That is probably one of the most common questions I hear when discussing ad campaigns with a prospective or new client. It’s also probably one of the most commonly asked questions about Facebook ads in general.
Unfortunately, for most who ask, the answer is: It Depends.
It depends on how much your product or service sells for. It depends on how established you are as a business. It depends on how big of a campaign you have in mind. And it depends on how much you can afford to lose.
Facebook really is one of the most effective channels for advertising ever invented, and hiring a professional to run them for you will increase your odds of success. But at the end of the day it is Facebook that is going to decide how generous it is going to be with your campaign.
Perhaps the most relevant question is actually: How much can you afford to lose?
If you think of Facebook in those terms then you can start to get a picture for what your budget should be starting out on your own. Think of that initial budget like a school tuition or a bet in a casino. You may or may not ever see that money again, but hopefully by the time it’s gone you’ve learned something about your business or marketing.
One of the best things that I can encourage new Facebook ad operators to do is to simply play. Try things out. Create and test hypotheses. Approaching it as an experiment will mean that no matter the success of the campaign, you will have something valuable to take away. Maybe it’s that a certain demographic is or is not good for your brand. Maybe it’s that a certain kind of content will get more clickthroughs. Whatever it is, make sure that you keep track of that. Because if you spend $50 this month and learn that the best audience was over 45. And then next month you spend another $40 and learn that they also like long form articles and are more likely to engage with you from that format. Then on month three you can design a specific piece of content for that audience and put a little money behind it, and most likely you’ll get a great result!
So, perhaps the better question here is: If I were just starting out with Facebook ads and had no idea what I was doing, What would be the best use of my money to start using Facebook ads?
Well #1 is the same step that I still do for each and every client the first time that we work together if they have not done this exercise themselves. It’s a very simple test that will save you thousands down the line with your campaigns. I would run a demographics test.
I would take what you think you know about your audience and throw it out the window and approach this with new eyes. We’re going to set up a very simple ad that has some kind of catchy image and a call to action that has something to do with your business. And then we are going to run this to a wide open audience. Just set the location, language, and then set up a number of different audiences at different age ranges and sexes. IE:
Men 20-30, Women 20-30, Men 31-40, Women 31-40, etc.
Then just let the ads run and watch what happens. See who actually interacts with your ads. Collect this data and then review it after just a few days and see what interesting traits rise to the surface. You may discover that a particular age range interacts more than others. You may discover that yet another age range doesn’t interact that much, but is significantly more likely to become a paying customer. Maybe they are all from particular regions. Maybe they have particular interests that you didn’t know about. Who knows. The point here is to experiment and see what interesting data rises up. How much would I spend on this? Well if you are really just getting started and have time but not money, I would suggest letting it run at around $1.50 per day for two-three weeks. Why? It should collect a meaningful amount of data while still keeping the budget something that even someone just starting out can afford.
The following month I would run a similar test, but this time with different types of content. Try creating ads that are expressly designed to offer value to your audience. Try running ads that are promoting a how to guide, a long form article, a video, images, infographics. Whatever you can create, give it a try. Then run all of these simultaneously to your best audience segment that you discovered from before and see which ones work best. Again, start watching for patterns that arise and collect that data. Once again, we can run this with a very small amount of Facebook ad budget and still get a good amount of data. By the end of this test you should now have a picture of who your best audience is, and what kind of content they like best.
The last piece is to put this information together to create a basic campaign that actually converts that traffic into paying customers. We are going to do this with the one-two punch strategy. Create a killer piece of content based on what you now know from the last test. And when I say killer, I mean it! Put some time into this bad boy. Next up, we are going to create a compelling offer that is irresistible for this target audience. We are going to create an ad for each of these items and then show them one after another to warm up the audience, and then tell them what we have to offer and close the sale.
So the first thing to do this is going to be making sure your Pixel is installed to you can track the traffic. A quick google search will yield some good instructions for how to do this for your particular site. Next you will want to set up a Custom Audience that is comprised of people who have visited your website based on the data that the Pixel will be tracking. Again, a quick google search will give you instructions on this. Next, we set up the ads.
Target the first ad with your piece of really cool content at anyone in your target audience from the first step. Let it run with about 75% of the total budget that you have for this month. Next set up a second ad with your really cool offer and target this one ONLY to people who have previously visited your website. Use the remaining 25% of your budget on this. This strategy will ensure that these ads are only seen by people who are already familiar with your brand and what you have to offer and are more likely to actually complete a purchase.
And that’s it! That is the strategy that I would recommend to anyone just starting off with Facebook ads and wondering how much to spend on Facebook ads. Just keep watching the data from this campaign as well as any google analytics data that you may have to see how people move through your site, where they are coming from, and which groups of people are making buying decisions. Constantly watching this data and making adjustments will ensure that you are able to make the most out of any size budget that you have, no matter how large or small.