Facebook Ad Bidding in 5 Steps
As Facebook’s popularity continues to burgeon, so does the cost of advertising on the world’s largest social media platform.
In the last quarter of 2013, Facebook cost per click ads cost $0.21 per click. This was a 24% increase from previous years. At the same time, the price of cost per impression ads multiplied by 140%.
Marketers have significantly increased their social media ad budgets and the return on investment is quite impressive with retail businesses reporting up to 152% increase on their ROI between November 2013 and November 2014.
What are all these figures pointing to?
Facebook advertising can be effective in amplifying your social reach and complementing your other marketing efforts. Getting the bidding process right is a step in the right direction when it comes to leveraging the power of Facebook ads.
Here is how to get started:
Set clear goals for your advertising strategy
To get the most bang for your buck you need to be very clear about what you want to achieve with Facebook ad campaigns.
Are you looking to gain visibility, increase website or landing page traffic, promote an event, product or service, increase engagement, drive action?
If you have dedicated a budget toward your advertising efforts, should you not ensure that you are getting the best possible returns in terms of meeting your goals?
Understand the bidding process
Given the potentially high ROI from Facebook ads, it is unsurprising that millions of marketers are rushing to advertise on the platform.
The bidding process is essentially an auction in which you are competing for advertising space with other marketers. Just like in a real auction, the highest bidder wins.
The secret to getting advertisement space and for your ads to receive adequate exposure is to bid high enough. The price you bid is not necessarily what you will pay for the actual ad; you will probably pay much lower per click or impression.
Leverage the appropriate bidding strategy
Facebook offers several bidding options. The one you choose to run with will largely depend on your objectives. The four bidding options include:
Cost per impression: This strategy allows you to pay based on 1000 impressions. CPM works effectively for brands with a large audience as its able to deliver a higher number of impressions.
If your target audience is fewer than 50,000, this may not be the best strategy, as it will cost you more to deliver the ad to a smaller audience. You could also use CPM if you are only looking to boost brand visibility but not to push a particular action.
Cost per click: This option lets you pay based on the number of clicks. While paying only when someone clicks on your ads sounds impressive, the problem with the CPC model is that you will pay even for low quality clicks. It is important to set up an ad that is highly targeted toward a specific audience to ensure a higher number of quality leads clicks on the ad.
Optimized Cost Per Impression: OCPM is a nifty kind of ad strategy that allows you to set parameters for a specific action so that Facebook serves the ad to users who are likelier to complete that particular action. This is the default Facebook strategy and you should probably leave it this way.
OCPM lets you to optimize your ad for certain actions such as to boost engagement, website traffic, page likes and other such actions.
The cost per impressions for OCPM is higher than for regular CPM ads. But, the upside is that your ads will have greater impact in that they will be delivered to an audience that is likely to undertake the desired action, therefore improving conversions.
Cost Per Action: This is a fairly new type of ad. CPA works great if you are looking to drive a particular action with your ad.
Instead of paying per impression, you bid a maximum amount you want to pay when users complete a specific action after clicking the ad. For example, you can bid on the amount you would like to pay when a user clicks a link, likes a page, installs a mobile app or claims an offer.
Mistakes to avoid with Facebook Ad Bidding
- Not having clear goals
- Bidding too low
- Not A/B testing your audience
- Poor ad design and copy
- Not having a landing page
- Making your target audience too narrow
- Changing your bid strategy and budgets too frequently
- Neglecting your campaign instead of regularly monitoring ad performance
Finally, you need to always be testing the type of bid strategy that is delivering the best results for your ad campaigns.As a reminder, please note that we are an affiliate of Amazon, ClickMagick, Coach Glue, Content Sparks, GetResponse, Kris Clicks, NOW Lifestyle, OptinMonster, Rebrandable Traffic, SiteSell (SBI! & Solo Build It!), and other companies where we may earn reseller fees and commissions if a visitor makes a purchase after clicking on one of our images, posts, or links and visits the advertiser's website.
Thank you for visiting our website, we hope to see you again!Mike Conkey