Want To Know The Secret To Lower Your Facebook Ad Costs?
We’re excited to talk about lowering your Facebook ads costs.
And that’s because we know how maddening it can be to see that cost slowly go up… and have no idea how to fix it.
But first, are you spending more and more time marketing your business? Do you kind of love digital marketing?
Welcome to the club! It’s a fun one.
In this post, we’re going to give you 5 tips on how to lower your Facebook ad costs so you can make the most of your budget.
But if you want to learn more about how to run successful ads on Facebook (from people who’ve actually done it)…
…check out our new social media ads webinar by Sherman, one of our co-founders.
So, let’s go ahead and learn how to lower the cost of your Facebook ads!
Why Are My Facebook Ad Costs Going Up?
If you’re noticing that your ads are costing you a lot more than you thought (or more than you’d like)…
…or you see your ads slowly start producing less results but you’re spending the same every month, you may be paying too much for your ads.
This can be especially frustrating if you don’t know why your ads are behaving this way when they were doing well before.
From years of managing ads and watching them go through every life cycle imaginable, we can tell you, we get that feeling.
And we’ve been there, like you, staring at those ads wondering why in the world they decided to stop now.
We’ve learned a lot from working on so many ads across industries, and we’ve found that most of the time, Facebook ad costs go up for a few simple reasons.
We’ll go over these in more detail next.
- You’re not using retargeting.
- Your ad frequency is too high.
- You’re not changing your ad formats or messaging.
- You’re relying on automated placements only.
- You don’t pay attention to your relevance score.
If you want to lower your Facebook ad costs, keep reading.
5 Tips For Lowering Your Facebook Ad Costs
Tip 1: Start Using Retargeting Ads
Tip 2: Keep Your Ad Frequency Below 5
Tip 3: Change Your Ad Formats and Messaging
Tip 4: Don’t Rely On Automated Placements
Tip 5: Pay Attention To Your Ad’s Relevance Diagnostics
Digital marketers like us don’t use Facebook because we love the platform or are huge Mark Zuckerberg fans. Shocking, we know.
We use Facebook to advertise because of the targeting options. And the magic in Facebook targeting really comes once you start using retargeting.
Retargeting ads show to people who have interacted with your page, website, or content in some way before.
These ads work well because you’re showing them to an interested audience.
You have a bunch of Facebook ads targeting options (we got all of this verbatim from the Facebook Help Page):
a. Viewed or Added to Cart But Not Purchased: Promote products from your catalog to people who viewed or added those products to their cart.
b. Added to Cart But Not Purchased: Promote products from your catalog to people who added those products to their cart.
c. Upsell Products: Upsell products from your catalog to people who viewed products from your product set.
d. Cross-Sell Products: Cross-sell products from your catalog to people who viewed products from your product set.
e. Custom Combination: Promote products from your catalog to a Custom Audience based on how people interacted with your products.
If you choose this option, you can select the audience interactions taken by selecting inclusions and exclusions.
For example, you could include people who added products to their cart in the last 45 days and exclude people who purchased products in the last 45 days.
We’ll show you how to set up retargeting ads assuming you’re selling products online.
We prefer to use Dynamic ads in these cases, so we’ll show you that option. You’ll need to have two things in order to run these ads:
- Facebook pixel / App events properly set up and collecting data
- Set up your Catalog
How to Set Up Dynamic Retargeting Ads in Facebook:
- Start creating your Dynamic ad.
- When you select your audience, choose Retarget ads to target people who interacted with your products on and off Facebook.
- Choose a retargeting option (we covered those just a couple of minutes ago).
- Enter the number of days where the action occurred for your retargeting option.
- (Optional) Select Show Advanced Options to add a Custom Audience or Lookalike Audience to your targeting.
If you want to see a walkthrough guide for this, then check out the video at the top of this post.
This should lower your Facebook ad costs, and increase your click-through and conversion rates.
Pay attention to your frequency when running retargeting ads.
This refers to how often each person sees your ad.
And that’s because if those numbers get too high (over 5), you can annoy your audience and risk losing customers.
If you don’t have a retargeting audience yet, you need to build one. You can do this in a number of ways, but here are our favorites:
- Promote a freebie or some other offer to get email sign-ups on your site.
You will upload your email list once you have 1,000 contacts, and retarget them using that.
You can retarget email subscribers and those who visited your site or clicked on your ad.
- Run an ad campaign to get video views.
Retarget viewers based on how long they watched.
- Run dynamic catalog ads to a general-interest audience for a couple of weeks.
Retarget those folks who clicked on your ads, visited your website, and/or added products to their cart.
You’ll need to ensure your pixel is set up properly for this option to work.
Format these ads for folks at the top of your marketing funnel. You’ll want the initial ads they see to be related to your next set.
It wouldn’t make sense to get a bunch of clicks by running an ad for one thing, and then retargeting with something else.
You may have the “if it’s not broken, don’t fix it” kind of mentality when it comes to your ads.
And while this idea can apply generally, it can be detrimental to leave your ads unchanged for long periods of time. Even if they are working.
When we first started running ads, this wasn’t something we understood fully. We weren’t paying attention to how often ads were showing.
We cared way more about clicks or conversions.
But that means we weren’t able to identify the connection between increased cost and decreased performance.
We would look at ads confused about why they’re still converting but costing so much.
While we were writing this post, we came across this quote from AdEspresso’s Tory Wenger regarding the relationship between frequency and cost.
“We analyzed over 500 campaigns and found that ads with a frequency of nine had a CPC that was 161.7% more expensive than ads with a frequency of one.”
How is your frequency calculated by Facebook?
Facebook tracks how often your ads are shown, on average, to each person in your audience.
The frequency number is Facebook’s best estimate of how many times each person in your audience has seen your ad.
When should I change my ad creative? What is a good frequency?
You typically want to keep your frequency between 1 and 4.
When we see ads we’re running hit a 4, that’s when we know it’s beyond time to freshen up the creative.
How can I keep my frequency low?
Aside from watching that number and keeping your creative fresh…
…you can do a couple of other things to try to extend the life of your ads and keep that frequency from shooting up.
Using Dynamic Ads can help you avoid having to manually switch up creative every couple of weeks.
If you give Facebook enough interesting combinations, you can use those ads for much longer than others before your frequency starts to climb.
This will depend on the size of your audience and how many options you uploaded.
Here’s how to find the frequency in your ad account:
- Log into your ad account.
- Navigate to the Campaigns, Ad Set, or Ad tab.
- If the frequency isn’t one of your available columns, add the column.
- Click the blue plus sign and find “Frequency” from the list.
- Check to add it and click Save.
- Now you can see the numbers in the new column.
Even your biggest fans are going to be annoyed if all they see from you is the same ad over and over again.
When we talk about this issue though, we’re talking about just seeing one ad too many times. If your mind is on frequency right now, well, we’re glad!
But this point applies more generally to your ad formats and messaging as a whole.
It’s easy to find an ad format that works, and just template it and pump out the ad content.
We’ll admit that as a newbie, we did that too. And while that might be great for productivity or efficiency, it’s a bad marketing tactic.
If you watch big brand campaigns, you’ll notice that no one keeps the same format, style, or messaging every single time.
Sure, things like logos, taglines, and spokesgeckos stay the same over time, since we need that continuity to build a relationship with your audience.
But, they take chances with other aspects of advertising. And that includes changing:
- how you communicate with the audience,
- what your message to them is,
- what your images or videos look like, and
- what products you show.
You have to keep even your biggest fans interested, and you won’t do that by showing the same thing over and over again.
You’ll want to strategically test new formats and tones, especially if they’re a big departure from your normal thing, but you should prioritize it.
Create a document that you can use to track what you test and how the ads perform.
Keep doing the things that work, and put more money behind those campaigns to eventually lower your Facebook ad costs.
We suggest running A/B tests to test and track these ads.
Depending on your campaign objective (clicks, video views, likes), your ads can show on:
- In-Stream Video
Desktop placements typically get more clicks, but mobile placements will get more app downloads (that’s an obvious example, but still).
If your goal is to get more clicks, you should show your ads where clicks are more likely to happen, which is on desktop.
If you’re going for app downloads, mobile placements make more sense. This is where you’ll need to use Manual Placements.
How to set up Manual Placements in Ads Manager:
- Go to Ads Manager.
- Choose your objective and click Continue. Not all objectives support all placements though.
- Go to the Placements section. Automatic Placements (Recommended) is pre-selected.
- (Optional) Choose Manual Placements to exclude certain placements instead. Uncheck the box next to each placement to remove it.
If you don’t see a box, your ad type or objective doesn’t support the placement.
- You can also choose to turn off Placements by deselecting the boxes by Facebook, Instagram, Messenger, or Audience Network.
Again, if this is something you want to see, check out the walkthrough guide at the top of this post.
If you’ve been advertising on Facebook for a while, you know this topic by its old name: Ad Relevance Score.
This has been replaced with Ad Relevance Diagnostics, which includes 3 measurements:
- Quality Ranking
- Engagement Rate Ranking
- Conversion Rate Ranking
Facebook is measuring whether you have good quality creative that’s showing to the right audience.
Facebook recommends trying to find the ideal creative/targeting combination, not just focusing on ideal creative or ideal targeting alone.
What does each of those things mean?
Here is their definition directly from Facebook.
- Quality Ranking is your ad’s perceived quality compared to ads competing for the same audience.
- Engagement Rate Ranking is your ad’s expected engagement rate compared to ads competing for the same audience.
- Conversion Rate Ranking is your ad’s expected conversion rate compared to ads with the same optimization goal competing for the same audience.
What is a good score?
You want each of the three metrics to be at average or above average, ideally.
If your Relevance Diagnostics are below average, your ads are going to cost you a pretty penny (and aren’t going to do much by way of converting).
You will see significant ad performance and cost improvements if you raise your metrics from below average to average.
Or also by raising it above average (by changing your creative or your targeting – or both).
You will see small improvements if you raise your average score to above average, so we wouldn’t stress out about those much.
Focus on raising your below-average scores if you have them.
Where can I find Ad Relevance Diagnostics in my account?
- In your ad account, navigate to your Ads tab (Ad Relevance only applies to Ads, not Ad Sets or Campaigns).
- After that, Quality Ranking, Engagement Rate Ranking, and Conversion Rate Ranking should be visible to you.
- If you don’t see those columns, reset your column view to “Performance (Default)” or click the blue plus sign to add the columns.
- You’ll then find the Ad Relevance Score.
What do these diagnostics mean?
Now, none of that information is helpful if you don’t know what to do with the information you’re presented with, right? Right.
So, let’s take a look at some possible outcomes and what that might mean for you.
Note that we can’t go over every scenario in this post, for the sake of time.
Now, if you have everything at average or above-average…
…you’re doing great and probably don’t need to worry too much about making adjustments to the ads that are running.
If that campaign is over, it’s one that we would consider running again (or running a similar campaign) to a similar audience.
But let’s say you have below average conversions rates, but your engagement and quality scores are above average.
That means you’re possibly:
- targeting a lower-intent audience than you think,
- you don’t have an engaging CTA, or
- you’re losing people post-click (either from the website or checkout experience).
We would make the easier fixes first. Here’s what you can do:
- target a higher-intent audience, or
- write a better CTA.
But if the ads still aren’t improving, we’d look at the post-click experience and change it.
Now, sometimes we don’t worry about a below average Conversion Rate Ranking.
We know, it seems wild. But sometimes, our client already has lower conversion rates (because they sell high-ticket items for example).
If the conversion rate meets your expectations, don’t worry about it.
Let’s say your Facebook quality ranking score is below average, but your engagement and conversion rates are above average.
Most people would say, “I need to design better ads”… and that might be true.
Or, it could be that you’re just not showing the ads to the right people.
It means they’re low quality to that audience, though it wouldn’t be considered low quality to another audience.
It’s important to look at each metric in combination with the other two and make adjustments accordingly.
Also, keep in mind that you’ll need to make adjustments continuously and you’ll just need to test things as you go.
A/B testing, again, can be super helpful here.
When you’re running ads, you want to show your ad to the best audience at the best price.
Even though Facebook is the most affordable small business advertising platform (for now)…
…you can start to spend more money than you want to if you’re not optimizing your ads properly.
Ads will naturally go up in cost over time. No campaign can last forever.
But, now you know what to do to lower your Facebook ad costs.
And if you want to partner up with a reputable company to take your Facebook ads to the next level without draining your budget, LYFE is here to help.
Get in touch with our Facebook advertising agency today!