Did you know Facebook has 2 billion active users daily that average 40 minutes per use?
Are you currently advertising on Facebook or at least considering it?
If you are struggling or aren’t and looking to get started, you came to the right place. Keep reading, and we’ll answer all your questions about Facebook ads, including how much do Facebook ads cost.
How Do Facebook Ads Work?
Facebook ads give you so much flexibility and control over your budget, audience, and creativity.
Most people use Facebook’s Ads Manager to create an ad and submit it to the ad auction. The ad auction determines who sees which ads. While creating the ad, you’ll provide information that tells the auction who your ad should be served to for the price you bid or less than but never higher.
While creating your Facebook ad, you will set parameters for the auction like:
- Audience targetting
- Budget, daily or overall
- Creative decisions
Facebook ads can have any budget. You are in control of how much you spend and set your own budget. You can even edit during the campaign. When setting your budget you can choose to have a daily spend amount or an overall campaign budget that Facebook will use their bidding system to distribute.
You don’t have to worry about your ad being served outside of your targetted audience either. You can target using demographics like age, gender, geographical locations, and interests to connect with your ideal audience.
Facebook also allows you to have creative control when submitting an ad. You have the option of running a test, image, and or video ad. Facebook will review and give it a relevance score, which will help its placement.
We’ve mentioned it briefly, but to fully understand how much Facebook costs, we need to dive deeper into its bidding process.
The Facebook Bidding System
Facebook’s ad auction uses a bidding system. By breaking down these types of bidding, you’ll be able to understand how much you want to spend.
Since Facebook uses an ad auction, it’s less like a bet and more by chance. When you use bidding strategies, you pull the odds into your favor and set your ad up for success.
Because Facebook wants its users to have the best experience, they don’t give ad space to the highest bidder, instead of to the most relevant. So, Facebook awards the ad with the most value to the potential viewer based on three factors, including:
- Advertiser bid
- Ad quality and relevance
- Estimated action rates
Your bid represents how invested you are in your ad being seen. Your quality and relevance are determined by how interested Facebook thinks your user will be. Finally, action rates are calculated by how likely Facebook anticipates the user to interact with your ad.
When there is ad space up for auction, Facebook combines these three factors, assign it a total value, and then display the ad that ranks the highest. If your ad wins the auction, Facebook then considers all the competing ads, and the winning advertiser is charged the minimum amount required to win the auction. This means even if you set a max bid, you may get your ad seen for cheaper.
If you are working on setting your bid, you have two options. You can choose between an automatic bid or a manual bid.
An automatic bid lets Facebook decide the bid amount for you, and Facebook sets it, so your overall ad budget for max results is used.
Manual bidding is when you tell Facebook the maximum amount you want to spend to win the ad space auction. For example, if you don’t want to spend more than $3 per ad click.
How Much Do Facebook Ads Cost?
Your Facebook ads’ actual cost will be a combination of all the factors that go into your ad relevance and quality score. If your ad targets a niche sector that is highly saturated with ads, you’re going to spend more than if you’re targeting a demographic with a wider audience.
With so many different factors, you might be overwhelmed when it comes to setting a budget. Don’t be.
Most people recommend setting an ad budget of at least $5 a day to get started, but you can set your budget at anything and still start to test out what works best for you. Some average costs by bidding model include:
- Cost-per-click (CPC) – $0.97
- Cost-per-thousand-impressions (CPM) – $7.19
- Cost-per-like (CPL) $1.07
- Cost-per-download (CPA) $5.47
Your cost changes based on the extent of the desired action. You will pay less for one click than you will for a thousand, just like you’ll pay less for a view than you will a download.
What Mistakes Should You Avoid?
There are some standard dos and don’ts you can follow when running Facebook ad campaigns and considering how much do Facebook ads cost.
One of the most important things to keep in mind is audience targeting. If you target too broadly, you won’t get the most bang for your buck, and you may fall short of getting your ad seen by the best potential customers.
The easiest way to ensure you are serving the correct audience is to create an audience profile and describe the person who needs or is interested in your business.
Next is making sure you trust the campaign process and give your ad time to get you the results you want. Focusing on the wrong metrics or insights could influence you to cut your campaign, so make sure you focus on metrics like the following to have the best results. Metrics to focus on:
- Pageviews and repeat pageviews
- Visitor Recency
- Number of comments
- Post shares
- Lead conversions
If you define the goal of your campaign and monitor it appropriately, Facebook ads can take any budget and take your advertising to the next level.
Are You Confident Running Facebook Ads?
There is no definitive answer to the question “How much do Facebook ads cost?” but we can give you plenty of tips and examples to set you on the right path.
Every Facebook ad strategy will vary, and it’s up to you to determine what works best for your needs. If you’re unsure about running it yourself, you can call in the experts to assist in all your Facebook ad needs.
Check out how you can get a free Facebook strategy session and take your first step to Facebook advertising gold!