Facebook Ad Bidding Strategies Lower Your Ad Cost
Facebook ad bidding is and how it will help you reach your campaign goals for less money. Facebook ad bidding can be a bit complicated, and the number of different options is usually a bit confusing as Facebook keeps updating the interface.
Facebook’s ad delivery system works on a bidding system. This method automatically determines which ads will be displayed in the news feed. This is one of the most important factors that directly affect Facebook ad performance, choosing the right bid cost strategy.
Facebook’s ad delivery system relies on an auction model where advertisers compete with each other to show ads to their desired audience. Each advertiser enters this auction by determining the amount they are willing to pay for an action (in this case conversion) for someone in their target audience. Today we understand what Facebook ad bidding is and how it will help you reach your campaign goals for less money.
What is Facebook Ad Bidding?
Facebook ad distribution is based on an auction format. Your cost will often depend on the bid you make to reach your audience. You need to understand that Facebook advertising is similar to joining an auction worldwide.
The amount you bid for a click or conversion or 1000 impressions is not what you are always going to pay. This is the maximum you are willing to pay to win that bid. Facebook will always make sure that you have to pay the lowest amount that’s possible to win that bid. For example, If your competitor bids $5 and you bid $10, then you will only have to pay $6 or even ($5.01) actually to win the bid instead of $10.
You also have to understand how to target your audience and optimize your ad bidding strategy with the Facebook Insight tool. You never spend more than what you want to do. If you bid $ 10 per click, but you only have to pay $ 3.59 to beat the $ 3.58 click of your competition, you will pay for that placement.
Scaling up a Facebook advertising campaign while maintaining a low cost per lead or sale can be very difficult. There are 3 Facebook ad bidding strategies to help you tackle this issue
Lowest Cost Bidding Strategies
Facebook designed the lowest cost bid strategy, formally known as “automatic bidding,” to get you the lowest possible cost per optimized event while spending the entirety of your budget.
With this option, Facebook will still spend your daily budget, even if advertisers have a lot of competition for your target audience on a particular day. In which case, to reach those people you have to spend a lot.
When to use it?
When you validate the cost per result and want to know at what price you can get the result without using manual bidding.
When you want to spend the whole budget and get maximum results. Scaling without a manual bid gives you the opportunity to get the maximum amount of targeted actions.
Lowest Cost with Bid Cap Bidding Strategies
This option will prompt Facebook’s algorithm to achieve a minimum cost to ensure that the cost per action exceeds the specified limit. When using a minimum cost bid strategy (formerly known as automated bidding), Facebook bids with the goal of achieving the lowest possible cost per optimization event.
This allows you to set a bid cap, which is the maximum amount you pay for a single result.
This helps advertisers maximize the cost-efficiency of their advertisements, giving them the ability to control costs and drive volume. This also ensures that they can maximize conversion volume while estimating costs. As mentioned in a recent Facebook Business Post:
This type of cost control allows you to ensure that you will never make more than you can afford. While this may reduce the risk of you making appointments because you are not running an “average” bid amount, you are guaranteed not to spend as much as you would like for any outcome. This may make it easier for some advertisers to maintain their advertising spend and stay on budget.
Target Cost Bidding Strategies
This bidding strategy is only available for campaign purposes that allow you to optimize for conversions (conversions, lead generation, app installs, or catalog sales) and helps you determine an average cost per result, which Provides you more control than the lowest cost bid.
The target cost bid strategy, formerly known as “manual bidding”, is available for the following campaign purposes only:
Facebook recommends using this bid strategy for achieving more stable results as your spend increases.
This bidding strategy is ideal when you increase your campaigns’ budget as it ensures that your costs are maintained at the specified bid.
Target costing was called reach your campaign goals for less money manual bidding strategy. This is giving you a lot of control over the results you want for how much it costs for the results. As you are moving through the ad creation process, Facebook does not need to customize anything in the Budget and Scheduling section other than your budget and schedule. You do not want any choice about bidding of any kind. But, if you choose so, you can- and where the manual is bid.
Manual bidding is giving you a lot more control over how much you spend for the results that you want. These options, pictured below, are how you set up your manual bidding strategy.
The rules of manual bidding are that you have a lot of control over your budget and this is the way to go if you are trying to keep your CPA within a certain range. The cons are that if you bid too low you can do more harm than good, making manual bidding more “risky” and this is a bit of a learning curve.
So through review, automated bidding is actually Facebook’s way of trying to optimize to get you the most efficient spend over the course of a day. So if you set your budget to $ 30, it’s going to cost $ 30, and Facebook is about to go out and try to find people who can do that for those $ 30.
Facebook places an automatic bid within each auction. The bid is calculated to spend the entirety of your specified budget while accumulating the most results for your ad. Facebook wants their users to trust the platform to achieve the most results for the best possible price.
Automatic bidding vs Manual Bidding
One thing I really want to shed light on is manual bidding, which is quite different if you’re used to automatic bidding when it comes to how much money you spend in advertising Spend, then it is actually controlling the bid that you have instead. Allocate as daily budget.
Automatic bidding focuses on maximizing your ad delivery. For example, if your audience is sufficiently large and your daily budget is $ 1,000 a day, Facebook will almost always consume your daily budget by serving more people who are likely to take action.
When comparing average costs per campaign, Facebook ad campaigns using automated bidding increased manual bids by 15% — but when looking at just 10X custom bids week, the custom bid campaign allowed the automated campaign to have 16 Increased to%.
Facebook’s different bidding strategies affect your Ads budget in several ways. It’s best to get to know these as they cause you to spend your budget differently. Choosing the right bid strategy
When using a manual bidding, the lowest cost with a bid cap or target cost, you should consider raising your daily budget 3–5 times your bid. This will ensure a stable as possible ad delivery, while at the same time conversions are coming to help you reach 50 conversions per week, which is necessary for the algorithm to work properly.
Here’s a list of campaign objectives and their matching bidding options:
-With Facebook Conversions objectives you can bid on Conversions, Link Clicks, and Impressions
-Choosing campaign objectives Traffic, which lets you bid on Link Clicks (CPC) and Impressions
-Video views, which lets you choose between 10-Second Video View and Impressions
-App installs, which lets you bid on App Installs, Impressions, and Link Clicks
If you want to keep the cost per result under control, we recommend choosing the lowest cost bid strategy with a bid cap. However, it is important to realize that in this case, your campaign will likely achieve lower results and not spend the entire budget. Otherwise, choose the lowest cost bid strategy without a bid cap.
Facebook ad bidding can be a bit complicated, and the number of different options is usually a bit confusing as Facebook keeps updating the interface (and your likes) about once a year. And there is no single ad bidding strategy that fits all! Test different strategies as much as you can! While testing, you can find out the best strategy for specific marketing objectives, campaigns and KPIs.
Originally published at https://www.vianinja.com.