How Much Does Facebook Advertising Cost in 2021?

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How Much Does a Facebook Ad Cost?

If you’re just getting started with Facebook Ads, I’m sure you’ll have a lot of questions. Most of us do, especially when it comes to how much does Facebook advertising cost.

There is no fixed cost for those who invest in advertising on Facebook; advertisers freely control their spending for each campaign by setting a daily or lifetime budget. The higher the budget, the more people will see the advertisements, and the more new fans will be registered on the company page on Facebook.

When your ad is active, you will only be charged for the number of impressions (CPM) or clicks it receives (CPC). The amount you pay will never exceed the daily or lifetime budget you have set.

How Much Does It Cost to Advertise on Facebook?

Facebook ads campaign can have varying costs, but it is reasonable to expect a cost of around $0.50 — $2.00 per click in most industries.

That said, the only way to know what your Facebook advertising costs will be is to try it out for yourself. So, try running some campaigns and go from there.

When you start running your ads on Facebook, you can choose between a daily or total budget and the total amount you want to spend. For most listings, the minimum amount you can spend per day ranges from $1.20 to $6.01. Your budget, the type of offer that will be chosen (cost per click or cost of a thousand views), the audience you target (a large audience or an audience with very specific behaviors, demographics, and interests), and many other elements will determine the number of people who see the ad or click on it according to your budget.

Cost per Click, per Like, and per Engagement

Since Facebook entered our lives, new possibilities have opened up for finding customers. In fact, Facebook earns through its Facebook ADS advertising channel, which allows advertising banners to be shown to the types of people who are closest to our typical customer; in marketing, it is defined as Marketing Personas.

Defining your Personas is a method of categorizing or describing the people who are most likely to become our customers. The attention placed on people has acquired great importance over time, hence the birth of Marketing Personas. The term “ Person ” is used to define our customers with ideal categories of people, archetypes based on conversion and turnover data and created in order to identify their customers.

By knowing your audience better, we can plan highly targeted and potentially very effective Facebook advertising campaigns. Facebook has built a billionaire business on this functionality of its advertising channel, and all companies that benefit from online should at least test it to evaluate its effectiveness in their own market niche.

What can I promote on Facebook?

On Facebook you can sponsor all kinds of content, such as posts, photos, videos and links, but you can also promote your business or event. The procedure takes a few minutes of time and allows you to create targeted sponsorships by selecting the audience to engage.

On Facebook, there are many different types of campaigns you can promote:

  • the company Facebook page to increase the likes and therefore the subscribers,
  • a certain post published on the page to increase its visibility,
  • an event published on Facebook,
  • Your website by driving traffic from Facebook to our landing pages,
  • applications to be installed on smartphones,
  • videos posted on Facebook,
  • commercial offers.

The possibilities are many and constantly growing. Below I have inserted the image of the page where you can start creating specific ads.

What is the minimum daily budget for an ad group?

For auto-bidding ad groups, the minimum daily budget is $ 1 and must be at least twice your cost-per-click ( CPC) bid. For example, if you specified a CPC of $ 1, your daily budget must be at least $ 2.

For manual bidding ad groups, the minimum daily budget is $ 1 and must be at least 5 times your CPC (cost per click) bid. For example, if you specified a CPC of $ 1, your daily budget must be at least $ 5.

Note that this is not the account spending limit, which allows you to set an overall spending limit for an entire advertising account and ensures that all ads on the account will stop once the indicated amount is reached.

Facebook Ads and advertising auctions

If Facebook bombarded users with advertisements, it is likely that they would eventually stop using the platform.

Hence, Facebook solves this problem by limiting the number of advertisements each user sees.

In other words, the inventory available is limited, and there are many people who want to use it to grow their business.

That’s why you can’t just pay and create your Facebook ads ad to make sure users see it.

On the contrary, advertisers have to bid to secure an advertising placement. Put simply, it is an auction, and whoever makes the highest bid wins the placement and can show their ad to their target audience.

Competition is real

When you use Facebook ads for your eCommerce, you are not only competing with your competitors for advertising spaces. You are also competing with anyone who wishes to reach a similar market niche to yours.

For example, let’s say you sell women’s clothing products to young millennials who care about their health.

In this scenario, you won’t be competing with just other clothing brands.

You will also be competing with, for example, chemical-free make-up brands, vegan product brands, local gyms trying to get new members, nutrition coaches promoting food plans, and any other businesses that target the same target of customers.

When you create ads on Facebook, you will see that your audience size will change each time you add a new targeting criterion.

What defines the cost of Facebook ads?

While there are countless variables at play, there are two foolproof ways to define how much Facebook ads cost: supply and budget.

Your budget is the total amount of money you are willing to spend on a single ad or advertising campaign.

Additionally, Facebook ads offer two types of budgets:

  • Daily budget: The average amount you are willing to spend on a campaign each day.
  • Lifetime budget: The amount you are willing to spend over the entire campaign.

Your bid is the amount you are willing to spend to get an ad placement.

If you don’t choose an offer, Facebook will automatically calculate one based on your chosen budget and campaign duration.

Facebook ads costs: two aspects to keep in mind

Before concluding this section, there are two key points to keep in mind when thinking about the costs of Facebook ads.

  • First, you will only pay a penny more than your closest competitor’s offer.
    This means that if you set your bid to $ 2 and the highest bid among your competitors is $ 1.22, you will only pay $ 1.23 for ad placement.
  • Second, the costs of advertising on Facebook can fluctuate, and by a lot.

One day your cost-per-click might be $ 1.23, and a week later, it might have gone up to $ 3.12. So never forget about it.

Always keep an eye on the costs of Facebook ads in order to implement the most effective strategy for your eCommerce and for your budget.

6 factors that influence the cost of Facebook ads

As we said, there are a number of factors that influence the cost of advertising on Facebook – here are some of the most important variables.

1. Your target audience

Reaching people with a certain demographic and psychographic profile has a higher cost. So, if you’re targeting a particularly sought-after audience, your Facebook advertising costs will be higher.

It is purely about supply and demand.

As a result, you may feel tempted to limit your target audience to narrow your audience, but be careful.

Creating a smaller target audience can lead to higher costs because there is less space available for ads.

The trick is to find the right balance, or the balance that works best for your business, and to do this, you never have to stop testing and trying new strategies.

2. Your marketing goal

When you create an ad with Facebook ads, Facebook will invite you to choose a marketing goal.

The marketing goal of your choice can heavily affect the cost of advertising on Facebook.

In general, making sales costs more than just promoting your brand. In other words, conversions often cost more than clicks, which usually cost more than video views.

Of course, it all depends on what your goals are, and you may even have different goals at different times!

3. Your competitors

This is undoubtedly the main factor influencing Facebook ad costs.

Why? Again, basic economics: supply and demand.

If there were no other companies trying to reach the same target audience as you, there would be no demand, and therefore your Facebook ads costs would decrease.

But let’s get back to reality.

Your marketing costs will largely depend on how many competitors you have, how much they are willing to spend, and what their relevance rates are.

This is another reason to always keep an eye on your competitors and their marketing strategies.

4. When you choose to advertise

Competition increases during peak periods.

As a result, you can expect Facebook advertising costs to increase in the run-up to Christmas, Black Week, or other holidays.

In addition, the day of the week and even the specific times you run your Facebook ads will affect the cost of the ads. So, deciding when to post your sponsored posts on social media will impact the cost of your ads.

5. The positioning of your ad

There are several placements available for your Facebook ads :

Here is a short list of the placements available for Facebook ads:

Facebook

  • Feed
  • In the article
  • In-stream video
  • Right column
  • Marketplace
  • Stories

Instagram

  • Feed
  • Stories

Messenger

  • Messages
  • Sponsored posts

Sites and apps

  • Banner
  • Interstitial
  • Natives
  • Awarded video
  • In-stream video

Ads on Facebook have variable costs also based on positioning.

6. Your relevance score

Relevance Score is a Facebook metric that evaluates the relevance of your ad to your target audience.

As users interact with your ad, its relevance score increases. However, if many users ignore your ad or click on “this ad is not relevant”, your score will decrease.

This is extremely important.

If your ad gets a high relevance score, it will be favored by the Facebook algorithm and may even cost less for the same placements.

It is therefore vital to make sure that your sponsored posts are relevant to your target market; otherwise, you will not only spend money unnecessarily on ads that don’t work, but you will also be penalized by the platform’s algorithm, and your subsequent ads will have a higher cost.

8 strategies to reduce the cost of Facebook ads

Now that you understand what the main cost factors of Facebook ads are let’s see how you can reduce your advertising spend on this social network.

While there are many factors beyond your control, these eight strategies are sure to help you achieve a greater return on investment (ROI).

1. Test a / b

A / b testing is the process of running the same ad campaign twice with a small tweak to test its performance.

A / b testing helps you continuously improve your ads for better performance. This will reduce the cost of advertising on Facebook, improving your return on investment.

Too many advertisers just create an advertising campaign on Facebook and abandon it immediately after creating it, or forget about it.

Do not do it.

Some companies have managed to reduce their Facebook advertising costs by 96% by simply editing the text! In other words, there’s no way to tell what works best until you try it for yourself. On the other hand, every business and every audience has different needs.

The good news is that the Facebook Ads Manager makes it particularly easy to run a / b tests.

In the “Traffic” section, simply activate “Create a / b test.” Facebook will take care of dividing your budget equally between the two ads and will allow you to measure their performance.

Ideally, your goal is to test each part of your ad individually, but start by testing your image and text.

2. Focus on one goal at a time

When you start creating a Facebook ad, the first thing you need to do is choose a goal.

Whatever your choice, make sure every part of your advertising campaign aligns with your goal.

Trying to combine two goals into one ad won’t earn you more. In fact, it will almost certainly increase your Facebook ads costs and get the opposite effect to what you intended.

Why?

Each goal has a different function and requires different messaging, audience, text, and images.

You need to keep your ads highly targeted.

When you focus on one goal at a time, you can make sure your image, copywriting, audience, and call to action get right to the point and create conversions.

If you want to focus on more than one goal, create more campaigns and more ads.

Eventually, you will see that this strategy will help you reduce your Facebook ads costs.

3. Maintain a high relevance score

Relevance score is, as we have seen, a Facebook metric that evaluates the relevance of your ad to your target audience.

A high relevance score means your ad is receiving positive feedback and optimal levels of engagement, clicks, and conversions.

High-scoring ads lower the cost of Facebook ads.

The secret here is to simply create effective ads that resonate with your target audience.

4. Keep an eye on the frequency

Facebook keeps track of the frequency of each ad, which is how often the same user views your ad.

If the same people see your ad multiple times, one of two things happens:

  • You don’t reach new people
  • The people, you are contacting continue to see your ads but do not convert

The higher your frequency, the less interaction, clicks, and conversions you will get. As a result, your Facebook advertising costs will increase.

It is true that some people will need to see your ads a couple of times before clicking on them and converting into customers. However, interested buyers usually only need to see them once or twice.

So, try to keep your ad frequency at three or less.

If your attendance score gets too high, stop and edit or stop the campaign.

5. Update your ads

You need to update your ads and create new ads on a regular basis.

In addition to helping keep attendance scores low, it’s a good habit. No matter how effective your advertising campaign is, it is likely to eventually lose its impact.

However, this doesn’t mean you have to start from scratch every time.

You can keep the same audience but change your offer, image, or content. Also, take what you’ve learned from a / b testing and apply it to your new advertising campaigns.

6. Choose an audience for each campaign

Each campaign should have a personalized target audience.

In other words, you shouldn’t include your entire target audience in every campaign you run. This will increase the costs of Facebook ads.

Why?

Well, users will be at different stages of the sales funnel and, as a result, will request different advertising messages.

By segmenting your target market into sections and subsections, you will be able to create highly targeted messages, offers, and calls to action.

The result? Better ad performance and lower advertising costs on Facebook.

For example, let’s say you want to run a campaign to connect with new potential customers. It would be inefficient to show these ads even to people who have already liked your Facebook page.

Instead, you can ban these users, and suddenly your target audience will be much more likely to engage with your content.

Facebook offers countless audience targeting options; it’s up to you to take advantage of them!

7. Use retargeting and remarketing campaigns

Retargeting and remarketing are marketing strategies that allow you to advertise to people who have already been exposed in some way to your business.

  • Retargeting is the process of showing ads to potential customers based on their browser cookies (using the Facebook pixel)
  • Remarketing is the process of serving ads to potential customers based on email interactions.

In other words, if someone has visited your website or joined your mailing list, they will be able to see your ads on Facebook.

These people are already familiar with your brand and your products, so the foundation is already there for establishing a relationship and retaining them.

As a result, retargeting typically results in more clicks and conversions and lower advertising costs.

Facebook also offers many remarketing options.

You can show your ads to people who have liked your Facebook page, who follow you on Instagram, who have subscribed to your mailing list, and much more.

Another interesting aspect is that the creation of campaigns of this type for the sale of products can be partially automated thanks to Facebook Dynamic ads: with this type of ads, in fact, the social network will show the most suitable product for the potential customer based on the story. Of interaction that the person has with your company.

8. Limit your offer

This is the easiest way to keep Facebook ads costs down.

If you know you don’t want to spend more than $ 1 per ad, you can simply set a limit on your maximum bid to make sure you don’t spend more.

Of course, this means that you could be missing out on potential ad placements.

However, if you have a marketing budget plan and need to keep Facebook advertising costs under control, setting a cap is the way to go.

8 Facebook advertising metrics to know by heart

Here is the list of important Facebook advertising metrics to consider:

  1. Impressions
  2. Reach
  3. Repetition
  4. Link Click-Through Rate (CTR)
  5. Cost Per Acquisition (CPA)
  6. Cost Per Click (CPC)
  7. Cost Per 1000 Impressions ( CPM)
  8. The relevance index

To schedule an ad, you have to go to the Facebook ad manager. It is the tool that allows you to create and manage them.

Facebook offers various fairly extensive options depending on your goals (we will come back to these options in detail in a future article).

Facebook ads are very often used by Social Media Managers to find customers on Facebook.

Facebook advertising acronyms

Once the publicity has been created, we enter the jungle of exotic acronyms.

Facebook makes it possible to analyze and track its advertisements with great precision. It’s a great tool.

The only problem is that it takes a little time to get started and to fully understand all the proposed indicators. They are very numerous (visits, rate of the result, request for an offer, cost per like of the page, number of views for a video at 10 seconds, 20 seconds, 30 seconds…), but not all of them are useful!

Most of them answer extremely fine and precise questions that you don’t necessarily need.

So let’s focus on the 10% most important indicators when starting a business.

What are the most useful Facebook advertising metrics?

1. Impressions

The number of impressions refers to the number of times your ad has been viewed.

In your ad manager, impressions are available in the “Delivery” column.

It is an important indicator but which, on its own, does not mean much.

Looking only at the number of impressions of an ad is not enough to tell if it is performing or not.

For a relevant analysis, you must cross the number of impressions generated by your advertising with other indicators that I will tell you about.

There are no magic numbers for how many impressions an ad pays for. But overall, from around 2,000 impressions, you start to have a certain trend.

2. Reach

Reach is the number of people who have seen your ad at least once.

This is fairly close to the number of impressions. The difference is that impressions can include multiple views of your ad by the same person.

The number of impressions is therefore necessarily greater than the reach.

These two indicators are very close to each other. They are especially relevant for campaigns with a retargeting objective. This type of campaign does not aim to find new people but to re-display its advertisement several times to someone who has already seen it.

Facebook also gives a potential reach between 2 values. It is the approximate number of people your ads can reach based on your targeting criteria.

If your reach is high, it means that your ad is well shared or that users interact with it (comments, likes…). You, therefore, improve the engagement of your Facebook page.

Remember, when a user comments or likes a post on Facebook, their friends can see it in their Facebook News Feed. Which therefore increases the scope of it!

3. The repetition

Repetition is the average number of times each person has seen your ad.

The number of repetitions is indicative of the gap between the staff and the impressions.

Repeating your advertising message too much represents a big risk for your online reputation. Unlike traditional advertising, users can directly judge your sponsored content… and hide it (or worse, report it)!

Moreover, Facebook sets limits on this repetition. If you over-expose the same people to the same ad content, your appearance in the News Feed will be limited.

We generally recommend keeping a repetition less than 3.

So remember to vary the angles so as not to “bore your readers” with similar content.

The goal is always to provide relevant and interesting content. Repetition is one of the essential Facebook advertising metrics!

4. Link click-through rates (CTR)

CTR is the percentage of times people saw your ad and clicked on the link. If this rate is too low, it means your ad isn’t captivating enough, and people aren’t clicking on it.

It doesn’t mean that your advertising is bad, just that the message X you send to an audience Y is not suitable. Besides, Facebook realizes it and will do nothing to help you.

You must therefore re-work your message so that it speaks well to your persona.

The click-through rate should be high because it shows that your ad is relevant and that the people you are targeting are interested.

5. The cost per acquisition (CPA)

The CPA will allow you to assess the profitability of your campaign. It can be found in the “Performance” column in the Facebook ad manager.

CPA is similar to cost per result (CPR), cost per lead (CPL), or cost per download (CPD). These are derivatives of cost per acquisition.

It just depends on the campaign goals (eg, you will use CPD if your goal is to download your app).

Concretely this indicator represents the average cost that you pay for a person to carry out the action that you want.

If your goal is to get people to sign up for a webinar and the CPA is $ 10, that means you’ll need to pay $ 10 for each new person who signs up.

Analyzing your CPA without taking into account what’s going on behind it makes little sense. CPA is a key Facebook advertising indicator!

6. Cost per click (CPC)

CPC refers to the average cost of each click on a link.

This indicator is very useful if your objective is to bring back traffic like sites or blogs.

If you want to convert your visitors behind (make them buy a product, for example), this indicator is not the most relevant to follow.

7. The cost per 1000 impressions (CPM)

Here we do not pay for the action, the click, or the conversion, but the simple fact that the advertisement is exposed to Internet users.

It can be found in the “Distribution” column of the advertising manager.

What is this indicator used for?

Typically to compare audiences in similar markets. For example, the cost may be different in America and Belgium because the advertising pressure will be more or less strong depending on the region or country.

This is important for testing audience potential.

8. The relevance index

The relevance index is a score from 1 to 10 assigned by Facebook, which assesses the degree of relevance of your advertising in relation to your audience.

This score appears once your ad reaches more than 500 impressions.

It is only visible in ad reports and does not appear in ad sets or campaigns.

It indicates whether the message you delivered to your audience was relevant, i.e., whether it captured the interest of your target.

It is an interesting indicator to follow. If we get a bad mark, we can say to ourselves that we have not chosen the right angle, which allows us to rectify the situation.

Here are the 3 Facebook advertising metrics that are essential to follow:

1. The cost per acquisition (CPA)

This is the basis. If your cost per acquisition is good, you can let your ad run.

If it’s not good, you should quickly think about stopping your advertising because it is not relevant enough for your audience.

It is the most rational and objective indicator there is.

2. The click-through rate (CTR)

By creating variations that will generate more clicks, you will be successful in some way in lowering your CPA.

But don’t race for clicks. If you get a really good click through rate, but behind your CPA is poorer, that’s a problem.

Of course, you will have sought the click by interesting your audience, but if behind there is no conversion, you will have generated clicks for nothing …?

It can even be sanctioned by Facebook, which considers that you are artificially improving the popularity of your posts. Facebook sees this as bad practice: “Clickbait” or click bait.

3. The repetition

We don’t talk about it enough, but there is a phenomenon called ad fatigue.

If you subject users to too many advertising messages in too short a period of time, you will annoy them, and your click-through rate will drop drastically.
These same people will be fed up with receiving your ads. Either because you are not on the right audience or because you have been too aggressive. If your repetition goes above 3 , your CPA will start to decrease.

Do not hesitate to test new formats. You have to try different types of ads over and over again before you get a feel for what works well!

How much should you invest in Facebook Ads monthly?

Anyone who uses Facebook for business purposes sooner or later realizes that it is not free and needs constant investment to bring results.

Yeah, but how much to invest? How to distribute the budget between the various objectives that Facebook offers, to balance between creation, maintenance, and animation of the community and objectives more related to the acquisition of contacts and sales?

What I would like to give you in this post is not the exact amount to invest (you decide it together with the customer, and there are so many variables that intervene in determining it that it is impossible to give one that is right for everyone), but a series of indications to follow to determine this budget and how to distribute it for best results.

And, at the very least, a basic budget to start with.

What is the minimum amount to invest in Facebook Ads?

You can do Facebook Ads starting from one euro a day; however, I doubt you can have great results by investing such a figure.

Invest in Facebook ads

Speaking of micro-enterprises, already with 100 dollars a month, if well managed and distributed (we will see it shortly), you can have respectable results; obviously, everything depends on the objectives you have (ok, for microscopic activities, even 50 dollar per month is a start).

If your boss/customer wants to reach 150 contacts and acquire 30 new customers a month via Facebook (even there, we understand according to which attribution model, perhaps), tell him that he certainly can’t think of getting there with a cost of 100 dollars (to unless they are retargeting campaigns on highly qualified segments); to which he will tell you “ah yeah? And in your opinion how much should I spend to achieve these results? ” , answer him with indicative data if you have a history of similar cases, vice versa let him know that you will have to do some tests and based on those, once you understand that CPL (cost per lead) and CPA (cost per acquisition) to expect, calculate how much it should amount to the expense to achieve the target results.

Obviously, the bigger the company, the more budget it has available, some customers invest thousands and thousands of euros per month, distributed for the various objectives; in fact, the investment must be commensurate with the results.

I recently followed the set up of a series of campaigns for a customer who had allocated 10k for lead acquisition and after the test period, having seen that Facebook’s CPL was significantly lower than other channels (eg, Adwords) and quality leads, doubled the budget for the following month.

If the results are optimal, the customer/boss should be the first to want to increase the budget, right?

Let’s test and see what we can bring home.

How to distribute the budget for Facebook Ads?

Direct-response-immediately-super-business-oriented objectives aside, I recommend that you always plan a part of the budget for campaigns with a goal of interaction (inside and outside the fan community) / fan acquisition on a monthly basis, precisely because engagement is and remains the main engine of any business initiative on Facebook.

If you are wondering, “but is it worth investing in fan acquisition?” , I talked about it here.

In fact, they are and remain your primary audience as regards the posts you share organically (not paid) on your Facebook page, not to mention the fact that they act in terms of social proof, both on the page and associated with ads (see if a brand with 50 fans has the same effect on you as compared to one that has 50,000).

How much do you dedicate to interaction/fan goals? Well, it really depends on how old the page is and how it was built over time.

Without a fan base, it’s hard to get word of mouth, and a fan base that never sees you can hardly be an active fan base; for the first few months, we aimed at creating the community, then moving on to the primary objective of the customer, that is the generation of leads/sales (yes ok, you can use the Facebook page even just as a “base” for your advertising campaigns, but not is great for presenting your brand and retaining customers).

Obviously, a part of the budget also goes into retargeting campaigns (which, if well done, bring fantastic results) and which it is always advisable to include in a monthly spending plan.

The important thing is not just how much you spend, but how you spend it; For example, if you deal with small activities (e.g., budget 150 dollars/month), it can be an excellent idea to balance the monthly budget by ensuring that audience engagement is not lacking (30 dollars between video viewing/engagement), traffic qualified to blog (40 dollars) and the generation of sales and promos through retargeting, use of personalized audiences and drive to store campaigns, if you operate offline.

Tips for investing in Facebook Ads

The budget must be distributed according to the primary objectives of the brand/customer, always keeping in mind to leave a small part of it also to maintain attention, stimulate involvement and grow the community.

Every month (or at least every quarter) distribute the budget according to the priorities and the results achieved: allocate more budget to the best performing campaigns and to those that bring the best results in terms of contacts and sales or according to your objectives (which could be, in a first phase, even of simple awareness)

Conclusion: how much do Facebook ads cost

That said, the only way to know what your Facebook advertising costs will be is to try it out for yourself. So, try running some campaigns and go from there.

Remember, there are six key factors that influence the cost of your Facebook ads:

  • Target audience
  • Marketing goal
  • Competitor
  • When advertising
  • Ad placement
  • Relevance score

To reduce the cost of advertising on Facebook, you can:

  • Do a / b tests
  • Focus on one goal at a time
  • Keep relevance scores high
  • Keep attendance scores low
  • Update your ads
  • Select a specific audience for each campaign
  • Use retargeting and remarketing
  • Limit your offer