One of the most used strategies is Facebook advertising. Facebook being the leading social media platform is crucial for businesses to expand their presence. We will answer the question, “How much does it cost to advertise on Facebook?” in this article.
It is a question that is asked quite often. What’s more, a Facebook Ads expert can give no more than a cost estimate. It is because Facebook ads cost depends on several factors.
We’ll answer the question of how much are Facebook ads and discuss factors that dictate their cost. We’ll also take a look at Facebook for Business Suite. Also, we discuss how you can use the feature to set up ads for your business.
Why Businesses Invest In Facebook Advertising?
Facebook still holds the largest end-user population among any social media platform. The social media giant reported 1.82 billion daily active users and 2.74 billion monthly active users in October 2020. The increase corresponds to a 12 percent rise in active users.
As a company ahead of the curve, Facebook offers distinct advantages for any company dealing in Facebook advertising:
- Its massive user-shipensures a profitable target audience for any business.
- It is cost-effective for small businesses to scale because of its low budget thresholds for CPC (cost-per-click) and CPM (cost-per-thousand-impressions.)
- It offers superior targeting optionsto bring the most out of advertising.
- Advertisers can reach younger users through cross-channel marketing as Facebook is linked to Instagram.
Advertising only works if you can reach your audience. Facebook allows you to find your target audience and make the most profit. Plus, Facebook having the highest number of end-users exposes you to an expansive marketplace.
A Walk through of Facebook for Business & Ads Manager
Inside Facebook Business Suite is an essential tool to manage your social ads: Facebook Ads Manager. Through the Ads Manager tool, you can:
- Create and set up Facebook and Instagram ad campaigns
- Create and manage ads and ad sets
- Manage your Facebook ads budget by minimizing Facebook ads CPC and Facebook ads CPM
- Optimize Facebook ads and ad campaigns through better targeting
- A/B test Facebook ad campaigns
- View insights on campaign performance
Types of Facebook Ads
From inside the Facebook Ads Manager app, you can build different types of ads depending on your campaign objectives. Your choices include:
- Image ads
- Video ads
- Video poll
- Instant experience
- Slideshow ads
- Lead ads
- Dynamic ads
- Messenger ads
- Stories ads
- Playable ads
How to Access Facebook Ads Manager
To access Facebook Ads Manager, visit the panel on the left side of your computer screen and click on Ad Center. On mobile, tap on the hamburger menu on the top right section of the Facebook app, tap on “Also from Facebook” and then on “Ads Manager.”
Alternatively, you can also download the Facebook Ads Manager app on the Google Play Store and Apple App Store.
How Much Do Facebook Ads Cost?
Figures for average costs exist online and can be used as a benchmark for Facebook ads pricing. According to Word Stream, the average Facebook ads CPC rate is $1.72 while the average Facebook ads CPM rate is $9.8.
So, how much are Facebook ads? Facebook ads experts agree that the true cost varies from the estimate. Furthermore, the social media giant uses auctioning to decide the price. Within the Facebook ad auction system, a Facebook advertising company can place their bids. These businesses compete with other Facebook ads companies to show their ads.
But merely placing a bid won’t guarantee ad performance. Facebook also looks at the relevance of your ad to determine the best ad to display on a user’s timeline.
Many other factors affect the performance of Facebook ads on its Facebook ad auction system. These factors also impact Facebook ad pricing. Make sure you consider these factors when setting your Facebook ads budget:
- Ad quality
- Ad placement
Everything boils down to competitive pricing. Just like supply and demand, as more advertisers push to get their ads shown, the cost of ads tends to differ. Therefore, seasonality comes into play for some advertisements and some industries have to run ad campaigns that cost more. Monitoring these pricing changes helps to optimize Facebook ads performance.
According to Idealysis,
“Pricing changes should always be monitored and utilized to make educated optimization efforts toward audience segments with the highest return on investment (ROI).”
How Much Should Pay For Facebook Advertising?
In the previous section, we established an answer to the question “how much to pay to advertise on Facebook?” But for many businesses, the question that really matters is “how much should I pay to advertise on Facebook?” Determining the budget depends mostly on your requirements and how you wish to scale your business.
According to Idealysis, social media strategist and Facebook advertising expert, the best place to start when building your budget is by looking at historical data. Industry benchmarks offer plenty of information to help you establish your budget.
But when no data is available, you will have to build your own database from scratch. Run multiple ad campaigns, collect and analyze information and A/B test your ads to give you sufficient data you can use to optimize Facebook ads.
Utilizing industry benchmarks is a good place to get started,” said Idealysis. “Keep in mind that if a company is starting from a blank slate with social advertising, they [should] be willing to invest several months into traffic and A/B testing to collect the data needed to fuel a successful campaign.”
As you focus on building an effective ad strategy, remember that an optimized campaign takes a significant amount of time and investment to build, especially if you’re only starting out.
A business should always keep in mind that paid social media campaigns are an investment in learning how your targeted audience reacts [to] your business and products,” Idealysis explained. “It will take a few months to get a solid understanding of what works. From there, budget allocations are [built up] towards what is driving the highest return on ad spend (RoAS).”
Find the right approach that generates the most returns. A $1,000 campaign that returns $1,500 in revenue is way better than spending just $200 with only $100 in returns.
Determine the Objective, Take Small Steps & Just Go Ahead
In this blog, we answered questions like “how much do Facebook ads cost?” and “how much does it cost to advertise on Facebook?” We also briefly talked about Facebook for Business and how the bidding system affects the social advertising prices.
But the thing to remember is nothing is constant when it comes to Facebook advertising or its cost. As for how much you should spend on Facebook ads, Idealysis offered a simple piece of advice:
Determine your company’s goal for social advertising. If a small, local business wants to give Facebook advertising a try, feel free to start small, ideally $500 per month. This is enough to run a small campaign and get tastes for how advertising can help overall business objectives,” Idealysis shared.
If a company is interested in diving in to gain data quickly, the cost should be at least $2,000 per month,” Idealysis added. “Already established and looking to scale? Then you already know what your target spend amount [should be].”
Advertising your business on Facebook is one of the best ways to establish your brand as an industry leader. Using Facebook’s ad platform, you don’t have to be a Facebook advertising agency to gain access to a wider audience.
Idealysis is a Facebook advertising agency that helps you share the right message to the right people on Facebook. Our Facebook ads agency offers Facebook advertising services geared toward helping you maximize ad placement while minimizing your budget. Start a conversation with us today by filling out this form or by giving us a call at 332-255-1565.