How much should I spend on Facebook ads?
Interestingly, almost everyone that comes to us for Facebook advertising support has run some sort of campaign themselves in the past. They tend to have thrown a few hundred pounds towards ads but haven’t seen results they’d hoped for. The majority of businesses just don’t have the time or expertise to get real results and so they come to us. One of the questions they always ask me before we start working together is: how much should I spend on Facebook ads?
This is a great question. With Facebook, you can spend as little as £1 per day (with no maximum spend). This can be quite daunting for someone who doesn’t have experience or knowledge in the area because they just don’t know how much they should spend. In this article I’ll explain how much you should spend on Facebook advertising.
According to Moz, by spending just £1 per day on Facebook ads, you can reach around 4,000 people that wouldn’t have otherwise seen your brand. Combine that with the fact your competitors probably aren’t doing that and you can already see why that may work.
Most businesses can afford to spend £30 per month on ads. Most businesses will generate more than that from one conversion.
But every business is different so here’s a process you can go through. The first thing you want to do is…
Look at your budget
Do you have a budget for advertising? Is there a maximum you can spend? Perhaps you work for a company and have a limit on the amount you can spend. I advise not to have a budget where possible. If done correctly, you should start to see conversions and a ROI on Facebook within a few weeks. You won’t need a budget because you’ll be making money on the ads. However, I do understand that some companies will have a set budget. If that’s you, determining your budget is the first thing you need to do.
The next thing to do is…
Take a look at previous conversions
As a marketer, you should have a rough idea on the number of leads/enquiries/website visits you need in order to convert someone. If you’ve run Facebook ads before, you’ll have an idea of how much you need to spend per conversion.
For example, if you know for every 100 people that sign up for your webinar you can convert 5, and that 5 customers bring in £500 revenue each, you know you need to that in order to run a profitable Facebook campaign, you need to spend less that £2500 to get 100 people to sign up to your webinar. (obviously this example doesn’t take into account time & other costing factors)
So if you have data like this to hand, you can easily take your goals and conversion rates and figure out how much you have to spend to make your ROI.
Despite all this, there’s one thing I recommend doing…
Start small before scaling
It’s important to start any Facebook advertising campaign with a small daily budget. I always recommend starting with something like £5-£20 per day. Every successful Facebook advertising campaign requires a lot of testing and optimisation before it really starts to work.
If you start a campaign off with too high a budget, Facebook will swell to that budget and you’ll end up paying more for your clicks and conversions.
Start with a small budget, test and adapt and when you reach a conversion cost that works for you, start scaling the spend up. By that point, it should effectively be like a tap. You can increase the spend when you want more leads and you can reduce it when you can’t take anyone else on.
If you work through those three steps, you should come out with a good understanding on how much you should spend on your Facebook advertising. This is the process I work through whenever I work with a new client to find out how much we should be spending.