Home » Online Earning » How to set a budget for Facebook Ads
Drowning in credit debt?

How to set a budget for Facebook Ads

facebook-adsThe cost of the Facebook ads depends upon the size of audience and budget. You are in complete control of how much you spend on advertising by setting a daily budget or a lifetime budget for your advertisements. For most of the ads the minimum amount you can pay for it ranges from $1-$5 per day. You might need to spend even more, based on what you are advertising for and how do you want it to be.

CPC( costs per click ) and CPM ( cost per thousand impressions) is the two popular methods of advertising on Facebook. Your selection of method depends upon the targeted audience and also on the bidding type. You can also use the option of boost a post as it helps advertiser to promote the post through News feed. To know how much it would cost you to boost a single post, you will have to go to your page and click on the option ‘boost post’, pick a budget and then they will show you how many people this post could reach to, in this set of budget.

Ads with automatic bidding (automatic biding means Facebook will be bidding on your behalf) have a minimum daily budget of $1.00 USD and it must be atleast two times your cost per click bid. Now for example to make it easier, lets assume you have a $1.00 cost per click, so the daily budget must be atleast $2.00,  which is double of the cost per click. As far as manual bidding is concerned the minimum daily budget is same as for automatic bidding, which is $1.00 and this must be atleast 5 times your cost per click bid. So if you have a $1.00 cost per click, the daily budget will be set at $5.00.

Always remember that your Daily budget will be different from your account spending limit. This allows everyone to set an overall spending limit for an entire advertisement account. It also ensures that if your set amount has been used, the ad will stop running on Facebook. Your budget is always an estimate, the reason being that Facebook would not spend your entire budget in a day if your advertisements are scheduled to run for more than a day.

Another factor that affects Facebook ads’ prices is CTR (click through rate), the higher click through rate you can achieve, the greater chance you have at winning the auctions. This is how you calculate the click through rate: Divide the amount of clicks your advertisements get by the amount of impressions they receive. For example if you have received 1000 impressions and generated 10 click clicks through rate will be 10/1000= 1%. Many people argue that the click through rate is the most important factor to determine the Quality score, and the advertiser with the highest quality has an advantage.

If you create more campaigns with fewer advertisements, then this way Facebook will show all your ads for a longer period of time before giving them the ultimate quality score. Remember to keep all this information while a setting a budget for your Facebook advertisement to get the best results!


About Emaad Qureshi