This is one of the questions our clients ask us most: how much do we need to spend on Facebook ads to get tangible results?
The answer isn’t simple. Some agencies will tell you that you need to spend tens of thousands to get maximum reach, without any thought for what your business is actually trying to achieve.
How Big is Your Audience?
Unfortunately, there are no hard and fast rules on what you should and shouldn’t spend on Facebook for advertising. How much you can (and should) spend depends on the type of business you run, the locations you’re advertising in, and your objective.
For example, a large online fashion brand with national or even global coverage will naturally need a bigger social advertising budget, which could easily run into tens of thousands of dollars per month.
At the other end of the spectrum, you might run a boutique fitness studio with a very local market, where you only want to reach people within 3-4 kilometres of the studio. Your potential audience is far smaller than a global company’s, so your budget can be a lot smaller too.
Audience size isn’t the only factor. Your mix of objectives also has a big impact on how much you should put into your campaigns. Brand awareness and exposure, consideration, conversions and retargeting all call for different approaches.
Deciding on Budgets
Many budget decisions come down to a testing phase at the start of your campaigns, or to what previous campaign data tells you. As a data-driven digital agency, we use these tests and reviews to work out your base cost per acquisition. From there, we can set firmer budgets based on what we find.
Keep in mind that if you’re getting a positive ROI on a smaller budget, simply increasing it 2x, 3x or 5x is not an effective way to scale your ads. More often than not, it hurts performance and pushes up your overall cost per acquisition. We manage this with clients on an ongoing basis. When things are going well, it’s tempting to throw more money at it in the same way, but that doesn’t always get you the result you want.
That’s why we prefer a more strategic approach to campaigns, especially when scaling. Whichever agency you work with should be able to look at your historical paid Facebook campaign data and recommend budgets based on it.
If you have no history, or haven’t run campaigns before, a small testing budget is an easy way to get useful insights from Facebook in the early days.
The most important thing is that your agency can find the sweet spot where you get the reach and exposure you want with a favourable ROI!
Talk to OMDIGI About Social!
Want to know more about our paid and organic social services, or talk through an upcoming campaign and how OMDIGI Group can help? Contact us today!
