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You are here: Home / Academy / Guides / The Beginner’s Guide to Facebook Advertising / Facebook Ad Bidding and Optimization

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The Beginner's Guide to Facebook Advertising

The Beginner's Guide to Facebook Advertising

Chapter 7

Facebook Ad Bidding and Optimization

Writing by Massimo Chieruzzi

In Chapter 7, you’ll learn about Facebook’s campaign structure and how to set up your budgets. The nice thing about Facebook’s campaign creation process is that it’s super logical and straightforward. We’ll walk you through all the settings and options in the order they appear in the Ads Manager.
After you complete reading this chapter, you’ll know correct answers to questions like:

  • How does Facebook ad bidding work?
  • How big should my advertising budgets be?
  • How to setup manual bidding on Facebook?
  • What’s the average cost of Facebook ads?
  • How to select the right ad delivery optimization method?
  • How to setup a custom ad delivery schedule?

These questions are only a tiny fraction of all the knowledge you’re about to acquire!
And believe us, understanding the Facebook campaign structure and bidding system will become handy many times in the future!

Facebook Campaign Structure

Facebook’s campaign structure has three levels:

  • Campaign
  • Ad set
  • Ad

A Facebook campaign can contain several Ad Sets and it has a unique campaign objective. Your campaign is basically just a container to help you better organize your advertising. The only attribute of the campaign is the objective you want to reach with it. So if you want to: 1) drive sales to your website and 2) increase the number of likes on your Facebook page, you’ll have to create two campaigns, one for each objective.

A Facebook ad set can include multiple ads and it has a unique audience targeting, budget, schedule, bidding, and placement. Ad sets are also the best units to use for Facebook A/B testing – remember to always place all the variations inside different ad sets.

The Facebook ad (basically what we’ve been creating so far in this guide), is the smallest unit of your campaign. Ads can have different URLs, ad image, and ad copy. Let’s visualize it to make it “rookie-proof”:

Facebook Ads Campaign Structure

As you go through the campaign setup process, you’ll hardly even notice whether you’re editing the campaign, ad sets, or ads – it’s that simplified and easy! As you adjust your ad set’s settings, you’ll have plenty of options regarding the budgets and bids. Up next, we’ll explore each of these ad set elements individually.

How to Set Up Your Facebook Ad Campaign Budget

Picking the right budget for your campaign is critical to success. The first step of the “Budget & Schedule” setup is to assign a budget for your campaign.

Facebook gives you two budgeting options:

1. Daily budget –  Facebook will spend this sum on delivering your ads every day during your campaign. When you set your daily budget, you’re telling Facebook to get you roughly your daily budget’s worth of the results every day.
Some days, when Facebook spots high-potential opportunities, it may spend up to 25% more than your daily budget (and then lower the spend on the low-potential days). As you select the daily budget, your daily ad spend could look like a set of curves.
Don’t worry, that’s completely normal and means that Facebook’s auto-optimizing your ad delivery (which is a good thing).

(image source)

 

2. Lifetime budget – Facebook will divide the total campaign budget more or less evenly across the campaign dates. If you set a lifetime budget, Facebook will ask you for the campaign dates, so that it can calculate the average spend for each day.

We recommend that you set a daily budget and an unlimited campaign duration, so that you can later edit the size of your daily budgets and pause the campaign whenever you see fit.

Important! You can’t change an ad set’s budget type after the ad set has been created. Make sure you make the right selection during the campaign setup.

Ad Delivery Optimization

After you’ve set up your ad campaign’s budget, you can select the Ad Delivery Optimization method.

The Optimization for Ad Delivery tells Facebook what’s the end goal you’re most interested in. For example:If your goal is to drive traffic to your website, optimize your ad delivery for Link Clicks.

  • If your goal is to drive traffic to your website, optimize your ad delivery for Link Clicks.
  • If you want people to convert on your website, choose the Conversions objective.
  • If you want people to install your app, choose the App Install objective.

Facebook Ads Bidding – How it Works?

As you advertise on Facebook, you’ll be competing with hundreds of thousands of advertisers, each wishing to reach their target audience. Facebook ad bidding works on an auction basis. Who’s winning the bid? – The advertiser who has the best combination of best bid, relevance score, and “estimated action rates.”

Manual vs. Automatic Bidding

If you’re putting your first steps in the world of Facebook advertising, we suggest that you use the Automatic bidding. This way, you don’t need any previous knowledge about the average bids and the average cost-per-result.

Use the manual bidding if you know how much the results are worth to you. For example, when optimizing your ad set for Link Clicks, you can set the highest price per click you’re willing to pay. As you set a manual bid, Facebook will show you the range of suggested bids and automatically inserts a suggested bid in the box.

Always change the Facebook’s pre-set manual bid in the custom bidding box. For example, if Facebook first suggests that you bid €1.0 per link click and the bid range is (€0.43–€0.88), you could bid €0.60 or even €0.44.

If you want an in-depth overview of Facebook ads bidding, read our guides:

  • Facebook Ads Bidding 101: Everything You Need to Know (…Supported by Data)
  • The Complete Resource to Understanding Facebook Ads Cost
  • How Much Will Your Next Facebook Ad Campaign Cost? (Contains a Free Ad Budget Calculator)

Facebook Ads Scheduling

Facebook also allows advertisers to set up custom ad delivery schedules, so that your ads will reach people at your chosen weekdays, at your chosen time of day.

We recommend that you use the “Run ads all the time” option for your first ad campaign. Later, as you can see from your ad reports what days and hours work best, you can use these insights to set up a custom schedule.

Facebook Ads Delivery Type

As you’re setting up a Facebook campaign, the last selection in the Ad Set level is Delivery Type. Here, you can choose between:

  • Standard ad delivery – Facebook will deliver your ads with the optimal speed at the lowest cost
  • Accelerated ad delivery – Facebook will deliver your ads as quickly as possible, resulting in higher ad costs

We recommend that you leave the Delivery Type option set to “Standard.” The accelerated ad delivery is mainly relevant to large advertisers with time-sensitive campaigns. Since accelerated delivery optimizes for speed, not value, you may end up with a higher cost per result.

Additional resources:

  • Social Media Ads: Getting Results on a Budget
  • The Evergreen Guide to Facebook Ad Optimization

Place Order and Publish!

Now that you’ve set up all your campaign elements such as the campaign objective, budgets, ad creatives, ad copy, URLs, etc. you’re ready to click on the “Place Order” button and publish your Facebook campaign.

You see, creating your first Facebook advertising campaign wasn’t as terrifying as you might have thought. Really! It’s actually pretty fun, with all the different options available.

In the last chapter of our Facebook Advertising Beginner’s Guide, we’ll show you how to measure and evaluate your Facebook ad campaign’s results (and improve your ad performance).

Chapter 6 Index Chapter 8

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