Table of Contents
Introduction
Social media advertising is a cost-effective way to reach a large audience and support your organic marketing efforts. In this guide, we will cover the fundamentals of social media ads and how to get started with Facebook ads. Facebook ads are incredibly effective for digital marketing in many industries. As an advertising platform that is integrated into Facebook’s networks, it offers a comprehensive target audience and a relaxed environment for users. It is one of the most effective ways to gain brand recognition and followers. If you are new to digital advertising, don’t worry. Facebook Ads may seem complex, but it is less scary than it seems. Once you understand the options available and the best way to run campaigns for your business, it can be quite effective and easy.
Understanding Facebook Ads Cost
Your options for Facebook ads are based on two main factors: campaign objectives and bidding. Bidding is the key factor in determining the cost of your Facebook ads. Your bids are factored into three main strategies:
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Maximum bid strategy: This strategy means that your entire budget will be spent to achieve the best result for your campaign. It is suitable for pages that are focusing on raising awareness rather than direct sales.
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Manual bid strategy: With this strategy, you have full control over how much you bid. It is suitable for small budgets or awareness campaigns, allowing you to spend only the amount you have allocated.
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Value bid strategy: This strategy allows you to set a specific metric or objective for your campaign to reach. You can aim for maximum return on investment (ROI) or cap your bids at a certain amount.
When setting the amount to spend on your advertising, make sure you select either the daily amount or the monthly amount. Be careful not to accidentally set the budget for the month as the daily amount. It is important to triple-check this to avoid overspending. Facebook provides a handy document for further information on bid strategies.
Average Facebook Ads Cost
The cost of Facebook ads varies depending on factors such as country, industry, and the time of running your ads. In Australia in 2020, the average cost was $0.50 according to ADCostly. Different industries have different costs, and it is important to consider the average cost per click (CPC) for your specific industry. For example, in 2019, the average CPC across industries was $1.68, and in 2020, it was $1.72. Despite the fluctuations caused by the COVID-19 pandemic, overall, the cost of Facebook ads remains relatively stable. It is important to note that these figures are averages and may not reflect exactly how much you will spend.
Factors Affecting Facebook Ads Cost
While there are many factors at play in determining the cost of Facebook ads, some are within your control. Here are some factors to consider and tips on how to manage them:
Bidding Strategy
The bidding strategy you choose can greatly impact the cost of your Facebook ads. Setting your bidding strategy to maximum can help you outcompete rival companies for ad spots, but only if your budget allows. For small budgets or awareness campaigns, it is recommended to set your bidding selection to manual, ensuring that you only spend the amount you have allocated.
Timing
The timing of your Facebook ads can also affect their cost. There are more popular times to advertise, such as during major retail events like Black Friday. During these times, the cost per click can be higher, and the performance of your ads may be compromised. If you are not a retailer or do not have a Black Friday deal, it may be worth switching off your ads or setting them to minimum spend during these periods. Additionally, targeting popular demographics, such as fitness or beauty, can result in increased competition. Consider using alternative targeting methods, such as geolocation, to reach potential customers.
Placements
Choosing the right ad placements can also impact the cost of your Facebook ads. Some ad spaces on Facebook are highly desirable, and advertising in these spaces may cost more. Facebook Messenger ads, for example, are not as effective as ads in Feeds, Facebook Search Results, and the Right Column. It is important to investigate different placements and choose the ones that will save you money while still reaching your target audience.
Objective Selection
Choosing the right objective for your ads is crucial. For beginners, focusing on objectives such as awareness is a good place to start. These objectives are generally less costly, as they do not require specific actions from your audience. The more actions you want your audience to take, such as app installs or conversions, the higher the cost is likely to be. Save these objectives for later, when you have a bigger budget and more established presence.
Audience Relevance
To ensure the effectiveness of your ads, it is important to target a relevant audience. Facebook, like Google, prioritizes delivering a positive user experience by showing ads that are relevant to the audience. Advertising to audiences that are not likely to respond or enjoy the ad can result in financial penalties. Utilize your organic audience to gain insights into your demographics, or create a Lookalike Audience of people who have recently shown interest in products similar to yours.
Industry Competitiveness
The competitiveness of your industry on Facebook can also impact the cost of your ads. Highly competitive industries may require a larger budget to stand out, but it is still a worthwhile investment. In these industries, it is important to grow your organic audience alongside your paid advertising efforts. Limit more expensive ad objectives to a few times a year to avoid overspending.
The Importance of Retargeting
Allocating a portion of your ad spend to retargeting is highly recommended. Retargeting is an effective way to remind your customers about your business and maintain their interest. Allocate about 10-20% of your budget to this strategy, increasing the amount as your customer base grows. Viewing Facebook ad campaigns in stages, including discovery, sales and conversions, and retargeting, can help you develop a budget for your ad spend.
Conclusion
If you’re ready to dive into the world of Facebook advertising, keep in mind your industry, objectives, bidding type, and timing. Start with a minimal budget for an awareness campaign and gain confidence as you see results. If you prefer a more hands-off approach, there are many social media agencies available to help you build your customer base through Facebook marketing. Get started today and take advantage of the unparalleled audience and cost-effectiveness of Facebook ads.
