How Much Should You Be Spending on Facebook Ads8 min read

Facebook has helped many companies achieve their financial goals through its Facebook Ads feature. If you’re a business owner, your next question might be: “How much does Facebook Ads cost?”.
How Much You Need to Spend on Facebook Ads
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Many companies turn to social media for online presence and advertising campaigns. Facebook has helped many companies achieve their financial goals through its Facebook Ads feature. If you’re a business owner, your next question might be: “How much does Facebook Ads cost?”.

In this blog, we will discuss Facebook ads pricing and see if it’s worth your money. Specifically, we will cover the following key points:

Pricing: How Much Does Facebook Ads Cost

It’s tough to come up with an exact cost per ad because there are many factors that affect Facebook Ads pricing. There are so many influencing factors which determine ad costs, including (but not limited to) your industry, the competition when bidding, the quality of your ad creative and landing page or website, and how hard Facebook has to work to convince someone to take the desired action.

However, if we will refer to a study of over $100 million ad transactions conducted by AdEspresso, a Facebook Marketing Partner, the benchmark of Facebook Ads pricing (in U.S. dollars) will be as follows:

  • Average Cost per Click (CPC): $0.35 (globally) and $0.28 (U.S.)
  • Average Cost per Like: $0.23 (U.S.)
  • Average Cost per App Install: $2.74 (U.S.)

Note: We only use AdEspresso as an example because they have the most updated information. You can also use data gathered from other companies like SalesForce and Nanigans.

Here are some important data from AdEspresso’s study:    

CPC of facebook advertising
CPC App on Facebook ads

Examples of Facebook Ads

After deciding to invest in Facebook ads, the next step is to learn how to curate effective advertisements. Many factors affect the success of an ad, and the ad creative is a huge component as it determines how your potential customers will receive and engage with the ad copy, creative, call to action, and the image or video itself. Here are some Facebook Ads examples and the reasons why they are effective.

Facebook Ads Example #1: Slack’s “Make Work Better”

 What makes it effective:

  • Visually attractive. Uses the same colors as the company’s logo, so it instantly bridges a connection.
  •  Playful and uses imagery. A girl who is presumably working but having a good time riding a horse makes the message relatable.
  • A well-positioned Call-to-Action (CTA). “Learn More” invites the audience to visit the site, thereby increasing its traffic and conversion.

Facebook Ads Example #2: Google’s “Build What’s Next”

Google Cloud Platform technology

What makes it effective:

  • Using active verbs. Let’s refresh our grammar: Active verb is when the verb is “the doer” in the sentence. For instance, “Get $300” means “you” (unspecified subject)” “get” (active verb) “$300” (object).  Using an active voice is a must for marketing copies. (Learn more about active vs. passive voice here!)
  • Using simple yet bold primary colors combined with a clear message.
  • Financial incentives. Who doesn’t want to receive $300 anyway?

If you want to view more Facebook Ad examples, or even see what ads your competitors are running, you can do so in the Facebook Ads Library.

Guide and Strategy: Facebook Ads

There are many Facebook Ads strategies that you can use to increase the effectiveness of your campaign.
There are many Facebook Ads strategies that you can use to increase the effectiveness of your campaign.

Facebook Ads Guide outlines the requirements for every ad based on a format (what it looks like) and the placement (where it will be displayed). In other words, it serves as a blue book that tells the advertisers the dos and don’ts in creating an ad. Here, you will learn the specs of an ad, like dimensions, file sizes, and character limits.

There are many Facebook Ads strategies that you can use to increase the effectiveness of your campaign. Many marketing experts agree that there is no “one size fits all” approach that applies to all businesses. Facebook always tweaks its ad platform, which makes it hard for companies to identify which plan is the most effective.

Here is the Facebook Ads strategy that we use to produce great results for our clients 

Traffic

A targeted campaign on Facebook that has the objective of ‘traffic’ to get more eyes on your company’s website and increase the chance of conversion in the next step. Remember, the objective you select means that Facebook will work harder to get people to take that desired outcome. You will still get other actions take place, such as conversions. However, Facebook will show your ad more to the people who usually visit websites, but may not convert. This is a 3 pronged strategy.

Conversion

Next, we target the same audience with a ‘conversion’ campaign. We use a similar ad set format, with an objective of conversions. So this campaign is going to work harder to get your desired outcome of conversions, and is likely to show more so to people who typically convert online from Facebook Ads. You will still receive traffic from this campaign with no conversion, so this leads us to step 3.

Remarketing

Some would argue that remarketing is one of the largest components of a successful Facebook Ads campaign. This is because if you don’t run remarketing campaigns, you are leaving money on the table. How often do you visit a website and leave without making a purchase, just because life is busy and we don’t always get to do the things we want. Following up non-converters is a smart way to ensure that you are giving yourself every chance of closing the deal.

Facebook Ads 2020

Facebook Ads is still a major force in online marketing, as more than 7 million advertisers are expected to use it this year.
Facebook Ads is still a major force in online marketing, as more than 7 million advertisers are expected to use it this year.

Facebook Ads will remain strong in 2020, as the majority of the Australian population are now active Facebook users. However, the competition has become tougher than ever, as more than 7 million advertisers are now using Facebook Ads for their marketing campaigns.

Here is a snapshot of what Facebook Ads in 2020 will be like:

Facebook Ads Cost Will Go Up: The basic concept of supply and demand can explain why this is so.

Ad Automation Will Be Used More: The use of artificial intelligence (A.R.) is expected to grow.  Facebook will keep promoting automated features for faster transactions and real-time data monitoring.

Mobile Advertising Will Continue to Grow: More companies will invest in mobile advertising to target cell phone users.

Facebook Ads Manager

Facebook Ads Manager is the platform where you create ads, manage when and where your ads will appear, set your budget for the campaign, and track your ads’ performance. It’s a pretty straightforward ad tool designed for advertisers of any experience level.

Aside from the interface itself, Facebook Ads Manager also has resources where you can learn the step-by-step process in creating an ad, reviewing and adjusting campaigns and real-time ad reporting.

Summary

Facebook is here to stay. If you’re a business owner who wants to increase your revenue, using Facebook Ads are highly recommended.

There is no clear-cut answer as to how much Facebook Ads cost. It depends on various factors, including timing, bidding strategy, placement, and your target market. One thing is for sure, there is always a way to create a campaign that will not go beyond your daily budget.

The question shouldn’t be “how much are Facebook Ads going to cost me?” and rather, what amount can we afford to allocate towards our marketing activity, either with a monthly cost, or even better would be a cost-per-acquisition (CPA) amount that you can add into Facebook as the maximum you can spend per new client acquisition. 

Mastering Facebook Ads will not happen overnight. Every process poses a challenge. But if you really want to improve your business, learning Facebook Ads might just be what you need.

Learn more about Facebook Ads cost. Message us here:

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