to stay relevant. Ads that look too sales-driven often underperform.

Understanding these limitations helps shape your strategy to maximise ROI rather than waste ad spend.

When to Use Facebook Ads Over Instagram Ads

Facebook Ads are ideal when:

• Your audience is older or family-oriented.

• You want to promote events, services, or special offers.

• You need form-based lead generation.

• You rely on text-heavy creatives that explain value.

Service industries such as local accountants, builders, estate agents, and fitness clubs tend to perform best here.

When to Use Instagram Ads Over Facebook Ads

Instagram Ads are best when:

• You have visually engaging products or services.

• You want to reach a younger, image-focused demographic.

• You rely heavily on branding, storytelling, or lifestyle appeal.

• You plan to collaborate with influencers or content creators.

Restaurants, clothing boutiques, salons, and creative studios usually achieve higher engagement on Instagram.

Combining Both Platforms for Maximum Impact

Rather than choosing one over the other, local businesses benefit most by integrating both. Running multi-platform campaigns lets you build awareness on Facebook while driving visual engagement through Instagram. The shared Meta platform ensures consistent tracking and optimisation across both, allowing data from one to improve performance on the other.

You can use retargeting to great effect for instance, showing Instagram ads to people who engaged with your Facebook posts or vice versa. This dual-channel approach builds familiarity and drives stronger conversions over time.

Expert Tips for Local Ad Success

1. Test both platforms initially to identify where your audience is most responsive.

2. Adjust creatives to match platform style visual storytelling for Instagram and informative value-driven content for Facebook.

3. Use geotargeting to ensure ads reach nearby users only.

4. Monitor ad frequency to avoid fatigue.

5. Review results weekly and shift budgets toward the platform that provides better local conversions.

Final Thoughts

There’s no single answer to whether Instagram or Facebook Ads work better for local businesses. The right choice depends on your audience, brand personality, and campaign goals. Facebook often leads in conversions and affordability, while Instagram shines in visual engagement and brand awareness. For most local businesses, combining both platforms delivers the best results Facebook to capture leads and Instagram to inspire customers and strengthen brand connection.

We have also written in depth articles on How to use hashtags to boost local reach on Instagram and The best types of posts for small businesses on Instagram as well as our Instagram Hub to give you further guidance.