TikTok vs Instagram for Business: Which Is Best for ROI in 2025?

Choosing a social platform isn’t about chasing the latest trend – it’s about which channel turns ad spend into revenue. If you’re weighing TikTok against Instagram, the core question is which platform delivers a lower cost per purchase for your stage of growth.

TikTok’s discovery-first algorithm can push a brand-new product to millions for pennies, while Instagram’s broader demographics and deeper analytics favor companies with bigger budgets and more polished creative content. Choose poorly and you’ll overspend for the wrong eyeballs or miss the viral lift your competitors seize.

My side-by-side tests on CPM, conversion rate, and lifetime value reveal a clear pattern: small to mid-sized brands achieve faster and cheaper wins on TikTok. On the other hand, larger brands benefit from Instagram’s mature ad stack and layered retargeting capabilities.

Set up a test campaign with TikTok for Business now, or continue reading for the full data before you commit.

Features

Instagram Suits Established Brands; TikTok Benefits Small Businesses With Viral Potential

When deciding between TikTok and Instagram for your business, you must understand each platform’s unique features. While both platforms allow you to promote your business effortlessly, TikTok is ideal for brands targeting Gen Z, and Instagram lets you reach a broader demographic.

TikTok and Instagram offer many features that allow businesses to share content and promote their brands. These include:

Content Types

TikTok and Instagram both offer engaging content formats that you can use to promote your business or brand.

TikTok content formats:

• Videos: Videos spanning between 1 second and 10 minutes for engaging and often viral content
• Duet: Collaborative video created alongside another user’s video
• Stitch: Clipped or integrated scenes from another user’s video you can use in your own
• LIVE: Real-time video content where creators interact with viewers directly

Instagram content formats:

• Photos: High-quality single images or carousels (series of images)
• Videos: Posts in the main feed (up to 60 minutes) or Reels (up to 90 seconds)
• Stories: Temporary 24-hour content that can include images, videos, and various interactive elements like polls and quizzes
• Live: Live broadcasting to followers, often used for real-time engagement
• Reels: Quick, engaging videos set to music or other audio, similar to TikTok’s short videos

Algorithm

An important point to consider is how users unfamiliar with your brand will discover your content. Comparing the TikTok vs Instagram algorithm is key to determining which platform will provide the best discoverability.

TikTok’s algorithm is uniquely designed to rapidly learn user preferences through likes, shares, and viewing time interactions. It makes it easy to push content to a broad audience through its For You page, regardless of the creator’s number of followers. This feature significantly levels the playing field, allowing new and smaller businesses to achieve visibility alongside more established ones.

While robust in its targeting capabilities, Instagram primarily boosts content from accounts users already follow, supplemented by recommendations based on past interactions. This approach favors accounts with larger followings or those who can invest heavily in paid promotions to maintain visibility.

Analytics

TikTok and Instagram provide valuable insights that can guide your content and advertising strategy, but Instagram provides more detailed analytics tools than TikTok.

TikTok Analytics metrics:

• Follower growth: Growth of your follower base over time
• Video views: Number of views your videos receive
• Profile views: Number of users who visit your profile
• Content performance: Performance of individual videos in terms of views, likes, shares, and comments
• Audience demographics: Insights into the demographics of your audience, including age, gender, and location

Instagram Insights metrics:

• Follower demographics: Detailed demographic information about your followers, including age, gender, and location
• Engagement metrics: Metrics such as likes, comments, and shares for individual posts
• Content reach: Post reach and impression tracking to understand your posts’ visibility
• Website referral traffic: The Amount of traffic directed to your website from your Instagram profile
• Story analytics: Metrics related to your Instagram Stories, including views, replies, and exits

Social Marketing and Selling Tools

Both TikTok and Instagram provide tools for social commerce and advertising. To promote your products and get access to new customers, you can take advantage of some of these tools.

TikTok for Business:

• Auto Message: Welcome message or automated replies set up for customers
• TikTok Ads Manager: Range of ad formats, including in-feed ads, branded effects, and hashtag challenges
• TikTok Creator Marketplace: Influencer collaboration that enhances your reach through authentic, creator-driven content
• TikTok Shop: A Virtual storefront on TikTok, where followers can explore your products and purchase directly through the app

Instagram for Business:

• Instagram Insights: Comprehensive analytics tools to track engagement, reach, and the effectiveness of your posts and stories
• Instagram Shopping: Product catalog integrated into your business profile so customers can purchase products through posts, stories, and the dedicated shop tab
• Instagram Ads: Different post formats, such as photos, videos, and Stories, are turned into ads and target specific audience segments

Overall, Instagram’s features better serve established brands with bigger budgets to invest in high-quality images and videos. However, TikTok does it better because it allows small businesses and individuals to gain traction and visibility without needing a large budget or professional production quality. TikTok’s video-focused content formats and algorithm make it easier to go viral faster, even with little organic traffic.

Ease of Use

Navigating TikTok Is Simpler Than Feature-Rich Instagram

TikTok and Instagram are fairly easy to use. Both platforms adopt minimalistic designs so you can find your way around quickly. However, navigating Instagram can be overwhelming due to its content creation and analytics tools that support various content types, unlike TikTok, which primarily focuses on video content.

Creating and switching to a business account on TikTok is straightforward, requiring just a few taps in the app settings. On the other hand, setting up an Instagram business account may take longer due to the extra optional opt-in/out slides, although you can skip them. Additionally, creating a shop on TikTok requires creating a separate seller account, whereas you can use the same business account to set up a shop on Instagram.

Thanks to the helpful Overview, Content, Followers, and LIVE tabs at the top of the screen, TikTok’s analytics page is easier to navigate. In contrast, Instagram Insights doesn’t have tabs, and you need to scroll and tap the reach, engagement, and followers buttons to access the rest of the metrics.

Overall, while both platforms are designed to be user-friendly for businesses, TikTok offers the most user-friendly platform among the two. You can easily access the business tools and set up your marketing campaigns.

TikTok vs Instagram Statistics: Demographics, Reach, & Engagement

TikTok Skews Younger, While Instagram Appeals to a Broader Age Range

TikTok boasts around 1.6 billion monthly active users globally, with its largest user base in the United States (135.8 million users) (Statista, 2025). Instagram has a larger global audience, with over 2 billion monthly active users. India tops Instagram’s user base with 413.9 million users, followed by the United States with 171.7 million users (Statista, 2025).

While Instagram reaches a broader audience both globally and in the US, TikTok attracts a younger demographic. Around 30.7% of TikTok users (14.1% female, 16.6% male) fall within the 18–24 age range, while 35.3% (14.6% female, 20.7% male) are aged 25–34 (Statista, 2025). This makes TikTok great for brands targeting Gen Z and younger Millennials.

Instagram has a more evenly distributed age range. Approximately 29.5% (13.3% female, 16.2% male) of Instagram users fall within the 18–24 range, while users aged 25–34 account for another 31.6% (14% female, 17.6% male). Instagram has more users aged 35 and older (38.9%) compared to TikTok (34%), providing more opportunities for you to reach a slightly older and more diverse audience.

While also popular among younger demographics, Instagram has a broader age distribution and a user base of over 2 billion active users worldwide (Statista, 2024).

That said, TikTok sees better engagement among its users. An average TikTok user spends around 69 minutes per day on the platform, with an average engagement rate of 5-7%. Meanwhile, Instagram typically sees an engagement rate of 1-3%, with its average user spending 34 minutes per day on the platform (Oberlo, 2024).

Overall, TikTok is best for engaging younger users due to its high interaction and engagement rates among Gen Z and younger Millennials. Instagram, on the other hand, has a broader demographic reach and a more balanced user base, making it a versatile platform for reaching diverse age groups.

Ads and Pricing

TikTok Ads Can Be Cheaper Than Instagram

Both TikTok and Instagram offer various ad formats, but they differ significantly in terms of pricing and targeting options.

TikTok ad formats include:

• In-feed ads: Ads that appear on users’ For You pages, blending with organic content
• Branded effects: Custom filters, stickers, and effects that allow users to interact with your brand
• Branded hashtag challenges: Hashtag campaigns that encourage user-generated content and engagement
• Spark Ads: Organic posts turned into ads to gain more visibility

Instagram ad formats include:

• Carousels: Multiple images or videos in a single ad
• Stories ads: Full-screen ads that appear between Stories
• Reels ads: Similar to TikTok’s in-feed ads but in Instagram’s Reels format

TikTok’s ad costs are generally lower than Instagram’s, especially when targeting younger demographics. TikTok’s cost per thousand impressions (CPM) is often cheaper than Instagram’s. This makes it a more cost-effective choice for reaching large numbers of users, particularly during less competitive times of the year, like January.

Another key difference is the minimum daily budget requirements, which vary based on how you structure your campaigns.

On TikTok, the minimum daily budget is $50 at the campaign level and $20 at the ad group level. This means you need to allocate at least $20 per day for each ad group you create, and $50 per day at the campaign level. In contrast, Instagram allows you to set daily budgets as low as $1 at both the campaign and ad set levels.

While Instagram appears more budget-friendly at face value, TikTok’s higher minimums can result in better performance, particularly in competitive markets. Ultimately, the best platform depends on your business goals, audience demographics, and the level of control you need over targeting and placements.

Support

Both Platforms Offer Helpful and Well-Organized Resources

TikTok generally offers superior customer support options for businesses compared to Instagram. The articles in TikTok’s Help Center are well-organized, making finding information on specific ad or business tools easy. Additionally, the extensive video tutorials and step-by-step guides simplify the app’s usage, even if you’re not tech-savvy.

Using a dedicated form, you can report various issues on TikTok, such as business-related inquiries, account bans or suspensions, bug reports, and policy violations. For TikTok Shop-related inquiries, you can use its Contact Us form in the Seller Center. Additionally, there’s a Safety Center with guides that provide support for safety, privacy, and security.

Instagram’s Help Center is equally well-organized, comprising step-by-step guides and tutorials. Instagram also provides dispute support forms for limited, restricted, or disabled accounts and offers a report feature to flag posts that violate community guidelines.

TikTok vs Instagram: Which Is Better for Your Business?

After an exhaustive analysis of the features, algorithms, demographics, and content formats, I’ve concluded that the best platform for your business depends on your type of business and growth stage.

I recommend Instagram if your business is already established and you have a decent marketing budget. Plus, if your customer base spans a broader age range, you’re more likely to find users of all ages on Instagram.

However, TikTok is better suited for you if you’re a small business with a limited number of followers or a tight budget. If you target a younger demographic, you should take advantage of TikTok’s low CPM and high engagement rates.

For a quick recap, check out the comparison table below.

FAQs

Is Instagram or TikTok better for small businesses?

It depends on what your business needs. TikTok offers faster organic reach and higher engagement, making it better for small businesses just starting out. Instagram, on the other hand, is better for small businesses looking to scale and develop long-term customer relationships.

Why should I use TikTok over Instagram for marketing?

You should use TikTok over Instagram for marketing if you want a faster organic reach, stronger engagement, and better access to Gen Z. Generally, TikTok offers a lower CPM compared to Instagram, which means you’ll likely also spend less trying to reach your audience.

Is Instagram or TikTok safer for businesses and their audiences?

Both Instagram and TikTok prioritize user safety and maintain comparable protection standards for businesses and their audiences. However, Instagram has more personal safety features, such as support for individuals with eating disorders and protocols for handling threats related to sharing private images.

Is it better to post on TikTok or Instagram?

TikTok is better if you want fast growth, high engagement, and to reach Gen Z. Its algorithm pushes content to new users, making it easier to go viral, even with a small following. Instagram is better for long-term brand building among your followers.

Which is more popular between TikTok and Instagram?

In the debate over TikTok vs Instagram popularity, Instagram still dominates globally with 2 billion monthly active users compared to TikTok’s 1.69 billion (Statista, 2025).

Is it better to do affiliate marketing on Instagram or TikTok?

Instagram is generally better for affiliate marketing due to its more mature audience, diverse content formats, and advertising tools. You can add links to paid Instagram ads, Stories, and even on your bio, making it easier to direct traffic to your sales page. You can also track campaign effectiveness with Instagram Insights or a social media marketing tool to improve your strategy for better engagement and conversions.