Instrumenting a Ruby application with the Elastic APM Ruby agent is streamlined by installing the elastic-apm Rubygem, which offers built-in support for Rails and Rack, alongside options for custom instrumentation. Users can enhance data collection by assigning specific tags and user information, making it easier to identify performance issues specific to certain customers. The SpanHelpers module allows tracking the duration of specific methods, and a public API enables manual creation of transactions and spans for more granular control. The agent simplifies the initial setup while offering advanced tools for detailed application analysis, allowing users to either run the Elastic stack locally or use the Elasticsearch Service on Elastic Cloud to monitor application performance and optimize user experience.