Three tips for setting your Facebook ad budget

Three tips for setting your Facebook ad budget

Do you want to run Facebook ads, but you don’t know what budget to invest in your campaigns? Don’t panic. Our digital marketing agency Falia gives you three tips to define your budget. It’s all about balance. If you allocate too low a budget to your Facebook ads, you will surely miss out on many opportunities. However, if your budget is too high, you could also lose money.
Stay tuned. We reveal our most valuable tips right here:

Three tips for setting your Facebook ad budget

Tip 1: Have a good understanding of the Facebook ad manager

There are two ways to set your budget on Facebook. The first is to set a budget at the campaign level and then let Facebook optimize that budget. If you give a budget of $15 per day, Facebook’s algorithm will take care of allocating the budget to the different ad sets within your campaign. As a reminder, here is the structure of a Facebook campaign:
Facebook will allocate a larger budget to the ad set that performs best with higher site traffic or higher conversions, as shown below:
Yes, but here’s the thing, how do you know if Facebook’s campaign budget optimization is applicable to your campaign? Choose this method if you want to save time to focus on other tasks or if you prefer cost-per-result optimization rather than a specific set of ads. In addition, it is important to understand that Facebook’s algorithm is a robot and will not know which set of ads is most valuable to you. Therefore, if you want to favor one set of ads over another, you should prefer to manage the budget by yourself at the ad set level.

The second method is to manage the budget yourself at the ad set level and actively manage the budget based on the performance of each ad set. With this method, you gain flexibility by allocating the budget to the ad sets that you feel are most relevant. Be careful, however, not to make any errors in judgment. Our agency Falia can help you manage your Facebook budget.

Three tips for setting your Facebook ad budget

Tip 2: Choose between a daily budget or a global budget

Once you have decided to set your budget at the campaign level or at the ad set level, you must choose whether your budget applies daily or over the entire duration of the campaign or ad set.

By choosing the daily budget, you specify an amount to spend each day. Let’s say you set a budget of $10 per day for seven days for your campaign. Facebook will make sure you spend no more than $70 over the week. It may spend less than $10 on one day and up to $12.50 on another day (the algorithm may deviate by 25% from the daily average.) If you want to have campaigns that run continuously and are looking to control your daily spending, this is the way to go!

Regarding the global budget, it can be useful in a particular context, with a specific end date and a total spend over the selected period. For example, during a campaign on a specific period (during a weekend or the Christmas vacations), or during a campaign with which you want to spend your budget at certain times only. Facebook will take care of your budget for the duration of the campaign.

Three tips for setting your Facebook ad budget

Tip 3: How much money to invest in your campaign

First of all, it’s important to define your marketing objectives precisely. You can choose from 11 advertising goals of awareness, consideration, and conversion (see diagram below). Once you’ve defined your goals, focus on the objectives in terms of results: your goals for sales per day, number of visitors, number of forms completed…
You will then have to anticipate the costs per result in order to calculate your projected budget. First, do you have the answer to these questions: How much does a result cost you? Or how much are you willing to pay for the desired result? On the revenue side, do you know how much a result will bring you on average? With the answer to these questions, you know how much a result costs you and the revenue generated per result. From there, it will be easy to calculate the budget for your campaigns.

Once the budget is determined, and if you want to launch several campaigns at the same time, you need to think about the distribution of your budget between your different campaigns. Your campaigns can follow the logic of the sales funnel. You can create three campaigns with different objectives: an acquisition campaign (acquire new customers), a remarketing campaign (people who already know your brand but have not yet bought), and the last one for loyalty (encourage your customers to make a new purchase).

To distribute your budget easily, you can use the 75/25 method, putting 75% of your budget on your acquisition campaign, 20% on remarketing, and 5% on loyalty. It is important to allocate a larger budget to the acquisition campaign because you will collect data that will be used to build your personalized audiences for remarketing. This audience will be composed of people who have visited your website and interacted on your social networks…

To conclude

Once your campaign is launched, remember to monitor your results and adjust your budget if necessary. Depending on the performance of your campaigns, you can lower or increase the budget. It is preferable to increase the budget by 20% maximum and to analyze the results a few days later and re-evaluate afterward.

Leave a Comment

Your email address will not be published. Required fields are marked *