Should you budget $5,000 or $50,000 for your next Facebook ad campaign?
Tough question, right? If you budget too small, your campaign is dead in the water before you get results. If the budget is too big, you may risk tapping out your audience too quickly and spending too much to get qualified leads. And because Facebook has so much potential marketing muscle, you want to use it to the best advantage—driving traffic, earning clicks, and boosting conversions. But advertising takes money, and creative genius often has to be curbed by the dollars you have available. The key is knowing where and how to invest those dollars to get the best possible return.
4 Questions You Should Ask About Facebook Ad Budgeting
So how much money will you need to run a decent Facebook advertising campaign?
The answer is: it depends. Your budget needs will hinge on your campaign goals. Let’s look at four questions you should ask to determine how much you should plan to invest:
How aggressive is your goal?
Every marketing campaign should start with identifying your goals. You can’t possibly know whether your campaign has been a success unless you know what success looks like. Start by asking yourself:
- What do you want to achieve?
- What specific metrics will indicate success (10,000 fans? More website traffic? Higher quality leads? More conversions?)
- What do those metrics look like now? What are your current benchmarks?
You also have to consider where you’re starting. It takes a bigger advertising budget (and more time) to grow from 100 fans to 10,000 than it does to grow from 8,000 to 10,000. If your goals are aggressive, plan to spend accordingly.
Do you have an engaged audience already?
If you already have a fully engaged audience of warm prospects, you won’t have to spend as much to reach your goal as you would with mostly cold, disengaged prospects. This is especially true when you’re trying to drive more sales or conversions. The more engaged your audience is, the easier it will be to reach and convert them. By contrast, a cold audience that consists of people who don’t know you or your brand and haven’t expressed interest in your offers will require more money and time initially.
How large is your potential audience?
Your goals and niche also determine how large your potential audience will be. For example, if your goal is raising brand awareness among a broad audience, you have the potential to reach a large number of people. However, if you are targeting specific buyer segments hoping to drive conversions, your potential audience will be smaller.
Your market niche plays a role here as well. If you’re selling Caribbean vacations, for example, choose your audience segments carefully based on the income ranges, interests, and demographics of your ideal customer. Those kinds of differences will affect how likely someone will be to click on your offer. Not sure who your ideal customer is? Maybe it’s time to work on identifying your Buyer Personas!
How much time do you have?
Are you trying to boost traffic and clicks quickly? Is your director breathing down your neck with a specific goal for the end of the month/quarter/year? If so, you may need to plan for a larger budget. As the old adage goes: you can have it done Fast, Good or Cheap - now pick two. If you want it done Fast and Good, it will cost more.
In addition, the time you need to implement your strategy will also depend on how difficult your niche is, how aggressive your goals are, and whether you already have an established Facebook presence.
But How Much Money Will It Take?
The bottom line is that your budget will depend on what you want to do. However, we can give you some rough estimates for what to expect in terms of actual cost based off our extensive Facebook Advertising experience over the years. We typically recommend that you plan to spend at least the following*:
- $1 per new like—That means if you want to add one thousand fans, you should plan to spend about $1,000.
- $1 - $2 per landing page offer click—You should plan to spend a little more to drive traffic to a landing page promoting a specific offer. Remember, however, that a landing page click doesn’t necessarily equal a conversion. Your conversion rate corresponds with how well you have designed the landing page and offer.
- $.50 - $.75 per blog post click—Blog posts don’t require as much commitment on the part of the visitor, so you typically don’t have to spend as much to earn those clicks.
*Can vary depending on the variables mentioned above, and your specific industry and business.
As you set your budget, take a look at each of your goals and your estimated cost to reach that goal. Add up the total and break it down into a monthly budget based on your timeframe. It’s always a good idea to budget conservatively so that you don’t run out of money before you have reached your goals.
And now how about you? How have you budgeted for Facebook ad spend in the past? What changes or recommendations would you make for future campaigns? Let us know in the comments!