The identity of Facebook as strictly a social platform is a thing of the past. It has turned into one of the most potent commerce and marketing tools, and we have Facebook advertising to thank for a lot of it. Needless to say, in the 21st century, Facebook Advertising is a vital element to your business. However, even now, not many people know how to leverage it correctly and on what budget. In fact, the most common question asked after Facebook Ads is, “How much does Facebook advertising cost?”
If you are wondering the same thing, then look no further because I present to you the ultimate guide to Facebook Advertising. Whether you have hired someone for digital marketing or want to take on the feat yourself, it’s useful to know how much does it cost to advertise on Facebook.
In this post, I will be covering the following aspects:
- Expensive Mistakes – And How To Avoid Them!
- Factors that Impact Facebook Advertising Cost
- Average Facebook Ad Costs
- Best Practices for Optimization
- Leads and Lookalike Audiences
- Efficiency Tests
- Relevance Score
- Attention to Detail
Before launching into all of this, though, let me pinpoint one of the most important things you need to know about Facebook advertising: it will never cost more than you are willing to spend.
Sure, what you can get out of the service will vary significantly according to how much you spend – but the fact is that you can easily mold it around your budget!
Yes, Facebook Ads are not as expensive as most marketers would iterate. They are perceived as costly because people try to utilize them without a clear focus and strategy. That’s a big NO.
Diving into the world of Facebook Ads can be a colossal mess if you do so without a proper plan, so it is of utmost importance to craft a comprehensive strategy that entails how you plan to use Facebook advertising.
That being said, let’s get into the good stuff!
Expensive Mistakes That Increase Facebook Advertising Costs
If you are a small business that has to take care of website maintenance and web development, even a penny matters! Facebooks ads cost a lot – but only when you make some extremely detrimental mistakes. Let’s have a closer look at what these are.
1. Going In Without a Strategy
The first mistake that you can make is pursuing your ad journey without having an effective plan. This is an absolute basic and yet is ignored to a terrifying extent. You can simply not fall into the rabbit hole of Facebook ads, which you will if you don’t have a clear-cut strategy!
2. Having Expansive Targets
Targeting way too broadly is something you desperately need to steer clear of. This is one of the most frequently made mistakes, and part of it has to do with the fact that Facebook gives you way too many options to choose from!
The vast selection can leave you bewildered and lead you to make choices that will result in wasted money.
Here are a few tips on how to ensure that you aren’t targeting too broadly:
- Select the relevant age range:
You must ensure that the age range you select for your Facebook ad is as close to your target demographic as possible – this will actively keep out people who are too old/young to understand the need for your project.
- Target exact interests:
You must target the same interests you want to draw from your audience. Do not keep your interests vague – let go of your broad-minded approach and instead restrict yourself strictly to the concept you want to present to your target user. A few specific interests are indubitably better than a long list of abstract interests.
- Target to your market:
Again, be specific! If your target market falls into a particular area of a country, a target that specific area instead of the entire country!
Here’s the thing; Facebook allows you to really expand your business and target multiple regions. But what’s the point of it when it doesn’t work? Therefore, don’t let the magnitude of Facebook’s ability misguide you – stick to what matters.
- Keep in touch with the estimated audience reach:
It is vital to keep an eye on your estimated audience reach. This will help you figure out your approximate audience size and ensure that the targets you set for yourself are neither minute nor massive.
3. Running Facebook Ads Without a Test
Honestly, why? Why would anyone spend hundreds of dollars on a campaign that hasn’t even been proven? This is one of the biggest mistakes you can make!
The need to get faster results will always be there, but you must balance that need against your best interests. ALWAYS run a test before the real deal. Always.
Come up with multiple creative strategies and run a test accordingly, and then determine the rest of your budget in accordance with that.
Factors that Impact Facebook Advertising Costs
Now that we have discussed the most significant mistakes you can make, let’s come to the few things you need to keep in mind when figuring out your ad campaign’s total cost on Facebook. It’s evident that some factors are going to have a considerable effect on your budget. These elements primarily include:
- Audience
- Ad quality
- Season
- Ad placement
- Industry
- Ad objective
These aspects monumentally impact your ads. How? Let’s have a look.
Audience – Focus on Those Who Matter
Your audience profile dramatically impacts the overall cost of your Facebook ads. You will see a shift in your expenses in accordance with your focus on age, gender, or interest.
If you focus your campaign on the people that truly matter and are likely to be interested in your product and are likely to invest in it. Having the wrong audience profile can result in having to pay for clicks and views that offer no value when it comes to the long-term objectives of your business.
Ad Objective – Set Sustainable Goals
When creating an ad on Facebook, you are required to choose one of the following main ad objectives:
- Awareness
- Consideration
- Conversions
Along with these objectives come specific goals that you will have to choose from.
For Awareness, the goals are:
- Brand awareness
- Reach
For Consideration, the goals are:
- Traffic
- App installs
- Engagement
- Video views
- Lead generation
- Messages
- Product catalog sales
For Conversions, the goals are:
- Store visits
- Conversions
The more valuable your ad goals are, the more they lead to higher ad costs. For actions that have immediate value for a business like product catalog sales, the prices will definitely be higher, so that’s one thing you need to keep in mind before you determine your ad objectives.
So essentially, you have to pay more if you are getting more as well – the choice is totally yours to make.
Ad Placement – Deciding Where Your Ad Goes
Another factor that affects advertising costs on Facebook is the ad placement also shapes the value of Facebook allows your ads to appear in six of the following spots possibly:
- Facebook desktop newsfeed
- Instagram Stories
- Facebook right column
- Audience Network
- Facebook Messenger
The costs vary from platform to platform, but generally, Instagram has the highest CPC in regard to Facebook advertising.
Ad Quality – The More Engaging = The Better for Your Budget
The quality of your ads also has an impact on how much Facebook advertising costs. The higher your relevance and engagement score, the lower the cost.
Facebook essentially rates your ad between 1 and 10. Ten is the highest possible score that you can get, whereas one is the lowest possible score. Aim for the highest if you want the lowest cost!
Season – Is it That Time of the Year?
This one is criminally underrated. We all know that the cost for real-time advertising varies from season to season, but did you know that the same works for digital ads too? Yes, the time of year can also impact how much you pay for your Facebook ads!
This is mainly because businesses tend to spend more on advertising during shopping seasons, which results in an increased demand for ad space. This creates a highly competitive market for advertisers, involving giant bids and campaign budgets, thereby inflating Facebook’s advertising cost.
Look out for the following occasions, as they are the most expensive times of the year for you to advertise:
- Thanksgiving
- Black Friday
- Cyber Monday
- Christmas
- Boxing Day
- New Year’s Eve
- New Year’s Day
In my opinion, the increased costs during the holiday season shouldn’t be a put-off because, at the end of the day, you’re also driving profit from the increased demands.
If anything, you should be taking advantage of the situation! Increase your ad budget during the peak season and mold your ad strategy to perform well during those high-demand months!
Industry – The Type of Your Business Matters
The average Facebook advertising cost is $0.97, but it can vary from industry to industry! So, you can gain full insight into your expected Facebook advertising costs by looking at the average price of Facebook ads for the particular industry of your business.
Here are the tentative, average Facebook advertising cost for each industry are as follows.
- Apparel – $0.45
- Auto – $2.24
- B2B – $2.52
- Beauty – $1.81
- Consumer Services – $3.08
- Education – $1.06
- Employment and Job Training – $2.72
- Finance and Insurance – $3.77
- Fitness – $1.90
- Home Improvement – $2.93
- Healthcare – $1.32
- Industrial services – $2.14
- Legal – $1.32
- Real Estate – $1.81
- Retail – $0.70
- Technology – $1.27
- Travel and Hospitality – $0.63
How Much Does It Cost To Advertise on Facebook – Average Facebook Advertisings Costs
It is useful to understand that there are average costs associated with Facebook advertising. To understand this, we must focus on the “Optimization & Pricing” section that you’ll be able to access when creating or editing an ad. This then leads you to the options as to how your ads will be delivered to your target audience.
Here’s the thing: when you are building out an audience, the ultimate objective is not to target everyone. Facebook has the incredible ability to take your price range and deliver your ads to the specific people that it considers likely actually to fulfill the desired action.
Regardless of your ultimate objective, Facebook positions you in an auction system that considers a plethora of factors before finalizing the price you pay to “Reach” the desired audience for your desired outcome.
In essence, the number of people who take your required action determines how much you pay to reach the audience and your campaign’s overall cost.
Moreover, Facebook advertising cost is also impacted by the fact that you have the imperative to choose to be charged for different metrics within your objective. This is what I mean:
This allows you to be charged CPM – your ad will be shown to your “reachable audience” as many times as possible by Facebook, and you will be charged per 1,000 impressions. With this option, you have to stay wholly vigilant and keep an eye on the frequency because it is bound to maximize quickly.
Remember, you can always try out different methods and see which one would suit your venture the best! It’s good to play around and try a few other things and see what works for you when it comes.
In case you’re wondering what the average Facebook CPM is for different methods, here’s a list.
- First -cost for Impressions: The average price is $7.19 per impression.
- Second – cost for Likes: The average price is $1.07 per like.
- Third – cost for App Installs: The average price is $5.4 per download.
Best Practices – Optimize Your Facebook Advertising Cost to Maximize the Success of Your Campaign
Now, calling you to the action! What should you be doing?
You obviously want to generate sales, at the lowest possible cost. It would be easier for you to hire a marketing agency to provide you with digital solutions, but you can always take the following steps yourself to lower your Facebook Advertising costs.
Leads and Lookalike Audiences
You can upload a custom audience of customer emails/leads in order to enhance the core of interest-only targeting.
First, you should create a base profile of the individuals you want to be a part of your audience. That’s the essential part.
Later on, you can add interests and behaviors if you’re going within your objective or deemed necessary. You can also exclude your existing customer audience so that they never see your ads, and you don’t waste impressions on them!
Efficiency Tests
After sorting out the audience profile, you must run tests in order to ensure that you aren’t wasting your money. This is how you can run a test:
- Set up ad sets with variable yet similar target audiences
- Set the daily budgets low so that it can be spread across all your ad sets
- Construct one to three competing ads for each ad set
- Observe which ad Facebook favors. It automatically selects the higher performing ad, so this shouldn’t be very challenging to execute.
These steps will help you because the ads and ad sets that work will automatically rise to the top, which enables you to focus your full budget on an ad that is going to be successful.
At the end of the day, your goal is to save money and increase your sales, not waste it on things that don’t work. So, testing is essential!
Relevance Score
By now, I’m sure you are rummaging this essay to find that one tip that will ensure that the cost of your Facebook ad runs low.
Well, that tip happens to exist in the form of your relevance score. You can drive a high relevance score from the engagement of your ads. The more engaging your ads are, the higher your relevance score will be.
Moreover, your relevance score will vary from ad to ad. So within one ad set, you’ll see that each of your ads has a different relevance score based on a variety of factors.
This is useful because you can see which of the ads have a higher relevance score and then use them as a model for any future campaigns! This saves you money, time, and effort, and hence, it is an excellent practice to get into.
Attention to Detail
Always remember that you are competing for attention when it comes to your ad campaign/ Because of this, your ultimate goal should be to create an ad that is as captivating as possible.
The more attractive an ad is, the better payoff you’re getting for your money. This aspect also relies on good copywriting, so make sure the content you’re integrating into your ad reflects your brand’s personality!
Facebook Advertising Costs – The Key Takeaway
Wrapping things up, please remember what I mentioned at the beginning of this post: Facebook advertising cost as much as you want them to cost! What you get out of your campaign is obviously going to differ in accordance with how much money you’re willing to spend – but the good thing is that Facebook gives you a lot of control and choices to choose from.
Ultimately, Facebook ads are merely a reflection! Either way, the tips mentioned above can be useful if right incorporated into your ad strategy, so keep them in mind the next time you run an ad campaign.
I understand that the information we have discussed today is a little overwhelming, but remember, you can always hire an online marketing agency to help you with the workload and make the task much less challenging and a lot more lucrative for yourself and your business.
