So, you’re thinking about advertising on Facebook Ads, but you’re still working out how much it’s going to cost you to do it. As a first-timer, Facebook Ads can seem quite daunting, especially as there isn’t a written rule book on how much you need to spend to be able to actually see a return for your investment. Instead of plucking a figure out of the air, let me explain the details you need to know before you set up your budgets for your campaigns.
First of all, you need to know about daily budgets and lifetime budgets on Facebook Ads. When setting up a campaign, Facebook will give you the option to select either of the two, and they do exactly what they say on the tin. A lifetime budget gives your campaign an expiration date, which means that if the campaign is doing well and you want to extend it, you simply can’t. You would need to start a new campaign to run the ads again, which is effectively starting from scratch and losing all the learnings from the original campaign. This is why I always recommend setting up a daily budget instead. With a daily budget, you will need to forecast a monthly budget to spend on your Facebook Ads, rather than a set figure for the entire cost of your Facebook Ads. If you opt for a lifetime budget, you’ll be limiting your performance, and ultimately wasting your investment. When setting brand-new campaigns on an account that has never run ads before, you cannot expect to see a magic high figure in your account straight away. Facebook ads do not work wonders overnight. Instead, you need to build up learnings in your account for Facebook’s algorithm to understand who to target to get your ads to convert. It can take a few weeks to lower your cost per result and start to see a return on your investment. Due to this, you need to make sure to factor these first few weeks into your forecasted budget.
Facebook Ads is a test-and-learn approach. No ad is ever set in stone to keep converting, which is why you’ll always be testing in your ad account. If you’re not testing, then quite simply, you’re doing something very wrong! There is always room for improvement on Facebook Ads. Once an ad starts to consistently perform well, that's the time to start scaling your daily spends on that high-performing ad. However, in the background, there still needs to be more tests taking place. Due to this, you need to factor in a high enough budget to increase spends on high-performing ads, as well as have enough budget to introduce new ads into the mix.
As a rule of thumb, I always recommend my clients have a minimum monthly budget of £2,000. This gives them enough room to test creatives in their account without getting stuck in the learning phase due to a limited budget. To get your ads out of the learning phase, your ad set needs to receive 50 results (website purchases) per week. If your cost per result is too high, it’s going to take you a long time to exit the learning phase on a small budget; in fact, you might not ever exit it at all.
Feeling nervous about running your Facebook Ads yourself? Then please feel free to contact me to find out how we can work together to get your business the Facebook Ads performance it truly deserves.
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