How Much Should I Spend on Facebook ADs

WP Marketing

We get this question by every client when entering into the advertising space, when really the question should start with what are your goals. There are three things that are very important in the Facebook AD space:

The end result, the offer & your goal. So before I get into the 3 ways to determine your ad spend let’s consider some important components that determine what your spend will be. 

The END RESULT

What is your sales process? How long is your funnel? If you are a business that has a sales team ready to call a lead within 15 minutes of execution, the amount of people you need to reach before you reach your goal may be less than someone who needs to nurture the audience with an email sequence [especially if its a cold audience].

The OFFER

Your product may be great, your service may be the best, but have you positioned it to be successful? Some offer examples may be : free shipping, 5 recipes for guaranteed weight loss, 7-steps to explode your sales.

Your GOAL

Simply put, how many sales do you want to make which brings us to the breakdown:

Please note: Meta is the entity and this encompasses Facebook and Instagram.

3 Ways to Determine Your Facebook Ad Spend

General Rule of Thumb

According to Facebook, (by their Marketing team) the following daily budgets are recommended.

  • $25 per day for brand awareness ads
  • $25 per day for traffic ads
  • $25-100 for conversion or lead generation ads

Although a good start these are general and may not be conclusive for your industry.

Testing + Multiplying

This method is very accurate. It is implementing the creatives (ad photo/video and caption) at a low cost per day and assessing the results. The more that the result you are looking for occurs, the better Facebook can optimize for this result. 

Therefore, if you run your ads and you obtain 100 clicks at $.15 per click you know that if you want 1000 clicks, your approximate budget should be $150.

Now lets take it a little further, now if out of those 100 clicks only 15 made a purchase, but you know that your sales goal is 30 sales, then your approximate budget should be $200.

Industry Standards

Below you will see a chart by Ruler Analytics which lists conversion rates by industry. This lets you know based on the amount of traffic you send to your website, what amount you can expect to convert to a customer. If your industry is not there or if you want to niche down for more accurate information, it should be fairly easy to find via google.

You will also need to know the cost per 1,000 impressions for your industry. The average range is $3-$10 per impression.

Lastly, you will need the average click through rate and sales conversion rate. 

What you want to do next is use our calculator, which would give you an accurate assessment based on your industry. 

 

Here is the link to the calculator:

Calculator

 

 

Get started today with our free 7-Step Ad Kit

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